With most manufacturers you pay a residual annual fee for your practice management software. I know – you like paying this fee almost as much as you like paying for air at the gas station. And rightfully so, you’ve paid for the software, you’ve paid to have it installed and you pay to keep it working. Well, I’m going to give you two compelling reasons why it might not be as bad as you think.
Hereinafter let’s refer to these fees as AMP’s (annual maintenance plans). Here’s what you get when you pay that pesky AMP fee:
- Unlimited technical support instead of either no support from the manufacturer or a pay-per-use support model
- Access to incremental security releases and patches that aim to fix glitches or gaps in the software
- Access to the new versions, as they come out, for free (instead of having to buy them outright)
Now I’m not a software manufacturer so I don’t have any vested interest in this thing – they do and you do. That said, being a CIC for a number of these manufacturers, my company is brought into the equation because at times we’re asked to help facilitate the transaction. Here’s why I’ve decided I like the AMP and why I think as a law firm it would make sense to stay current.
I’ve done the math and it’s almost always cheaper to be on the AMP than it is to buy the new software outright when the time comes to replace your old version. Most firms upgrade every 2-3 years because as these systems get older they lose compatibility with 3rd party applications, become less stable, and become unsupported by the manufacturer. If you upgrade every two years it will always make sense to be on AMP. If you do it every three years it will almost always make sense to be on AMP. If you upgrade only once every four or more years, you’ll have to pull out the calculator. Let’s take a look at a sample firm of ten members that upgrades once every three years:
- Time Matters: 10 users cost $1,700* per year for the AMP, a 3-year cost of $5,100*. The firm can either pay this $5,100 over three years or they can forego the AMP and subsequent tech support (not to mention in v.11 you’ll be forgoing the mobility suite) and buy the software after three years, at a total cost of $5,900. For $800 less you also get tech support, the security releases and the mobility suite – a no brainer.
- Amicus Attorney Premium: 10 users cost $2,600* per year for the AMP, a 3-year cost of $7,800*. The firm can either pay this $7,800 over three years or they can forego the AMP and subsequent tech support and buy the software after three years, at a total cost of $6,390. For $1,410 over three years ($470/year) you get tech support and the security releases – not a bad value.
- Practice Master Platinum: 10 users cost $1,066* per year for the AMP, a 3-year cost of $3,198*. The firm can either pay this $3,198 over three years or they can forego the AMP and the subsequent tech support and buy the software after three years, at a total cost of $3,680. For $482 less you also get tech support and the security releases – another no brainer.
Having support is like having health insurance. It’s not like you want to get sick. It’s not like you’re planning to get sick. In fact, I’m willing to wager that you’d probably still pay for health insurance even if you knew that in doing so you would never get sick and thus never use it. To me, that’s a fair tradeoff. I pay for my health insurance because at the end of the day I want to know that in the unlikely instance I get mauled by a chupacabra, I’m not coming out-of-pocket $100 grand in medical expenses. It’s no different when it comes to support. You don’t want the software to experience any problems but, at the end of the day, you should want to know that if it does shut down, the manufacturer is working to bring it back online. It is a big investment after all.
So that’s why I beleive the AMP might make sense for most law firms. With AMP’s being as controversial and polarizing as they are, what are your thoughts? Is it worth the costs or are you paying $1.75 for 30 seconds of air at a gas station? Leave your comments below.
*Estimation based on 2011 data.