Therapy Practices: What’s Your Average Sesson Fee (ASF)?

Therapy Practices Average Session Fee

What is your Average Session Fee?

    We respect your privacy. Unsubscribe at anytime.

    Powered By ConvertKit


    As a therapy practice, know that your clients are anything but average. They all have their own feelings, personality traits, needs, and dreams. These are the people you heal, each with their own unique story.While your clients and sessions are anything but average, there are some quantitative metrics that you can (and should!) average. The #1 statistic that you should track is Average Session Fee, or ASF — the average amount of money that you are paid per session.


    Watch Toni explain Average Session Fees in detail over on our YouTube channel.  


    Why Is It Important to Track Your Average Session Fee?

    Before we get into the mechanics, let’s discuss why ASF is an important metric to track.

    Do you ever feel anxious wondering how much money you will make in the coming year? This is important to know, because you have plans and dreams. Maybe your dream is to buy a house, have a child, put the children you already have into college, save for retirement, or even go on a vacation at some point. After all, everyone deserves a vacation sometimes.

    Going after dreams like these is part of what makes life wonderful. But if you don’t know what to expect income-wise over the next year, you risk financially over-committing to a dream and not leaving enough money for rent or mortgage. Alternately, you might be too cautious and under-commit to your dream, stretching the amount of time before you make it a reality.


    How Do You Calculate Your Average Session Fee?

    Here at TL;DR Accounting, we love the nuts and bolts of Excel formulas and calculations. Whether or not you love these nuts and bolts as much as we do, they are important. Let’s get into how to calculate your Average Session Fee:

    1. Calculate your average number of clients per week.
      1. Ideally, count your clients over the past six weeks then divide by six.
      2. Alternately, if you have a clear understanding of how many clients come to you for help every week, you can go with that number.
      3. We recommend that you use hard data whenever possible.
    2. Determine what types of clients these are.
      1. How many clients do you get per week who pay without insurance?
      2. How many pay on a sliding scale (if you offer one)?
      3. How many pay on each different insurance plan?
      4. Multiply the number of clients times the money you get per client in a week, for each type of client.
    3. Tally up session fees for a week.
    4. Divide your average weekly income by your average number of clients per week. You’re done!

    Let’s go through an example in case that will help:

    Julie always wanted to go on a trip to Japan, but she’s unsure if she’ll be able to afford it. 

    1. She doesn’t know how many clients she gets in a week off the top of her head, so she checks her calendar.
      1. Over the past six weeks, she has had 138 sessions. Divided by six, that comes out to 23 sessions per week.
    2. To determine the breakdown of client types, Julie can either estimate or check her records to make an educated guess on the average client breakdown by type:
      1. 5 clients pay without insurance at $140 per session, totaling $700.
      2. Julie reserves 1 session per week on a sliding scale for her clients without means. The sliding scale price this week was $75.
      3. She accepted four different kinds of insurance:
        1. Plan A had 6 clients at $85 totaling $510.
        2. Plan B had 7 clients at $120 totaling $840.
        3. Plan C had 2 clients at $100 totaling $200.
        4. Plan D had 2 clients at $75 totaling $150.
    3. Tallying up all the totals makes $2,475.
    4. $2475 divided by 23 equals $107.61, Julie’s Average Session Fee.


    Download your Average Session Fee Spreadsheet:

       Ok, I’ve Calculated My ASF. What Do I Do Now?

      Congratulations, you’ve figured out your ASF! Now let’s use this to estimate your income.

      (If you’re having trouble calculating your ASF, contact us and we can help you get to that magic number.)

      So, what’s next? Next is to figure your annual income, and then determine whether you need to make any changes. Here are the steps:

      1. Determine how many weeks you work in a year.
        1. We understand that burnout helps nobody. Don’t burn yourself out working 52 weeks a year. Everyone needs time to decompress, and also leave some room for time off during the holiday season.
      2. Multiply your number of working weeks, by your average number of clients per week, by your Average Session Fee.
      3. Determine whether you need to take action to raise your ASF. If you need to raise it, here are two ways to do so:
        1. Raise your fees with new clients only. Over time as you gain more new clients, this will increase your Average Session Fee.
        2. If you take insurance, slowly drop panels that offer low reimbursement rates
        3. Raise client rates each year for current clients by a small percentage until they are at your current rate

      Let’s look back to our example, Julie the therapist who dreams of visiting Japan:

      1. Julie has determined that she wants to work 48 weeks per year, leaving 2 weeks for a vacation (like her vacation to Japan!) and 2 weeks off for the holiday season.
      2. She multiplies 48 * 23 * 107.61, getting $118,800.
      3. Julie is satisfied with her income, but she realizes that she has options to increase it by raising fees. Also, she’s at the point where it may be beneficial to become an S-Corporation.


      TL;DR: Knowing your Average Session Fee (ASF) can give you a lot of power to make educated decisions about your financial future. Perhaps more importantly, it can lead you to make timely decisions about when to raise your rates or drop insurance plans that offer low reimbursement rates. The ASF calculation can be a bit tricky, but we can help you with that! 


      Get in touch to schedule your first appointment here. We’re happy to help!

      Khaled - TLDR

      Khaled Albadawi, CPA

      Principal & CEO

      Khaled joined TL;DR as Principal in December of 2022, and has quickly hit the ground running offering a fresh new perspective for the TL;DR team and clients. He’s a natural entrepreneur & leader, starting his days at 4 AM with a nice cup of coffee to get a jumpstart on projects before the business world wakes up. His one piece of advice to business owners? Ask yourself if you are creating just another job or a business. Ideally, you should be building something that doesn’t require you to be there 40 hours a week!

      you may also like:

      Vector 3 (2) (1)

      ready to work with us?

      You can schedule your introductory chat: 

      © Copyright TL;DR: Accounting 2022