Discounting methods and reporting options
There are multiple methods that can be used to provide ‘discounts’ to your clients. Each method has its own use considerations and specific reports to track activity and measure impact.
Before you start
- Understand the involved set up, staff use, client experience/perception, and your reporting needs to determine the best method(s) to use for discounting.
- Discounting methodology should be in a manner that is consistent, clear to your clients, and not create confusion.
- Discounting should be monitored for appropriate use with the reports outlined for the method employed.
- Logged in administrators can change prices regardless of the allow change setting on the invoice items.
There are six ways to set up discounts within Cornerstone:
- Preset / Transaction discounts: This is the recommended method. Discounts are automated when applied to both the invoice item and patient. Discounts are per line item.
- Manual Discounts: Discount applied to the entire invoice.
- Group code pricing: Price modification when using bundle/group services.
- Invoice items used as discounts: Coupons, rebates, vouchers.
- Invoice item price changes: Change the price manually on the patient visit list or invoice.
- Charging partial quantity or omitting provided services from the invoice: This method is not recommended.
Review the different types of discounts, setup and usage, to determine the best method(s) for your practice.
|Discount method||Setup needed||Use consideration||Client experience||Report impact|
Link to applicable items
Link to applicable clients
|Security settings can limit access.|
Can be added as needed, per billing item, if not linked to the item or client.
Can be applied to estimates, Patient Visit List(PVL), invoice, or documents.
|Discount description and total amount displays on invoice.|
Discount line detail is optional and based on invoice defaults.
Full price of the billed item(s) is clearly displayed.
|Maintains gross and net report values.|
End of period discount reports by discount or staff.
Discount totals found on End of period sales summary reports.
|Manual||None||Security settings can limit access.|
Only available on an invoice.
|Entered discount description and amount displays on invoice.|
Entered amount is calculated and deducted from each line for net revenue.
Full price of billed item(s) clearly displayed.
|Maintains gross and net report values. |
EOP Manual Discount reports by client or staff.
Discount totals found on EOP Sales Summary reports.
|Invoice item||Invoice item(s) |
Item classification: Recommended for easier tracking purposes.
|Unable to restrict use or amount.|
Items cannot be set up as a negative price and require manual input for each use.
Can be added to estimates, PVL, invoice, or documents.
|Full price of billed items clearly displayed.||No differentiation between net and gross sales amounts.|
Use Invoice Item Sales Information report or EOM Inventory or Serv. Sales reports by class.
|Group code pricing||Group invoice items with markdown pricing.||Applied automatically to estimate, Patient Visit list, invoice, or documents.||Potential confusion to what the actual pricing is, if the are items billed separately, readily explained if needed.||No differentiation between net and gross sales amounts.|
Use Standard Fee Exception report (with a reason of GID).
|Price change||Invoice items||Can restrict per item using the item’s Allow Change setting. |
Can also use minimum price to limit price change amount.
Logged in admin users can override prices at any time.
Can be performed on estimates, PVL, invoice or documents.
|Confusion as to what the actual pricing is.||No differentiation between net and gross sales amounts. |
Use Standard Fee Exception report.
|Partial quantity||Invoice item(s)||Can also use minimum price to limit quantity change amount. |
Can be performed on estimates, PVL, invoice, documents.
|Overuse can undermine the perceived value of related service.||Use Invoice Item Sales Information report or EOM Serv. Sales reports by Class.|
- Use of preset discounts, when completely set up, is best practice for the following reasons:
- Staff use
- Client perception of value
Note: Complete all setup steps for preset discounts to avoid missed discounts. Example: Veteran discount.
- Discount amounts can be tracked by discount and staff ID. Use a client report to display which clients have a linked discount.
- Discount totals display on end of period (EOP) sales summary reports. There are also dedicated end of period discount reports for tracking and measurement details.
- An Alert displays when applying discounts on the Invoice or Patient Visit list line item, if a discount is not linked to client.
- Manual discounts can be used per client invoice.
- While manual discount totals display on sales summary and end of period discount reports, tracking is not as detailed as preset discounts. For instance, you cannot track the amount per discount.
- Reporting is available by client or staff.
- Discount percentage/amount is calculated and deducted from each line item on the invoice.
- It can artificially reduce profitability on inventory items on Cost of Goods Sold (COGS).
- It is applied per line, in addition to any existing preset discounts, group pricing and other price changes.
Group code discounts
- Group pricing is available for items that can/should only be ‘discounted’ when they are part of a bundled service.
- Group discounting amounts are only tracked on the standard fee exception report (reason GID).
- Group pricing is treated as a ‘price change’ from a reporting perspective.
- Invoiced/reported amounts are the same for both gross and net and are indicated on the standard fee exception report with the reason ID of GID.
- With group pricing, price changes are not evident to the client on their invoice.
- The price differential can be viewed from the right click cost calculation window.
- Group pricing uses a different right click cost calc window.
- Adding a preset and/or manual discount to a group priced item will apply all discounts and price changes. Changes can be viewed in right click cost calculation window.
Setting up invoice items as a discount (coupon, rebate)
- Use of invoice items as a discounting method should be carefully considered.
- This is the easiest method to take advantage of, if it is not closely monitored.
- When used as a set amount discount, coupon, or rebate, set up in a manner that maximizes tracking capabilities and minimizes entry errors.
- Create an invoice item, per rebate needed for tracking purposes. Match the type to the associated billing item.
- Use the hospital description to define ‘price’ for the most accurate fee exception calculation.
- Use a client description for invoices and estimates.
- Set price as $0 and Allow change to Always or Require change.
Note: Setting a price and changing it to a negative at the time of use will double the calculated fee exception. Example: A rebate item is set to $15. It is invoiced at -$15. This will create $30 fee variance on the Standard Fee Exception report.
- Assign the rebate/coupon items to the same invoice item class to simplify reporting.
- Train staff to enter the price as a negative at the time of use, using the hospital description as the amount to use.
- Based on the doctors compensation method (gross or net), the staff ID used for line-item type ‘discounts’ should to one of the following:
- Calculating on net: Match the provider
- Calculating on gross: Use a specific non-doctor staff ID, such as hospital staff ID
Note: Each staff ID used on an invoice displays on the Statistics by Staff report.
Partial quantity invoice items
- Use case for minimum price/partial quantity invoice item discount: It can be used to counteract the giving of discounts by adjusting the quantity, when the item change allow setting and other discounting methods are locked down.
- Keep the following in mind when using partial quantity invoice items for discounting:
- Overuse can undermine the value of the related service. Example: 0.5 exams.
- Frequency of use should be monitored to determine if either of the following are needed:
- Additional team education on fee structure
- Review of service prices and levels
Staff production reporting
- Price changes are rolled up into the revenue reporting on these reports, that are used for tracking doctor production:
- Statistics by Staff
- Serv. And Inv. Sales by Staff ID
- Staff commission reports
- Staff commission reports offer both gross and net versions, based on use of preset and manual discounts.
- Line-item discounts (coupons, rebates) are subject to the default commission rate (acting as a deduction) unless exceptions for specific class/subclass or item(s) are set up, as part of the staff commission profile, or these lines items are billed to a non-doctor billing staff.
These Cornerstone reports provide information from the actions outlined in this article. Each report has its own security access under the Reports tab of the Security Setup window.
- Discount reports: Daily, monthly
- Manual Discount reports: Daily, monthly
- Serv. Sales reports: Monthly, yearly
- Inventory Sales reports: Monthly, yearly
- Standard Fee Exception report: Daily
- Invoice Item Sales information