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 Hello everyone. Welcome to the Testing Psychologist Podcast, the podcast where we talk all about the business and practice of psychological and neuropsychological assessment. I’m your host, Dr. Jeremy Sharp, licensed psychologist, group practice owner, and private practice coach.

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Hey, welcome back y’all.

Today, I’m tackling a topic that comes up a lot in our Facebook group and my consulting. This is the question of what are the finances of paper versus digital administration of a testing battery? I think we all assume that digital administration is more efficient, but is it actually more cost-effective? Well, that’s what I’m going to tackle today. Listen in and find out.

If you’re a practice owner who would like some coaching or accountability or support or all of those things, I would invite you to consider one of The Testing Psychologist mastermind groups. These are group coaching experiences. I lead all of the groups. I facilitate all the groups, and there’s a level for everyone. There’s beginner, intermediate, and advanced. I would love to talk with you and figure out if it could be a good fit. New cohorts are launching in late February or early March, and we have two spots in each of those tiers. So if you are listening to this in January or early February, go to thetestingpsychologist.com/consulting and schedule a pre-group call to figure out if it would be a good fit.

All right everyone. This will be a short episode and a little bit of a ballpark episode. What I mean by that is everyone’s battery is going to look different. This is primarily evaluating the measures that are available on Q-interactive and the paper and pencil well or not, paper and pencil or digital questionnaires that we tend to use in our practice.

I’ll be talking through those components, but I’ll focus primarily on Q-interactive and talk about the finances involved there and whether it makes more sense from a financial perspective to do digital administration or paper administration.

Just for background, we’ve been using Q-interactive for basically as long as it’s been out. I have a lot of experience with Q-interactive, and of course, now as a big practice owner with a keen eye on finances, we thought it was about time to do another review, especially with the recent increase in materials cost to see if Q-interactive is financially viable or better than paper and pencil administration.

I’ll cut right to it. When you do the math, digital administration is more expensive than paper over a five-year period, but there is a tipping point, so I’m going to unpack that statement a little bit.

The first thing is over a five-year period. The big difference in paper versus digital administration is buying the test kits. When you administer on paper, you have to buy the kits for all of the measures you want to administer. So in year one, paper and pencil administration is going to be significantly more expensive than digital administration via Q-interactive because the cost of those test kits is going to add anywhere from $6,000 to $8,000 to your bottom line whenever you do the math.

So, in year one, paper is going to be more expensive, but when you price it out over five years, digital is more expensive than paper, but there is a tipping point. The tipping point is once you do more than two and a half evaluations a week, or 125 evaluations a year, digital is going to get more expensive.

So this is the straightforward answer. The short story from all of that is, the more volume you do, the more evals you do, the more advantageous it is to do paper and pencil from a straight-up financial standpoint. I’ll say that one more time. Paper and pencil is cheaper over a five-year period and it scales with the more volume you do. So it’s going to be relatively cheaper the more volume that you do as well.

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Alright, let’s get back to the podcast.

All right, that is the simple answer, but let’s dig deeper. Where digital administration really tips the scales back in its favor is when you count the time saved from scoring. So when you factor in that time and what that time might be worth, it is far less expensive than paper.

So if we go back to our previous, let’s call it the tipping point of 125 evals a year. This is when paper and pencil theoretically get less expensive, but if you ballpark saving an hour for every eval that you do just by administering it digitally, you save that hour in scoring time or setup or administrative time by virtue of doing it digitally, which I think is reasonable, I think an hour is reasonable when you’re doing a cognitive measure like the WAIS or WISC, WIAT, D-KEFS, a CVLT, and many of the other measures that are available, WMS, through Q- interactive.

That’s at least $12,500- $13,000 on the very low end. That’s saying that your time is worth $100 an hour. You’re going to be saving 125 hours because you save an hour per evaluation just by doing it digitally. So that’s worth maybe $12,000. If your fee is higher, then, of course, that scales. So if your fee is closer to like $200 an hour, then you’ll be saving more like $20,000 or $25,000 in time over the course of the year.

So it’s not “direct savings.” You have to do something with that time and then it raises the question of how you want to spend your time. You could add more cases, of course, and make more money. Or you could just spend that time doing other things. But assuming that your time is worth $100 to $200 an hour, which it should be, that’s how you should be thinking about it in private practice, then the time that you save scoring is going to tip the scales back in the favor of digital.

The kicker here is if you extend this out over, let’s just say 10 to 15 years, which is the point that we are at now with Q-interactive, then it’s even more of a savings over paper and pencil because you don’t have to buy new kits when they come out. So if you assume a test is going to be updated, we’ll just say every 15 years, maybe it’s 12, maybe it’s 10, but 15 is a conservative estimate, that’s going to save you at least another $500 a year over 15 years because if you’re administering digitally with Q-interactive, then it just updates automatically. You get the new version without any increased cost, you’re just paying the licensing fee.

Long story short, I was admittedly skeptical about this. I went into this thinking paper and pencil was going to be more cost-effective. And when you just look at the numbers, that is true. You will spend less on paper and pencil than digital. But again, when you take into account the time saved and the value of that time when you administer digitally, then it does end up saving you quite a bit more and is less expensive. And I did not get into the volume discount that comes when you buy lots of subtests on Q-interactive in advance. That will, of course, tip the scales even more.

I know there are all sorts of tendrils that we could follow to talk about digital administration and whether it’s the right thing to do or not. I’m not dipping into efficacy and equivalency and that sort of thing, but from a pure financial standpoint, I think it’s safe to say, digital administration is more cost-effective.

All right, y’all, thank you so much for tuning into this episode. Always grateful to have you here. I hope that you take away some information that you can implement in your practice and in your life. Any resources that we mentioned during the episode will be listed in the show notes, so make sure to check those out.

If you like what you hear on the podcast, I would be so grateful if you left a review on iTunes or Spotify, or wherever you listen to your podcast.

And if you’re a practice owner or aspiring practice owner, I’d invite you to check out The Testing Psychologist mastermind groups. I have mastermind groups at every stage of practice development: beginner, intermediate, and advanced. We have homework, we have accountability, we have support, and we have resources. These groups are amazing. We do a lot of work and a lot of connecting. If that sounds interesting to you, you can check out the details at thetestingpsychologist.com/consulting. You can sign up for a pre-group phone call and we will chat and figure out if a group could be a good fit for you. Thanks so much.

The information contained in this podcast and on The Testing Psychologist website is intended for informational and educational purposes only. Nothing in this podcast or on the website is intended to be a substitute for professional, psychological, psychiatric, or medical advice, diagnosis, or treatment. Please note that no doctor-patient relationship is formed here. And similarly, no supervisory or consultative relationship is formed between the host or guests of this podcast and listeners of this podcast. If you need the qualified advice of any mental health practitioner or medical provider, please seek one in your area. Similarly, if you need supervision on clinical matters, please find a supervisor with expertise that fits your needs.

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