True Costs of a Complaint

Posted by BestPractices on March 14 2011
  • Each disappointed patient who complains represents six others who are unhappy with a similar experience
  • Therefore each complaint may actually represent seven unhappy patients
  • Each unhappy patient tells eight to ten others about their unhappy experience
  • 63 people now know about these unhappy experiences
  • 1/4 of these 63 people (16) will choose not to do business with you again
  • 16 patients x the average revenue per patient x the number of visits over a patient’s lifetime =the potential total lost revenue per complaint
  • 16 patients x $500 in revenue per patient visit x 5 visits per patient lifetime = $40,000 in potential lost revenue per complaint over a patients’ (customers’) lifetime
  • It can cost the institution $400 in actual labor and write-off costs just to handle the average complaint (or $20,000 annually)
  • If five percent of potential inpatients opt not to return each year, the revenue at risk is $2,500,000 per year
  • If a problem is resolved on the spot, 95 percent of patients (customers) will be satisfied, delighted, and tell others about how the problem was resolved
  • 96 percent of dissatisfied customers never complain
  • It is six times more expensive to attract a new patient than to keep an existing one!


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