A key performance metric used in healthcare organizations, clinics, and medical practices to measure the average cost of acquiring a new patient. Similar in concept to Customer Acquisition Cost (CAC) in business settings, PAC provides insight into how much money is being spent on marketing, advertising, outreach, and sales efforts relative to the number of new patients acquired.
By understanding PAC, healthcare providers can evaluate the efficiency of their marketing investments, optimize campaigns, and benchmark growth strategies. A high PAC may indicate overspending or inefficient targeting, while a low PAC suggests effective marketing and referral systems.
PAC is especially critical in industries such as dentistry, elective surgery, and private medical practices, where direct-to-consumer marketing is a significant driver of new patient flow. It can also inform pricing strategies, return on investment (ROI) calculations, and long-term financial planning for sustainable patient growth.
Formula for PAC
The formula is straightforward and mirrors similar acquisition cost metrics:
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- Total Marketing and Sales Costs include advertising spend, staff salaries, agency fees, software costs, and promotional activities directly tied to patient acquisition.
- Number of New Patients Acquired is the count of unique first-time patients over the same period.
Why PAC Matters
Measuring PAC allows healthcare organizations to make data-driven decisions about growth. When combined with metrics such as Patient Lifetime Value (PLV), PAC helps determine whether acquisition strategies are sustainable and effective. For example, if the PAC exceeds the expected lifetime revenue from a patient, the practice risks running at a loss despite strong acquisition numbers.
In modern healthcare marketing, PAC is also used to evaluate channel effectiveness (e.g., paid search, social media, and referrals) and can inform resource allocation. By continuously monitoring this metric, providers can reduce costs while maintaining or increasing patient volume.
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