A practice can subscribe to several individually useful services and still struggle to explain how much those services cost together. A directory fee appears in one account, payment processing is deducted before settlement and staff spend time reconciling another system. None of those amounts looks decisive on its own, but the combined effect can materially change the economics of care.
The phrase "platform tax" in this article is a metaphor, not a government tax or a legal category. It describes the accumulated commercial and administrative cost of using digital services. The model below is fictional, intended to help a clinician examine actual contracts and accounts rather than estimate any named platform's charges.
Map the charges to the work they support
Start with patient discovery, booking, clinical records, communication, payments and billing administration. Identify the supplier involved at each stage and the event that creates a charge. It might be a monthly subscription, an additional user, a booking, a transaction or a volume threshold.
Different models are visible in current products. Cliniko publishes subscription pricing, while Zocdoc describes discovery-related booking charges. Those examples illustrate why one universal cost-per-patient assumption is inadequate; they are not being compared as equivalent products.
Include work performed by the practice itself. Time spent correcting data, checking charges or reconciling payments may be a real incremental cost even though no technology company invoices for it.
Begin with collected revenue
Use money actually collected for the relevant period or a clearly defined expected-collection model. Do not mix list prices, invoices raised and bank receipts without explaining the difference. A high nominal fee does not help the calculation when part of it is discounted, unpaid or refunded.
For the fictional example, a clinic completes 120 consultations in a month and collects GBP180 for each. Collected consultation revenue is therefore GBP21,600. The example assumes these amounts are settled and does not include outstanding invoices from other periods.
This is a simplified operating model, not a set of accounts. A real practice should reconcile its chosen measures with its accountant and apply the relevant treatment of taxes, timing and other financial obligations.
Deduct clinical delivery costs first
Assume the clinic pays GBP90 per completed consultation for clinical delivery, giving GBP10,800. This example treats that as an actual cost, not as free labour by the owner. A further GBP15 per completed consultation for room use and consumables adds GBP1,800.
After those two categories, GBP9,000 remains from the GBP21,600 collected. This is before the platform-associated costs and the other overheads not included in the illustration.
The distinction matters because marketing returns are sometimes calculated against the full consultation fee. A platform that generates GBP180 of revenue has not generated GBP180 of contribution when delivering the consultation already costs GBP105 in this example.
Add the visible and less-visible platform costs
Assume payment processing costs 2% of collected revenue, or GBP432. Thirty chargeable discovery bookings at GBP25 each add GBP750. Of those 30 bookings, 24 lead to completed consultations within the month's total of 120; the model does not count the other six as revenue-generating visits.
Monthly practice software costs GBP240, a reputation service GBP120, an AI reception component GBP200 and a billing administration service GBP150. Together, these subscriptions and services cost GBP710. A further 12 hours of genuinely additional administrative work at GBP25 per hour costs GBP300.
The platform-associated total is GBP2,192: GBP432 plus GBP750 plus GBP710 plus GBP300. All prices are invented. They are not quotations from the companies discussed elsewhere in this series.
What remains in the example?
Subtracting GBP2,192 from the GBP9,000 remaining after clinical delivery leaves GBP6,808. That amount is before insurance, accountancy, other unlisted overheads, owner management time and tax. It should not be described as the owner's take-home pay.
The platform-associated costs equal approximately 10.15% of the month's collected revenue. Not all of that amount is supplier income, because the calculation deliberately includes the clinic's additional administration. The percentage is useful as a management measure only when its definition remains consistent.
The purpose is not to argue that 10.15% is inherently excessive. The services may generate appropriate activity, reduce other costs or improve reliability. The question is whether their combined value justifies the expenditure compared with a realistic alternative.
Examine each fee trigger
The fictional discovery charge is GBP25 per booking, but GBP750 divided by 24 completed consultations is GBP31.25 per completed consultation. The difference arises from the six bookings that do not produce completed care in the period.
Likewise, a payment percentage should be applied to the relevant transaction base, not automatically to every figure labelled revenue. Read the contract for refunds, failed transactions, additional services and other exceptions. A headline rate may not describe the complete cost.
Subscriptions require similar care. Establish whether the fee is per clinician, location or organisation, and whether a threshold changes the price. The financial effect of adding a clinician can differ from simply adding another appointment slot.
Look for duplication before cutting useful functions
Two systems may both send reminders, hold demographic information or provide payment links. Duplication can create cost and confusion, but removing a product without understanding the workflow can create more work than it saves.
Map which system is authoritative for each task. Ask whether an overlapping function can be disabled or replaced safely, and what migration or training is required. A lower subscription bill is not an improvement if staff now spend more time correcting errors.
The iatroX guide to choosing practice software provides a framework for deciding what the practice actually needs. Consolidation should follow that assessment, not precede it.
Test small changes in the model
In the fictional example, reducing the processing rate from 2% to 1.5% would reduce that cost by GBP108 for the month. This is a sensitivity calculation, not a claim that such a rate is available to the practice.
Removing an unused GBP120 subscription would save GBP120 only if no replacement cost or contractual charge arises. Reducing genuinely additional administrative work by four hours at GBP25 would save GBP100. These are modest, concrete changes that can be compared without relying on speculative growth.
By contrast, filling more appointments is not automatically the best response. Additional care must be appropriate, and its contribution must account for delivery costs, capacity and follow-up. Increasing volume to compensate for a poor cost structure can make the practice busier without making it more sustainable.
Separate fixed, variable and transition costs
Fixed subscriptions behave differently from per-booking charges. A subscription spread across more appropriate activity may become cheaper per episode, while a transaction fee continues to rise with use. Some contracts combine both.
Transition costs belong in a separate line. Migration, training, overlapping subscriptions and temporary productivity loss can make the first year more expensive than later years. Do not hide them, but do not assume they recur indefinitely either.
The same distinction applies to released staff time. If the practice's cash expenditure does not change, report an operational benefit rather than a cash saving. This keeps the business case credible and avoids double-counting the same improvement.
Use a recurring review rather than a one-off purge
Review the stack when contracts renew, clinicians join or a major workflow changes. Keep the actual invoices, fee schedules and a simple account of the work each service performs. Investigate changes in effective cost per appropriate completed episode.
A useful platform can be worth paying for, and a cheap platform can still be poor value. The objective is not the smallest possible software budget. It is a clear relationship between expenditure, appropriate care, reliable administration and sustainable professional income.
The platform tax becomes manageable when it stops being invisible. Once the practice can see the full chain from collected revenue to the amount remaining, it can make better choices about subscriptions, workflows and growth without confusing activity with profit.
FAQs
Is the platform tax a formal tax on doctors?
No. It is a metaphor for the combined cost of digital services and associated administration. Actual tax obligations are separate and depend on the practice's circumstances.
Should marketing return be calculated from the full consultation fee?
Not when assessing profitability. Deduct the direct cost of delivering appropriate care and include acquisition and administrative costs. Revenue multiples alone can exaggerate economic value.
Is the cheapest software combination necessarily the best?
No. A low subscription cost can be offset by manual work, errors or poor integration. Compare the full operating cost and the value of the workflow rather than subscriptions alone.