Glossary

Gross revenue refers to the total amount of billings from patient services before any deductions.  It includes all services, fees or revenue earned without considering any discounts, allowance or other deductions.

Allowances and discounts are reductions in the listed price of offered services.

Non-patient revenue refers to revenue generated from sources other than patient care services.

Net revenue, also known as net sales or net income, is the actual revenue the company earns after subtracting allowances, discounts, returns, and other deductions from its gross revenue.

Non-physician compensation refers to the salaries, wages, and benefits paid to healthcare professionals who are not physicians. This could include nurses, therapists, administrative staff, and other healthcare workers.

Pharmaceuticals refer to medicinal drugs or medications used for treating various medical conditions. Pharmaceuticals typically represent the costs associated with purchasing and maintaining inventory of drugs and medications.

Facilities and equipment represent the physical assets to support its operations. This category includes buildings, machinery, vehicles, and other tangible assets used to deliver products or services.

General administrative expenses are the costs incurred to manage its day-to-day operations that are not directly tied to producing goods or services.  These expenses can include items such as marketing, legal fees and office supplies.

Cost of capital refers to the expenses incurred to raise funds for its operations. It encompasses the cost of both debt (interest payments on loans) and equity (required return to shareholders) financing.

Depreciation and amortization are accounting methods used to allocate the cost of tangible and intangible assets over their useful lives. Depreciation is used for physical assets like equipment, while amortization is used for intangible assets like patents. These methods reflect the gradual decrease in the value of assets over time.

Total expenses refer to the sum of all costs to operate the business. This includes all types of expenses, such as operating expenses, interest payments, taxes, and other costs. Total expenses are subtracted from the total revenue to calculate its net income or net loss.

Predistribution pool refers to the company’s earnings before deduction of the management fee.  This indicates the profitability before accounting for any fees or expenses related to the management fee.

A fee for the comprehensive, administrative and operational services to the practice.

The portion of the medical practice’s profit that is retained to cover all expenses and physician compensation.

A performance bonus is an additional payment made based on achievement of specific goals or performance targets.

Operating expenses are the ongoing costs incurred to run day-to-day operations. These expenses include items such as salaries, rent, utilities, marketing costs, and administrative expenses.

Available for shareholder distribution refers to the portion of the profits that are available to be distributed to its shareholder as monthly compensation.

Shareholder distribution, also known as dividends, is the payment made to the shareholders as a share of the profits. It represents the distribution of earnings to the owners of the company's stock.

Income before market adjustment refers to earnings before accounting for any changes in the market value of assets or investments. It represents the income based solely on its operational performance, excluding any gains or losses due to market fluctuations.