Your Effective Hourly Rate Is $19

Your effective hourly rate is probably $19. Not your consult rate. Not the number on your fee schedule. The number you actually get paid for every hour you work, once you divide what the practice pays you by every hour you spend in the building.

I'm a software engineer by training. Twenty years writing code, the last four of which took an app from zero to $500 million. I've also been a functional medicine patient for fifteen years, watching from the chair as my own doctors ran practices the way I used to run bad software: everything routed through one person, no caching, no queue, every request handled synchronously by the most expensive processor in the building. That processor is you.

Here's the arbitrage nobody has priced out for you. You have a consult rate, the number you'd charge if every hour were spent doing the thing only you can do. Then you have a blended rate, the number you actually average once you count the hours spent on notes, admin, and marketing guesswork. The gap between those two numbers is money you're leaving on the table every single week, and it compounds because you're the one person in the building who can't be replaced by hiring the wrong role.

The Model, Not a Fact

Before the math: the $19 figure is not a measured statistic about functional medicine practices. It's the output of one illustrative model, built from assumptions I'm stating up front so you can swap in your own numbers and get your own answer. If your numbers differ, your rate will differ. Run it with reality, not with mine.

Assume the owner takes home $15,000 a month. Assume they work 50 hours a week, 48 weeks a year, which is 2,400 hours. That's $180,000 a year divided by 2,400 hours, which is $75 an hour blended, before we even segment anything.

Now segment the hours. Assume of those 50 weekly hours:

• 15 hours are consults, billed conceptually at $400/hour worth of clinical judgment
• 10 hours are note-writing and chart documentation
• 15 hours are admin: scheduling conflicts, vendor calls, staff questions, inbox
• 10 hours are marketing guesswork: writing the newsletter, tweaking the website, wondering what to post

Fifteen hours at $400 an hour is $6,000 of value created that week. The other 35 hours, notes plus admin plus marketing, produced the remaining $9,000 (roughly, once you back into the weekly take-home) spread across work that has nothing to do with why a patient chose this doctor over the group practice down the street. Divide that $9,000 across 35 hours and you get roughly $19 an hour. Same person, same skill set, same 60 minutes. One version of that hour is worth 21 times the other version, and the owner is doing both with the same hands.

That's the arbitrage. Every delegable hour has a precise dollar cost you've never actually computed, because nobody ever made you sit down and segment your calendar against your P&L. Once you do, the number stops being a vague feeling of being busy and becomes a line item you can act on.

The Blended-Rate Worksheet

Do this with your own numbers. Takes fifteen minutes, a calendar, and last month's P&L.

Step 1: Find your take-home. Pull what the practice actually pays you, monthly, after expenses but before you reinvest in growth. Not revenue. Not what you bill. What lands in your account.

Step 2: Count your real hours. Track or estimate every hour you work in a typical week, including the ones you don't think of as "work": the Sunday night inbox pass, the drive-time calls with your biller, the hour you spent trying to fix the website. If you're not sure, track it for one real week before you compute anything. Guessing here defeats the exercise.

Step 3: Compute your blended rate. Take-home per month, divided by 4.3, divided by weekly hours. That's your blended hourly rate. Write it down. Most owners are shocked by how low it is relative to what they charge patients.

Step 4: Segment the hours into four buckets. For one representative week, tag every hour:

1. Consult hours: direct patient care, using clinical judgment only you have
2. Note-writing hours: documentation, charting, care plans
3. Admin hours: scheduling, staff management, vendor calls, billing follow-up
4. Marketing-guesswork hours: content, website, social, "what should we post"

Step 5: Price each bucket. Assign your real consult rate to bucket 1. For buckets 2 through 4, ask what you'd pay someone competent to do exactly that work, hour for hour: a scribe, an office manager, a marketing person who actually knows the channel. That market rate, not your consult rate, is the true cost of you doing it yourself.

Step 6: Find the gap. Subtract the market rate for buckets 2 through 4 from your blended rate. That difference, multiplied by the hours in those buckets, is the arbitrage sitting on your calendar right now, this week, doing nothing.

This is the whole worksheet. You don't need me to run it for you. Run it once with real numbers and you'll know exactly which hours are worth $400 and which are worth $19, and you'll never look at your calendar the same way.

What This Actually Diagnoses

This isn't a productivity platitude about doing what you're good at. It's a pricing error. You are charging the practice $400 an hour of your own scarce time to do $19-an-hour work, and the practice is paying that price every week whether or not anyone notices. Time Leverage is the practice of refusing to let a low-value hour occupy a high-value hand. Decision Leverage is the deeper version: building systems so the decisions that only you can make get made by you, and the ones that don't, don't reach your desk at all.

Dr. Diane Mueller, one of the doctors I work with, removed herself as the bottleneck in her own practice by hiring associate doctors and rebuilding her intake so she wasn't the only person who could see a new patient. Gibson, Egeland, and Lievens each did some version of the same thing: they didn't work harder, they moved $19 work off their own calendar so their $400 hours could multiply instead of getting buried under admin.

The First Three Hours to Hand Off

Once you've run your own worksheet, don't try to delegate everything at once. Start with the buckets that are the biggest dollar gap and the lowest risk to hand off:

1. Note-writing hours. A scribe or a well-built documentation system closes most of this gap immediately, and it's the lowest-risk handoff because it doesn't touch patient-facing judgment.
2. Admin hours. Scheduling, vendor calls, and routine staff questions are the next easiest to systematize or delegate, and they're usually your single largest bucket by hour count.
3. Marketing-guesswork hours. This is the one owners resist handing off longest, usually because it feels like it requires their voice. It doesn't require their hours. It requires their voice captured once, then executed by someone or something else every week after.

Run the worksheet this week. You don't need my help to do it. If you want a second set of eyes on your specific numbers once you've run it, work with me.