Charge Per Visit, Payer Mix, and EBITDA: What Metrics Actually Matter?
If you own a private healthcare practice, you’ve probably heard terms like charge per visit, payer mix, and EBITDA tossed around by accountants, bankers, or consultants. And if you’re honest, maybe your eyes glazed over.
You didn’t get into healthcare to become a finance expert. You became a clinician because you wanted to help people heal. But here’s the reality: if you don’t understand the handful of financial metrics that really drive your practice, you’ll forever feel like you’re guessing when it comes to growth, profitability, or even retirement.
Let’s break these down in plain English — no CPA required.
1. Charge Per Visit: The Starting Point of Revenue
At its core, every practice is built on visits. A patient walks in, receives treatment, and you send a bill. That’s a “charge.”
Charge per visit (CPV) is the average amount your practice bills each time a patient comes in. For example:
If you bill $150 for an eval and $120 for a follow-up, your average might land around $130.
Multiply that by the number of weekly visits (say 200 visits), and suddenly you see that small changes add up fast.
Why it matters:
If your charge per visit is too low compared to national best-in-class benchmarks, you’re leaving money on the table.
If one therapist starts undercharging due to patient complaints, it drags down the entire practice’s revenue.
But here’s the catch: charges don’t equal collections. Insurance companies don’t care what you bill; they care about the contracted rate. That brings us to the next metric.
2. Payer Mix: Who’s Actually Paying You
Imagine two clinics.
Clinic A: 70% Medicare, 30% commercial insurance.
Clinic B: 70% commercial insurance, 30% Medicare.
Both might have the same charge per visit, but Clinic B will collect significantly more per visit because commercial contracts often reimburse higher than Medicare.
This balance between payers is your payer mix — and it’s one of the most overlooked levers in practice profitability.
Why it matters:
If more than 25% of your revenue comes from one payer or referral source, you’re at risk. If that contract gets cut, your practice could take a nosedive.
A smart payer mix blends contracts to protect your margins while spreading risk.
Negotiating payer rates is possible. I’ve personally negotiated increases up to 57%. But it only works when you have data and leverage — strong visit volume, great outcomes, and a loyal referral base.
So while you can’t control what Medicare pays, you can control your balance of payers and how you position your practice to commercial insurers.
3. EBITDA: The Language of Value
Now we get to the term that trips up most practice owners: EBITDA — Earnings Before Interest, Taxes, Depreciation, and Amortization.
Sounds like accountant mumbo-jumbo, but here’s the bottom line: EBITDA is the number investors, buyers, and banks care about.
It strips away things that are unique to you — like your personal salary, discretionary expenses, or how you financed your building.
It shows the true, repeatable profit of your business.
Think of EBITDA as the scoreboard that tells you how valuable your practice really is.
Why it matters:
Private equity, hospital systems, or strategic buyers use EBITDA multiples to value practices. A $500K EBITDA practice could sell for 5x–8x that number, depending on size and stability.
Even if you never plan to sell, running your practice with EBITDA in mind forces discipline. It ensures you’re not just working hard but building an asset that works for you.
4. How These Metrics Work Together
Here’s where practice owners get confused: they look at these metrics in isolation. But the magic is in how they connect.
Charge per visit × Payer mix = Collections per visit.
Collections per visit × Visits per week = Top-line revenue.
Revenue – Expenses = EBITDA.
If you only focus on “more new patients” (the default mindset of most owners), you might actually grow broke — higher volume with the wrong payer mix just accelerates losses.
Instead, focus on efficiency:
Raise your average charge per visit to national standards.
Optimize your payer mix to protect margins.
Track your collections and expenses weekly to safeguard EBITDA.
This is why I teach owners to run their company by statistics, not feelings. When you have these numbers on a dashboard, you stop guessing and start leading.
5. Practical Ways to Improve Each Metric
Here are some field-tested strategies that move the needle:
Improving Charge Per Visit
Audit your coding patterns. Are you underbilling?
Educate clinicians on compliant but optimal use of codes.
Monitor if one PT is consistently charging less after pushback — this needs to be corrected fast.
Strengthening Payer Mix
Renegotiate commercial contracts every 2–3 years. Show them your outcomes, volume, and Google reviews (yes, it matters).
Cap your dependence: no payer should exceed 25% of total revenue.
Add cash-pay services where appropriate (e.g., wellness, performance programs).
Protecting and Growing EBITDA
Cut unproductive overhead: unused space, excess software, or discretionary perks that don’t generate revenue.
Track cancellations and implement scripts that save visits. Each kept visit drops straight to the bottom line.
Consolidate low-performing locations — sometimes less is more.
Use 5-day forecasts for visits and collections to stay ahead.
6. The Mindset Shift Owners Need
Most owners think: “If I just get more new patients, everything will be fine.” That’s like believing winning the lottery will fix your financial life. Without systems, it won’t.
Instead, adopt the mindset of a CEO:
Look at your practice as an investment vehicle.
Treat payer mix and EBITDA as levers you can pull.
Understand that volume without margin is just stress.
The practices that thrive aren’t the ones with the most patients — they’re the ones where the owner knows their numbers cold, makes data-driven decisions, and designs operations around profitability and patient outcomes.
Final Thought
You don’t need to be an accountant to master your practice finances. You just need to know which scoreboard matters.
Charge per visit tells you if you’re billing appropriately.
Payer mix tells you if you’re getting paid fairly.
EBITDA tells you if you’ve built a valuable, sustainable business.
Ignore these, and you’ll forever feel like you’re on a hamster wheel. Master them, and you’ll not only earn more today but also build the retirement and legacy you deserve.
The numbers aren’t there to confuse you. They’re there to give you control.
