Is it better to constantly acquire new patients or focus on retaining your practice’s existing patients? While new patients are always welcome, returning patients are also valuable and may have a greater impact on your practice’s revenue. Focusing on your patient lifetime value, rather than the value of a single visit, is one way to keep your organization profitable.
Patient lifetime value (LTV) is a formula your practice can use to determine the revenue a patient brings in over the course of their relationship with your business. There are two ways to calculate patient LTV.
The first method uses the same revenue amount over the course of the patient’s lifetime. The second method uses different revenue amounts over this lifetime.
To calculate patient LTV, multiply the expected revenue generated per appointment by the expected number of annual appointments by the number of years a typical patient remains at your practice.
The longer a patient remains with your practice, the more appointments they book — and the more revenue brought in per appointment, the higher their LTV. When a patient’s LTV is high, your organization brings in more revenue.
When you know your patient LTV and work to increase it, you also improve patient experience and the quality of care people receive. The result is a win-win situation for your practice and patients.
There are several ways to increase the number of visits patients make to your practice or lengthen the term of their relationship with you, which subsequently boosts their LTV. Consider these tips: