bcms

As the President and CEO of BCMS, Mary Daulong has dedicated more than 30 years to helping physical therapists make sense of the complexities of billing and compliance. Physical therapy billing and compliance is anything but simple. But it’s incredibly important. Especially today, with reimbursement rates declining, costs increasing, and profit margins slimming.

In a recent Breakthrough Patient Demand Summit presentation, Mary Daulong shared important compliance strategies. Implementing these best practices can prevent unnecessary financial loss and increase profit.

3 Compliance Strategies BCMS Recommends for Increased Profit

Read on to discover three key compliance strategies for boosting profitability.

1. Changing Payment Methodology

Navigating Medicare’s payment system can be challenging, but it’s important to have a good understanding of your options in order to maximize your reimbursement rate.

Daulong advises changing your enrollment status from “participating” to “non-participating” supplier between mid-November and December. This lets you collect more payments.

Specifically, you can collect more total allowable money as a non-participating provider. In addition, you can collect payment directly from the beneficiary at the time of service, similar to cash-based practices. This may require some consideration, as collecting cash from patients can be difficult. However, there’s an incentive to make this change—you can collect 115% of Medicare’s normal allowable fee for physical therapy services as a non-participating provider.

The BCMS CEO says that implementing this approach can significantly improve your cash flow because you no longer have to wait for payment. Instead, you receive payment at the time of service.

It’s important to understand that Medicare will pay the patient directly instead of reimbursing you since you’ve already collected payment. Also, Medicare will pay the patient 75% instead of the usual 80% of the allowable fee schedule. So, collecting from the patient is crucial to make this system work effectively.

As you can see, there are some risks involved in this change. Medicare reduces the fee schedule for patients by 5%, which means they’ll have to pay more. Additionally, Medicare pays the patient directly for their co-share. If you’re not willing to collect payment at the time of service, then don’t switch to a non-participating status.

physical therapist adjusting patient's shoulder
Source: Shutterstock

2. Evaluate Your Unit Counting Methodology

Medicare’s 8-minute rule often stumps physical therapists. It determines how units are counted and reimbursed for service. The BCMS CEO breaks down how it’s calculated and how you can use it to increase revenue:

  • 8 to 22 minutes: 1 unit
  • 23 to 37 minutes: 2 units
  • 38 to 52 minutes: 3 units
  • 53 to 67 minutes: 4 units
  • Each additional 15 minutes: add 1 unit

However, the American Medical Association (AMA) has a different rule: anything over 50% of the total 15 minutes per unit can be billed as one unit.

Whether you use the Medicare or AMA methodology, you must utilize the most up-to-date version of the Current Procedural Terminology (CPT) codes (with a few exceptions). You should also determine which methodology your payer follows. Do a thorough review of their coverage policies. If Medicare is mentioned but there’s no explicit information, it’s generally safe to assume they adhere to the 8-minute rule.

BCMS Examples: How the Billing Methodologies Differ

The key difference between the Medicare and AMA methodologies is how minutes are counted. Medicare calculates the total minutes and then determines the number of units. However, AMA counts minutes per CPT code and expects at least 50% of the 15-minute allowance for each unit. To receive two units of the same CPT code under AMA, you must reach the full 15 minutes plus an additional eight minutes.

BCMS illustrates some examples in this presentation. We’ll look at two of them.

In the first example, AMA would allow three units based on a total of 24 minutes, while Medicare would generate two units because the total minutes do not meet the required threshold.

BCMS billing presentation example A
Source: BCMS

In the next example, AMA would only allow one unit because the total minutes don’t meet the minimum requirement. But Medicare would provide two units based on the total minutes.

BCMS billing presentation example B
Source: BCMS

You must understand the differences between the Medicare and AMA methodologies to bill units accurately and maximize your revenue. Carefully analyze the minutes for each CPT code and ensure compliance with the specific requirements of your payer to optimize your billing process.

3. Utilize ICD-10 Codes To Tell the Story on the Claim

Another key to increasing your revenue is to utilize ICD-10 codes (International Classification of Diseases). According to the BCMS CEO, the right codes can help convey the complexity of the patient’s condition.

Suppose you have a patient with a total hip replacement who also presents with other significant comorbidities. In this case, it’s crucial to include this information, supported by the referral or medical provider’s documentation. When you add the relevant impairment diagnoses to the claim, it illustrates the intricate nature of the case. The reader then understands the complexity involved.

It’s also essential to progress beyond basic exercises and range of motion activities for your patient to help them achieve functional independence. Diversify the exercises throughout the entire episode of care.

When you incorporate therapeutic activities, utilize action words such as bending, lifting, and pivoting. These activities indicate the involvement of multiple joints and muscle groups, providing a challenging workout for the body.

By accurately documenting the complexity of a patient’s condition and incorporating varied therapeutic activities, you can effectively convey the challenges and progress achieved throughout the treatment. This comprehensive approach ensures your procedure encompasses the multifaceted nature of the patient’s needs and can be billed higher.

physical therapist with senior testing techniques
Source: Shutterstock

4. Avoid Redundant Coding: Use Progressive Coding

Many practitioners resort to redundant or convenient coding practices, which can be problematic. The BCMS CEO says compliance with Medicare guidelines and HIPAA regulations is essential and requires utilizing the appropriate codes and their definitions.

Use progressive coding instead, where patients start with basic interventions and gradually progress to more advanced activities that promote independence and functional improvement. Make sure your coding aligns with the specific activities performed and their intended purpose.

Inaccurate coding can have financial consequences for your practice. Most notably, you won’t receive the full entitled amount. It may be small, but it can cost you thousands of dollars in lost revenue over time. So, always ensure accurate coding protocol to keep your practice compliant and protected.

Don’t Stop at These BCMS Tips—Increase Revenue With Breakthrough

To manage your revenue cycle efficiently, you must code and document every procedure to ensure appropriate reimbursement. The goal is to get paid 100% of what’s allowed quickly and efficiently.

Breakthrough’s program: Profitability Under Pressure: A Program Exclusively for Physical Therapy Practice Owners, provides eight weekly group calls, access to online resources, and the ability to attend in-person events to support you in some of the daily challenges you face within your practice.

Click here to learn more and apply for Profitability Under Pressure.

cash-based PT services

Looking to grow your physical therapy practice and increase profitability? Adding a cash-based PT product or service to your standard offerings can greatly add value to your practice and your patients.

In a recent Grow Your Practice Podcast episode, several physical therapy practice owners spoke about their experience adding cash-based services.

We took the best insights from that conversation to develop this article. Read on to learn about the benefits and challenges of adding a cash based PT service in your practice. Discover three of our favorite technologies that practice owners are selling as a cash-based service today. Gain an understanding of the process for implementing a cash-based service in your private practice.

Why Add a Cash Based PT Service?

Increase Profitability

Physical therapy clinics often operate with tight margins. In the last few years, margins have been squeezed further by declining reimbursements and rising costs. Many practices are operating with substantial financial risk. Some have had to close for good or sell prematurely.

Whether you’re looking to reduce financial risk or stay ahead of the curve, adding a cash-based PT service is a proven way to become more profitable.

cash-based PT

Differentiate Your Practice

Have stiff competition from local practices and hospitals? Having additional forms of treatment can be the differentiator that makes your practice stand out from the crowd.

Enhance the Patient Experience

Medical devices can complement physical therapy treatment to offer improved patient outcomes. Some patients will experience relief or another desired outcome within a single visit, making them more likely to return and recommend your services.

Increase Lifetime Patient Value

Lifetime Patient Value is the amount of revenue an individual patient generates throughout their journey with your practice. It’s more cost-effective and efficient to maximize lifetime patient value than to attract new patients. There are two ways that adding a cash based PT service can help you increase lifetime patient value.

1) You can increase the value of your plan of care. If you’re at maximum capacity or have experienced staffing challenges, then adding a cash-based service could be a great way to increase revenue without having to increase your patient volume.

2) You can increase past patient reactivations. Adding a cash based PT service presents an opportunity for you to reengage past patients and attract them back to your clinic.

3 Cash-Based Services for Private Practices

Cash-based PT services should add unique and discernible value to your patients. If your patients feel a difference within just a few treatments, the value of this service will exceed its costs. For this reason, selecting a service that offers exceptional patient health outcomes is important. Consider these outstanding options:

LightForce® Therapy Lasers and Focused Shock Wave Therapy

cash-based PT
Image courtesy of Enovis™ Chattanooga® LightForce®

Enovis™ Chattanooga® LightForce® offers numerous medical devices that help improve patient outcomes. Two of their most popular devices are the LightForce® Therapy Lasers and Focused Shock Wave Therapy. LightForce® Therapy Lasers are used to treat chronic and acute musculoskeletal conditions as well as post-activity recovery. As a non-drug, non-surgical solution, LightForce® Therapy Lasers have been proven to reduce pain without the side effects of medication.

Focused Shock Wave therapy is another non-invasive treatment option for patients with trapezius muscle pain, shoulder pain, elbow pain, knee pain, achilles tendon pain, or plantar and heel pain. It can treat large areas in a short treatment time.

With both devices, patients often report noticeable pain reduction with just a few treatments.

Many practice owners in the Breakthrough community have adopted these technologies with great results.

Practice owner Tony Cere has added $300,000 in annual cash-based revenue. “Patients will come in for the laser, and turn into physical therapy patients,” he said.

According to Tom Loyd, Practice Owner at Bryn Mawr Sports Therapy, “The Lightforce 40-watt laser generates improved patient outcomes and adds an accessory form of income.”

The Neubie by Neufit

cash-based PT
Image courtesy of Neufit

The Neubie by NeuFit is a direct current (DC) electrical stimulation device. It targets the nervous system to reset broken and blocked neural pathways. It can be used to reduce pain, restore function after neurological injury or disease, produce a faster path to recovery after an injury or surgery, and improve fitness and performance.

The unique value proposition that Neubie adds has demonstrated extraordinary revenue potential. For instance, a private practice owner in Tampa, Florida, Jason Waz, boosted monthly cash-based revenue at his practice from $8,000 a month to $50,000 a month by implementing the Neubie device. In fact, the first year he implemented Neubie, his revenue per visit improved by $15 per visit across all payers.

Jason even managed to have the best month in his 10-year history while moving locations, which he attributes to the value differentiator of the Neubie.

3D Running Technology From RunDNA

physical therapy
Image courtesy of RunDNA

RunDNA provides specific value to runners by combining technology and education to assess and improve their movement. The technology allows you to analyze patient movement, craft unique injury profiles, and create comprehensive plans for runners’ success.

If you’d like to attract more runners to your practice, RunDNA’s solution could be a great fit. It will enable you to attract your ideal patient and increase revenue per patient.

Challenges of Adding a Cash-Based PT Service

Any time you change your services or add a new one, you may encounter resistance as you guide your patients and staff through new protocols. As always, the goal is to maintain the highest standards of patient care throughout the process, which may require additional client and staff education measures. Your staff, in particular, will want to see evidence the technology works before recommending it to patients. Be prepared with research and evidence. If possible, give your staff an opportunity to trial the technology themselves.

Patient education is also critical. Some clients will be used to having insurance cover their treatment and may hesitate to pay for services directly. Ensure your staff clearly communicates the cost and value.

In addition, keep an eye on the services your competitors offer and industry trends. Stay updated on the latest treatments so you can quickly adapt to emerging technologies.

How to Effectively Implement Cash-Based Services

Effective change management starts with a plan. To get the most immediate value out of offering cash-based PT services, you should implement them strategically. Here are some key factors to account for:

  • Patient Experience: Determine how a new cash-based service offering would fit into your patient experience. Is it offered as a standalone service or as an add-on to the plan of care? Create a roll-out plan that offers a seamless patient experience for existing and new patients.
  • Target Market: To choose the right cash-based PT service, you need to identify your primary target market. Will this service help facilitate healing and recovery for the primary conditions you treat? Is there a willingness to pay cash for this type of treatment? You might be surprised to discover how many patients are willing to invest in solutions to improve their health and reduce pain. Consider asking your existing patient base or conducting a survey to gauge interest and willingness to pay.
  • Selling: Your patients don’t necessarily need a sales pitch, but they often need to be educated on the personal value they’ll get from a specific service. Train your staff on how and when to educate patients about your new offering. Consider including it as part of your recommended plan of care for new patients. You can also incentivize staff to encourage adoption.
  • Marketing: Run campaigns to past patients to spread the word about your new offering and encourage past patient reactivations. You can also run workshops for people in your community who could benefit from the treatment. Workshops can take place in the community by partnering with a local gym, employer, or other organization with a lookalike audience to yours. Alternatively, you can host an educational event at your practice or virtually. Promote it through your social channels, email, or online advertising.

Grow with a Community of Like-Minded Practice Owners

Strategically implementing cash-based PT services is one of the most effective ways to improve revenue per patient. However, this is just one aspect of increasing profitability so you can grow your practice, increase practice value, and leave a lasting legacy in your community.

Running a practice is harder than ever. Declining reimbursements, staffing challenges, and rising costs require owners to innovate and come up with creative solutions if they want to succeed.

Why do this on your own when you can learn from others?

You don’t have to reinvent the wheel and come up with new ideas by yourself. Many practice owners have achieved success and want to share their knowledge and experience with other practice owners to benefit our industry as a whole.

Introducing Profitability Under a Pressure: A Program Exclusively for Physical Therapy Practice Owners.

The program includes a course, weekly group calls, access to an online community of practice owners, and opportunities to attend in-person events with other practice owners facing the same challenges you are who are committed to finding solutions.

Click here to learn more and apply for Profitability Under Pressure.

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revenue cycle management

Gain Billing Efficiencies to Increase Cash Flow

Since 2016, physical therapists have become one of 26 healthcare categories to face reimbursement reductions. As a result of declining reimbursements and rising costs, profit margins are shrinking. One way to mitigate financial risk and increase revenue is to make improvements to your Revenue Cycle Management processes. By gaining efficiencies in your billing processes, you have an opportunity to unlock significant revenue potential.

At Breakthrough’s recent Patient Demand Summit, Bob Kowalick, PT and CEO of Revenue Cycle Solutions, helped define Revenue Cycle Management and identify strategies for improving billing processes to unlock hidden revenue. You can watch that session or continue reading to learn the key takeaways.

What Is Revenue Cycle Management for Physical Therapists?

Revenue cycle management involves all administrative and clinical functions that manage claims processing, payment, and revenue generation. It includes insurance eligibility verification, claims submission, payment follow-ups, and everything in between.

Traditionally, RCM involves both front- and back-end components. The front end involves patient-facing tasks such as appointment scheduling, eligibility, and authorization, patient registration, and upfront payment collections. Back-end functions include claims management, medical billing, reimbursement, and final payment collections.

In addition, there are structural and operational elements to consider. Structural elements affecting your RCM processes include your practice model, payer mix, and the systems you use. Operational elements include patient registration procedures, provider documentation, and accurate coding.

Why Revenue Cycle Management is Key to Your PT Practice’s Success

Efficient Revenue Cycle Management is essential for successful cash flow and for the financial health of a physical therapy clinic. It ensures you receive the maximum reimbursement for services provided. By optimizing revenue cycle management, you can:

  • Reduce the number of denied claims
  • Enhance payment speed
  • Advance cost-effectiveness
  • Improve overall financial performance

Additionally, clear communication with patients regarding insurance coverage and financial responsibilities improves patient satisfaction. By reducing the time spent on billing-related inquiries, you enable practitioners and staff to focus more on patients and provide a positive experience. This fosters loyalty, repeat visits, and word-of-mouth referrals.

Revenue Cycle Management Has Become More Complex

Private physical therapy practices once received the overwhelming majority of their revenue from a handful of insurance companies or Medicare/Medicaid. Today, payment sources include a broader mix of insurance companies, Medicare/Medicaid, and cash-pay sources — making revenue cycle management (RCM) more complex than ever.

Shifts in payment responsibilities, authorizations, higher deductibles, and a lack of transparency across multiple systems are just some of the issues practices face as they collect payments from patients and insurers.

5 Ways To Improve Revenue Cycle Management and Unlock Hidden Cash Flow

Let’s look at some of the most common problems affecting physical therapy revenue cycle management and steps to improve efficiency and unlock revenue.

1. Scheduling

Not following scheduling best practices can cost your practice greatly. Long wait times, double bookings, inefficient follow-ups, and no-shows all lead to lost revenue.

Scheduling is critical to minimize wait times and ensure practitioners see patients constructively. Front-office staff can confirm appointments by using multiple communication methods such as text, email, and phone calls to minimize no-shows.

What’s more, it’s important to incorporate proactively schedule follow-up visits as part of a complete plan of care. When last-minute cancellations are unavoidable, aim to fill canceled slots with short-notice bookings. This will help to ensure you fill your schedules and maximize your space, improving your Return on Investment (ROI).

2. Patient Registration and Eligibility Checks

After scheduling an appointment, the next step in revenue cycle management is registration and eligibility verification. It’s surprising how often front-end staff fail to adequately verify patient data. In fact, eligibility issues with missing or incorrect patient information are among the top reasons for claim denials.

While front-office staff may verify eligibility on a first-time visit, they must also understand the critical nature of verifying data and eligibility on subsequent visits. Gathering accurate data before a patient arrives for their appointment is key to facilitating smooth revenue flow through the cycle.

By completing prior authorization requirements, front office staff can avoid claim denials on their end. Additionally, payers are increasingly requesting confirmation of reimbursements before patient visits.

3. Upfront Collections

With increased high-deductible health plans, patients are liable for many of their own healthcare costs. Settling co-payments and deductibles at your front desk at the time of the appointment can significantly alleviate back-end payment collection struggles. It also saves administrative costs and frees back-end staff for more critical functions.

You can improve point-of-service payments and help simplify your revenue cycle management in three ways:

  • Offer a credit card facility
  • Provide financial estimates before appointments
  • Allow patients to pay off balances over a set period
health claims for reimbursements
Source: Shutterstock

4. Claims Management

After an appointment, back-end staff execute a charge capture by converting services and practitioner time into billable charges. This process is often complicated by coding changes and varying payer guidelines. However, 90% of medical claim denials are preventable, and two-thirds can be recovered. This shows that with vigilance from your team, almost all practice claims should be granted.

To prevent denials, ensure codes are accurate and remain updated. Revenue staff should be knowledgeable about payer-specific guidelines and criteria. And because poor clinical documentation can lead to inaccurate charge capture and revenue loss, they should also:

  • Confirm clinical documentation accuracy
  • Verify patient and health insurance information
  • Ensure proper coding and modifiers

Devote part of the billing team’s time to managing claim denials rather than just processing new claims. Make it standard procedure for your team to review denials daily to ensure reimbursement.

In addition, ensure your revenue cycle management staff checks that you receive the correct payments in agreement with your contract for eligible claims.

5. Medical Billing and Patient Collections

As with claims and denials, patient collections can be very challenging. Physical therapy practices can increase patient collections by offering electronic payments through patient portals. Patients can conveniently view their bill online, the amount owed, and what it’s for, and then pay immediately with a credit card.

Once all payments are collected, back-end staff complete the revenue cycle management process by designating payments to the patient case and closing the account.

Streamline Your Revenue Cycle Management

While different staff members may handle various parts of revenue cycle management, every part of the process affects its overall success. Breaking down the silos between front- and back-end administrative functions can improve a practice’s efficiency and financial performance.

For support with optimizing Revenue Cycle Management, reach out to Bob Kowalick at Revenue Cycle Solutions.

Successfully negotiating physical therapy reimbursement rates

How One Practice Increased Physical Therapy Reimbursement Rates by 15%

Private practice owners have been hit with a double blow over the past few years. Inflation has driven a significant increase in operational costs. At the same time, the physical therapy industry as a whole has experienced reimbursement cuts:

If you think there’s nothing you can do about physical therapy reimbursement rates, you may be surprised.

While many practices have seen profit margins decrease, Kinetix Physical Therapy in Gainesville, Florida has almost tripled revenue in the past six years. One of the key components of their success has been their ability to successfully renegotiate with insurance providers. This has allowed them to secure better reimbursement rates.

The practice has been able to increase PT reimbursement rates by an average of 15% over the last couple of years.

At Breakthrough’s recent Patient Demand Summit, Tony Cere, Co-Owner at Kinetix PT, shared his exact experience with renegotiating reimbursement rates. You can watch that session or continue reading for the key takeaways.

Tony Cere, Co-Owner of Kinetix PT, shares his experience renegotiating physical therapy reimbursement rates

Growth Oriented Practice Seeks to Increase Physical Therapy Reimbursement Rates

Tony and Melissa Cere opened Kinetix Physical Therapy in 2008. At the end of 2016, Kinetix PT partnered with Breakthrough to help them compete locally and grow. They attribute great gains in their business to this partnership.

In just two years, Kinetix PT’s revenue doubled from $950,000 to $1.8 million and expanded the size of their clinic. And that was just the beginning.

In 2022, they grew to $2.8 million in revenue and are now opening another clinic. This will allow them to double their current practice size.

Working on the Business, Not In It

As part of the Breakthrough community, Tony learned the importance of focusing his time on his responsibilities as a business owner. This meant backing out as a full-time clinician. This transition proved to be a real game-changer. As a result, he is able to identify revenue growth opportunities. One of the most valuable activities he is now able to spend time on is negotiating better physical therapy reimbursement rates with insurance providers.

In 2020, Kinetix PT—like everyone else—saw expenses increase and reimbursements continue to decrease. There seemed to be little light at the end of the tunnel. Their saving grace? At the time, it was cash-based services. By adding cash-based services such as Lightforce lasers, foot levelers, diagnostic testing, and MSK ultrasound, Kinetix was able to provide significant buffer to its profit margin. Last year, Kinetix PT brought in around $340,000 in cash-based revenue.

However, as a physical therapy practice, the Ceres felt the practice should be profitable without relying on cash-based services. These added services should only cushion their already-healthy revenue. So they took a closer look at their payer mix and average cost per visit.

A Shocking Revelation About Physical Therapy Reimbursement Rates

When he dove into the numbers, Tony realized they were actually losing money by seeing patients with certain insurance providers. It was time to decide to either drop those payers or renegotiate their contracts.

The Process of Negotiating Physical Therapy Reimbursement Rates

The Ceres decided they would try contract negotiations first. The process was challenging and required significant commitment and perseverance. But Tony says it’s one of the most valuable things he’s done for the practice. It’s helped to secure healthy physical therapy reimbursement rates. Not only for 2023, but for years to come.

Tony started negotiations with one of their biggest payers. It made up 35–40% of their patient population. The process entailed multiple rounds of trying to find (and then reach) the right contact person within the insurance company.

Tony set up detailed presentations stating their case. He showed the significant inconsistencies between reimbursements for their private physical therapy practice and other institutions such as hospitals. The report also included figures explaining how some patient visits were actually draining practice finances due to the low reimbursement rate. He highlighted cost increases over the past few years and the lack of reimbursement adjustments to compensate.

Frustrated with declining physical therapy reimbursement rates? Discover effective strategies for negotiating reimbursement rates.

The Results of Contract Negotiations

Tony conducted continuous follow-ups and escalated their request to more senior staff members at the company to get noticed. Eventually, it worked. He negotiated a 10% increase annually in 2021, 2022, and 2023. This totaled a 30% increase over 3 years and raised their per-visit reimbursement with that payer from $62 to $83. Factoring in the volume of patients over 12 months, this improvement has had a noteworthy impact on their revenue.

Tony followed the same procedures with other network partners. He achieved some reimbursement increases from these as well. Results have been mixed. But even a $5 reimbursement increase per visit adds up to a great improvement over 12 months.

9 Steps for Renegotiating Your Physical Therapy Reimbursement Rates

Private PT practice owners are all facing the the same challenges Tony and Melissa have tackled over the past few years.

But most don’t realize they can do something about it.

Tony and Melissa’s perseverance and strategic approach shows us there’s hope. Try applying these best practices to achieve the same success negotiating with insurance providers.

1. Identify the payer(s) you want to negotiate with

Prioritize negotiations with the insurers that have the highest patient volume and lowest reimbursement rates. Payment levels can vary significantly amongst different providers.

2. Decide what rate you would need

Look at your revenue per visit and cost per visit. Decide how much more revenue per visit you would need for a healthy profit margin. For instance, Tony aims to make 20% revenue on top of the cost to see the patient.

3. Find the right person to talk to.

Tony recommends talking to the provider relations department of your insurance carrier. Aim high and get in touch with the most senior-level contacts you can.

4. Be persistent in your outreach.

This process takes time. You may not get a response right away. They may even say no. But keep going. Contact them by phone and email. Keep following up regularly until you reach someone who is willing to talk. If needed, set up a follow-up schedule for yourself. Once you have success with one company, it can give you further motivation and hope for others.

5. Gather your data.

Once you get a meeting with the insurance carrier, ensure you have all the necessary data. Use figures to highlight that current rates are non-viable for a private physical therapy practice to provide high-quality care. Your numbers should include PT total compensation costs per unit, per patient, and total per visit costs. Organize it clearly and concisely in a graphical format (such as PowerPoint) for maximum impact.

6. Write a letter to your contact requesting a rate increase.

Include the following steps, 7 through 9, in your letter.

7. Make it clear how you are a benefit to your community.

Show how you excel above your competitors in the area. Use patient reviews and testimonials if available. Emphasize your differentiators and high success rates. If your practice is great at physical therapy marketing and attracting patients, highlight that as a differentiator.

8. Explain how your business costs have increased.

Support this with documentation. Show how the current physical therapy reimbursement rates you’re receiving from them are causing financial losses for your practice. If you haven’t received a reimbursement increase from this payer in a long time or ever, be sure to note this.

9. Describe how financial losses negatively impact your patients.

Reiterate that a fair and sustainable reimbursement structure is crucial for deliver high-quality care to the insurance company’s members. Express your commitment to providing exceptional care.

Perseverance is Key

Many practice owners believe their practice is too small to negotiate with payers. But in fact, payers can benefit by working with you. Even with an increase in your rate, they’ll still be reimbursing you less than what they pay to hospitals.

If you set out with a well-formulated argument and willingness to persevere, follow up, and persevere some more, you can successfully turn your bottom line around with better payer physical therapy reimbursement rates.

Get Support to Increase Your Physical Therapy Reimbursement Rates and Improve Profit Margins

Running a physical therapy practice is harder than ever. Inflation, declining reimbursements, and decreasing physician referrals require practice owners to step up their commitment and innovate if they want to succeed.

If you’re reading this, my guess is that you’re looking to increase profit margins and gain financial stability.

You don’t have to reinvent the wheel. Many practice owners have achieved success and want to share their knowledge and experience with other practice owners to benefit our industry as a whole.

That’s why Breakthrough has launched a new program called Profitability Under Pressure: A live 13-week masterclass exclusively for PT practice owners.

Through weekly calls, templates, group support, and one-on-one guidance, you will:

  • Conduct a financial analysis for your practice
  • Create a custom plan to increase your profits
  • Discover how to drop your lowest payer and renegotiate insurance contracts
  • Learn about the different cash-based services available and how to implement them
  • Start systematically attracting better-paying patients
  • Create consistency in your patient volume flow year-round

As part of this program, you’ll benefit from structure, accountability, community, and the accumulated shared knowledge of dozens of practice owners.

Click here to learn more and apply for Profitability Under Pressure.

The Shocking Truth About Physical Therapy Reimbursement Rates in 2023 cover

The Shocking Truth And What You Can Do About It

2023 Physical Therapy Reimbursement Rates

Shrinking profit margins pose a significant threat to private practice as physical therapy reimbursement rates in 2023 continue to decline and operating costs rise.

Since 2016, physical therapy reimbursement rates have decreased by more than 10%. You’re getting reimbursed less for the same amount of work. Yet we in the industry know that physical therapy provides the best outcomes per dollar.

Physical therapy reimbursement rates 2023 reflect a declining trend in reimbursement rates that's been going on since 2016.
Source: MGMA Government Affairs.

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The Impact of Declining Physical Therapy Reimbursement Rates on Private Practice

The combined impact of declining reimbursements and inflation may leave you at your wit’s end, spinning your wheels to preserve profits, and taking on more patients to make up for the revenue loss. Ultimately, it’s leading to shrinking profit margins, hiring and retention challenges, and PT burnout.

Shrinking Profit Margins

Profit margins in outpatient PT are taking a big hit from declining reimbursements and rising costs. In 2018, the average profit margin for a PT private practice was 14.6 percent. Today, that’s no longer the case. Bob Kowalick shared on a recent podcast episode that he’s seen a record number of practices with profit margins under 10 percent. When your profit margins go below 10%, you’re skating on thin ice. Your business is at risk.

Eventually, the severity of this issue may threaten the viability of your practice (if it hasn’t already).

Hiring and Retention Challenges

The rising cost of living also means employees at many clinics are asking for higher wages, at a time when there’s no profit margin to spare. The cost of PT school has gone up, so recent grads are taking on massive student loan debt and expecting higher wages. If you can’t meet therapists’ salary demands, those therapists may end up working at a hospital or bigger clinic. Hiring and retaining staff is incredibly challenging in this environment.

Owner and Staff Burnout

You’re probably working harder than ever while facing uphill financial battles. You’re overworked and underpaid, a classic recipe for burnout. And your staff isn’t immune to this either. At the end of the day, this could be impacting your patient care and your ability to enjoy patient care.

Physical Therapy Reimbursement Rates in 2023: Are the Cuts Here to Stay?

When we look at what’s happening today, there’s a clear trend: Overall expenditure on healthcare is going up, while reimbursements for physical therapy services are going down.

Even though national spending on healthcare increased 35% in the last five years, physical therapy reimbursement rates have decreased by 10 percent.
Between 2016 and 2021, healthcare expenditure increased by one trillion dollars.

In 2016, $3.3 trillion was spent on healthcare. In 2021 (the latest numbers recorded) it was up to $4.3 trillion. That makes healthcare 18% of the total US GDP, nearly twice as much as the average industrialized nation.

While the overall market for healthcare has gone up by 35% since 2016, physical therapists have seen little of that growth. Combined, there was $34 billion spent on physical therapy and occupational therapy in 2021. PT and OT made up less than 1% of the total healthcare spend.

And things are getting worse. We’re expecting more reimbursement cuts in 2024. The bottom line is you can no longer rely on doctors and insurance providers to have your best interests in mind.

So, what can you do in this situation?

Frustrated with declining physical therapy reimbursement rates? Discover effective strategies for negotiating reimbursement rates.

What Owners Are Doing to Survive

When profit margins get squeezed and what you’ve relied on in the past isn’t working, you know it’s time to make a change.

You need to find a way to solve your financial challenges and get your profit margins back to a healthy range (between 10 to 20 percent). Here’s what most owners are doing in an attempt to survive:

Cutting costs

This typically means pay cuts for owners and therapists alike. However, reducing wages or being unable to compensate employees fairly makes it difficult to retain top talent and continue providing high-quality care.

Marketing is another area where owners will look to cut expenses. But this will come back to bite you when patient volume goes down and your top-line revenue takes a hit.

Working long hours and treating more

Some owners are giving up on hiring and treating more patients themselves. It’s true that taking on more patients is one way to increase revenue (we’ll cover that more down below). However, if you take on too many patients as the practice owner, that doesn’t leave much time left over for taking care of business. And when profit margins are declining, you as the owner should really be focused on developing and executing a business plan to increase profitability.

Trying to negotiate better physical therapy reimbursement rates

One viable solution is renegotiating insurance contracts or dropping low-payers to increase your revenue per patient. This can definitely help in the short-term, but is not a long-term solution. Dropping your lowest-paying insurance providers may increase your average transaction value, but leaves you vulnerable to future reimbursement fluctuations.

Ultimately, these strategies lead to further decline in profitability and increase risk that a practice could end up closing for good or selling for pennies on the dollar. 

Instead, focus on the proven strategies for increasing profitability outlined below.

Frustrated with declining physical therapy reimbursement rates? Discover effective strategies for negotiating reimbursement rates.

 

3 Ways to Make Up for Lost Revenue in Your Practice

In his book Getting Everything You Can Out of All You’ve Got, Jay Abraham argues that there are three main ways you can boost revenue. These tenets can be applied in your PT practice to address financial challenges so you can either continue to serve your community for years to come or eventually sell at a profit.

1. Increase the number of clients you see

If you don’t have consistent patient volume, you should address this so you’re filling schedules and filling space consistently.

Take this hypothetical scenario about Practice A and Practice B.

Practice A: 2 PTs, 80% full, $90/visit, 80 v/w

Practice B: 2 PTs, 95% full, $90/visit, 95 v/w

What’s the difference in profit margin?

Profit B generates $1,350 more each week than Practice A.

If you don’t have a waitlist, then you’re not at full capacity and could benefit from adding patient volume.

2. Increase your average transaction value

There’s a lot of opportunity for practices to increase revenue through additional revenue streams. You can increase your average value per patient through insurance-based means, such as negotiating rates, dropping low-payers, or adding new insurance-based services such as RTM. However, it’s impossible to predict future changes to insurance-based reimbursements. What’s clear is that the US healthcare system doesn’t understand or heed the importance of physical therapy. Until that changes, efforts to improve reimbursement rates are likely to be difficult at best.

One great way to increase your average revenue per patient is to add cash-based services such as laser therapy, spinal decompression, dry-needling, or other cash-based products or services that you can incorporate into your patients’ treatment plans.

Tony Cere, Practice Owner of Kinetix PT, shares how he increased revenue per patient by dropping his lowest payers, renegotiating insurance contracts, and adding cash-based services.

3. Increase the frequency of repurchases

In outpatient PT, we refer to this as maximizing Lifetime Patient Value (LTPV). This means reducing patient drop-off, graduating your patients from their plan of care, and reactivating patients so they return for additional treatment when needed.

You can reduce patient drop-off by following best practices for conversion in the initial exam and creating a plan of care.

The Plan of Care Template can be used to help retain patients and prevent patient drop-off

Reactivation is where many practices are missing out on opportunities. Imagine that you have a patient who graduates from their plan-of-care, then later has a different issue that needs treatment. Will they know to come to you for their problem?

If they go to their doctor first, they may end up getting surgery or going to a competitor. They may not get treatment at all or realize they have problem.

On the other hand, if you consistently run reactivation campaigns and market to your past patients, you can stay top-of-mind for them. You can educate them about the various problems you can solve so they think of you when one of those issues arises.

Reactivating past patients is typically much easier and more cost-effective than attracting brand new patients to your practice.

With these email marketing ideas, you can reactivate past patients and increase lifecycle patient value.
Leverage your past patient list is the lowest-cost way to fill your schedules and fill your space.

How to Create a Plan for Profitability

All three revenue-generating strategies can help you overcome the impacts of declining physical therapy reimbursement rates in 2023 and beyond.

To do these well and increase profit margins so you can gain financial stability, you’ll need to develop a profitability plan.

The foundational aspect of your plan must focus on building patient demand. Patient demand refers to the amount of desire and interest that exists for your practice’s services amongst your past patient base and your community. Building adequate patient demand is the key to being able to effectively drive revenue growth and improve profit margins.

By creating a plan for profitability and increasing patient demand, you’ll be able to:

Fill your schedules and space consistently.

If you don’t have a waitlist, you definitely need to build patient. That means you’re not at full capacity and you’re missing out on revenue potential.

Drop your lowest payers.

If you don’t have a waitlist and you’re not fully utilizing your schedules and space, you can’t cut your lowest payers. By building more patient demand, you’ll be able to attract better-paying patients and create a cost-per-visit threshold that you adhere to.

Add cash services.

There are a variety of cash-based services that are proven to work for physical therapy patients. Part of your profitability plan should be to determine which cash-based service would fit best within your practice.

You’ll also need to build demand for those services. Without patient demand, you can offer cash services, but you’ll have difficulty selling them.

Increase Lifetime Patient Value.

Your former client list is a valuable asset. You can leverage it to reactivate past patients through email and text campaigns. Doing so will encourage patients to come back to you anytime they have a problem that physical therapy can support. This will increase the lifetime patient value and create more revenue.

How One Owner Successfully Increased Revenue Per Patient

Tony Cere, Owner of Kinetix PT worked with Breakthrough to add the Lightforce laser to his practice and now brings in an extra $220,000 annually in cash-based revenue. He adds this service to plans of care for new patients and markets it to past patients through email and SMS campaigns. Tony has seen 300% revenue growth at his practice within 6 years.

“Breakthrough’s email and SMS campaigns are really helpful for getting past patients in the door and getting the word out about our laser cash services. To make a big investment like that, you’ve got to know you can bring in the income. With Breakthrough, we didn’t have to worry…we had patients coming in for laser who ended up becoming PT patients.” —Tony Cere, Owner, Kinetix PT

The Bottom Line: How You Can Overcome Declining Physical Therapy Reimbursement Rates

If you are physical therapy practice owner who…

  • Feels the pressure of declining physical therapy reimbursement rates
  • Wants to stay ahead of the trend of shrinking profit margins
  • Has a growth mindset

Then you could be a great fit for Breakthrough’s Profitability Under Pressure Masterclass. In this 13-week course, you will join a cohort of other practice owners who are working through the same things together. Through small group calls with step-by-step instructions, templates, and one-on-one guidance, you will:

  • Go through a financial analysis exercise for your practice
  • Create a custom plan to improve your profits
  • Learn how to drop your lowest payer and renegotiate insurance contracts
  • Discover how to implement a cash-based service
  • Find out how to systematically attract better-paying patients
  • Learn how to fill your schedules and space consistently

We’re stronger together than alone. To learn more about the Profitability Under Pressure Masterclass, click the image below.

Breakthrough's Profitability Under Pressure course enables practice owners to improve profits and gain financial stability through proven methods.

Struggling with low margins in your physical therapy practice? Here are six ways to grow profitability by increasing revenue per patient. 

As a physical therapy private practice owner, increasing revenue is always top of mind. Insurance reimbursements are declining annually, inflation is at a historical high, and therapists are demanding higher salaries. These combined factors make it increasingly difficult to achieve healthy margins. 

There are numerous ways to address these financial challenges so you can become more profitable, grow your practice, and hire and retain staff.  In this article, we’ll explore six ways to grow profitability by increasing revenue per patient. 

Increasing Revenue in Your Practice: An Overview

There are many ways to increase revenue in your practice. One way is to see more patients. For instance, if you treat 100 patients today you can set an achievable goal to grow that number to 120 patients per week. To learn more about how to get more patients, check out this article: How to Get More Physical Therapy Visits. 

Some practices, however, have reached full capacity with their caseload. They either don’t have enough staff or enough space to serve more patients. Yet they may still struggle to make ends meet. If this sounds like you, you will likely benefit more from learning how to increase revenue per patient. At a high level, you can increase revenue per patient by:

  • Charging more per visit. If your average revenue per visit is $80, you could set a goal to increase your average revenue to $90 per visit. 
  • Adding more visits per patient. You can increase visits per plan of care. Or, find ways to get past patients to come back into the clinic for additional treatment. 

In this article, we’ll explore 6 ways to increase revenue per patient. Some of them enable you to charge more per visit, while others will empower you to increase the number of visits per patient.

Watch Chad Madden answer questions about making up revenue from low reimbursements:

6 Ways to Increase Per Patient Revenue

1. Add cash products and services

Many practice owners today are adding cash services to supplement income from insurance reimbursements. Numerous therapeutic devices and services exist that pair well with physical therapy. These options add value to your patients and can help them get better faster. At the same time, they generate cash income for your practice and increase revenue per patient. Examples of cash-pay products and services that are working today include:

  • Therapeutic lasers
  • Shockwave therapy
  • Traction / Spinal decompression
  • Massage 
  • Dry needling (covered by insurance in some cases, but not by all providers) 
  • Fitness classes/gym facilities
  • Online coaching or digital courses
  • E-commerce offerings such as nutritional supplements

Cash-based products and services like these can help you increase revenue without relying solely on insurance reimbursements.

How adding cash-pay services can help your physical therapy practice increase revenue per patient.
3 scenarios showing the difference between 1) relying solely on reimbursements, 2) relying on cash pay only, and 3) combining both reimbursements and cash pay services.

Some practice owners I’ve talked to express concern about their patients’ willingness to pay for cash services. The answer to this likely depends on the area you live in and the affluence of your local population. Yet dozens of practice owners in the Breakthrough community have found success generating strong ROI from cash-based products such as Lasers and Shockwave. 

One practice owner based in Gainesville, Florida recently shared that he generated more than $100,000 in additional annual income by adding LightForce® Lasers to his offering. He marketed those services through Breakthrough’s Patient Demand Platform.

When launching new cash services, it’s a good idea to develop a marketing strategy to get the word out and grow demand for your services. Breakthrough can help you develop a marketing strategy and implement it with pre-built email campaigns and done-for-you online advertising funnels.

“Breakthrough has helped us get the word out about our cash pay services with email campaigns promoting Lightforce Lasers. We’ve had patients coming in just for those cash-pay services that we offer and then they end up becoming physical therapy patients too.” -Tony Cere, Practice Owner

2. Reactivate past patients

Reactivating past patients goes hand-in-hand with adding cash-based services. When you add new services, you can market them to past patients as a way to attract them back into your clinic.  

It’s often easier and more cost-effective to reactivate past patients than to acquire new ones. Your patient list is your lowest-cost, easiest-to-use tool to quickly boost patient visits and increase revenue. 

I know PTs who have generated a dozen plans of care from a single email to past patients, even with a modest-sized patient list. Who better to focus your limited time and efforts on than those people who already know, like, and trust you? These are the people who are most likely to come back for additional treatment or another condition. 

A common mistake practices make when engaging their patient list is to send their patient newsletter via email. Unfortunately, this is typically ineffective at generating replies or inquiries. 

What works better is to craft email campaigns that a) provide “goodwill” value to your target patients and b) offer a call-to-action.

Watch: How to Reactivate Patients with Email


Balance “goodwill” emails (such as exercises they can try at home to lower back pain) with “offers” (such as an invitation to come in for a new service). You’ll build trust and credibility with your past patient list while providing them with opportunities to come back for additional treatment when they’re ready. 

Running campaigns to reactivate past patients helps to increase the number of visits per patient, which is a more cost-effective way of boosting revenue than acquiring brand-new patients.

Deepak Sharma, Owner of Primus Physiotherapy has been working with Breakthrough since he launched his practice in 2018. He uses Breakthrough’s pre-built email campaigns to reactivate past patients. Today, around 85% of his patient base are either past patients or referred by past patients.

“We know that if your primary base is your past patients, then they will never let you down,” Sharma said. He hit his 7-year growth goal in only 3 years and generates over $1 million in annual revenue from a single location. 

“We don’t do any other marketing,” he said. “All our marketing is through Breakthrough.” 

3. Reduce no-shows and patient drop-off

No-shows and patient drop-off can be a significant drain on revenue. 

Not only is it bad for business, but it’s also just plain discouraging to put effort into helping a patient, only to have them cancel last minute or even disappear altogether. This can leave therapists feeling disrespected and undervalued.  

By creating a Plan of Care for each patient, scheduling all appointments in advance, and implementing appointment reminders, you can help prevent no-shows and patient drop-off. 

These tactics are key for maximizing visits per patient. Ultimately, this will allow you to increase revenue per patient. 

4. Drop low payers or negotiate better rates

If you’re working with payers that reimburse at lower rates, dropping these payers or negotiating better rates can help increase revenue per visit. By focusing on better payers, you can increase revenue without necessarily increasing the number of patients.

If you can generate $120/hour instead of $90/hour, you could create a lot of lot more margin for the business. 

Something we see a lot is that practices are seeing patients that are capped at say $60/hr, while they have prospective patients covered by $120/hr payers on their waiting lists. 

You can avoid this by implementing a strategy where you cap visits below a certain revenue threshold and focus on attracting patients above your threshold. 

Frustrated with declining physical therapy reimbursement rates? Discover effective strategies for negotiating reimbursement rates.

5. Expand insurance-based services

We’ve talked about adding cash services to increase revenue, but there are also some insurance-based services that can help to increase revenue per visit. 

For example, if you’re a physical therapist, there’s an opportunity to add Remote Therapeutic Monitoring (RTM) services. The RTM codes in the 2023 CMS guidelines offer generous opportunities for practice owners to add new revenue streams while potentially improving the patient experience. 

You can check with your payers to discover other services that may be covered under insurance and reimbursing at decent rates. This will vary by provider, but some that may be covered include dry needling and traction. 

It’s important to remember that if you rely solely on insurance-based revenue streams, services covered and reimbursement rates are subject to change. This can make revenue difficult to predict. In general, it’s a good idea to diversify your services and payer mix to hedge against changing reimbursements.

6. Build patient demand

It used to be that physical therapists could rely on a steady supply of physician referrals for patients. That’s no longer the case. Today, physicians are primarily sending referrals to hospital-owned and physician-owned clinics.  

This transition has been difficult for many practices, but to give up hope would be a disservice to our patients. Instead, practice owners must shift their thinking in terms of how to acquire patients. 

You have the power to go out and build patient demand for your services. To get patients for yourself, without relying on doctors to refer. Public demand for physical therapy is growing, largely due to aging baby boomers who are staying active later in life than previous generations. Practice owners need to get strategic about capturing the existing demand in their market. 

You can build patient demand through tactics such as online advertising, email marketing, or hosting educational workshops.  

Building patient demand enables you to focus on higher-paying patients. When you have a large following of interested and engaged prospects, you can drop lower payers and increase your revenue threshold. Plus, you’ll have an engaged group of followers that you can target when you have new services to offer. 

Patient Demand Is Key to Increasing Revenue Per Patient 

The more that you focus on building patient demand, the larger of a list you will gain, which you can continue to engage over time. With more people aware and interested in your services, you’ll gain the flexibility to:

  • Increase revenue per patient and treat better-paying patients
  • Rapidly create interest in new services 
  • Fill your schedules so you can hire and expand

One important note on hiring: A lot of practices are struggling to hire because they can’t keep up with therapist salaries offered by the competition. Keep in mind that a growing practice with healthy finances and a steady flow of patients will be able to pay better wages and will be more attractive to therapists. 

A key part of your role as a practice owner is to identify ways to build patient demand in order to create consistent patient volume, increase revenue per patient, and attract/retain clinicians. 

What questions do you have about how you can increase revenue per patient and build patient demand? 

Breakthrough - Increase Revenue Per Patient

Get your answers in a free consultation with a Breakthrough Patient Demand Expert. Schedule your free strategy call today. 

Learn 5 ways to create practice growth and make up for lost revenue in 2023.

5 Ways to Make Up for Lost Revenue in Your Clinic

Are you a physical therapy or chiropractic clinic owner looking for ways to increase revenue and create long-term practice growth?

Many of us are in the same boat. Today’s market conditions have created downward pressure on revenue, upward pressure on costs, and shrinking margins for many private practice physical therapy clinics. A lot of practice owners I’ve talked to recently are wondering how to grow revenue. 

So what do you do in this situation?

We need to figure out how to make up for lost revenue in our clinics, and for physical therapists, we need to make up for the recent 4% Medicare Reimbursement Cut.  

Here are some of the ideas to help you think through this, get your mindset right, and make meaningful changes long-term that create practice growth. 

1. Avoid the Urge to Pull Back — Instead, Focus on Practice Growth 

For most of us (95% of the population), we’re wired so that we usually pull back whenever there’s any sort of danger or threat. This is how our lizard brain works to make us feel safe. 

Robert Kiyosaki shares a story in Rich Dad, Poor Dad that’s relevant here: As a helicopter pilot, one of the key things he was taught was that if you get hit in wartime, you should push forward rather than pull back. 

Although it can be counterintuitive, the same is true for practice owners. When things get tough, we need to double down and develop creative business solutions to create practice growth rather than pull back and get small. 

But that’s easier said than done. 

I’ve been through it myself. Early on in private practice, when I would take a loss or lose money, I would pull back my marketing. I’d try to minimize our costs and somehow think that was going to help me come out on the other end. 

It never worked. 

Usually, I’d go a few months before I figured out that I needed to course correct. 

After surviving that a couple of times, I eventually figured out that when there is revenue loss, when we’re in the red, and when we have more costs than we have income coming in, it is very easy to pull back. 

The only way to get out of it is to go forward. To figure out a way to grow your revenue.

Financial Analysis of a Hypothetical Physical Therapy Clinic

To show you why it’s important to continue growing revenue, let’s look at some hypothetical numbers.

Let’s say you have a clinic producing $100,000/month in revenue, with $95,000/month in costs. In that situation, it’s very difficult to create margin. 

What if your revenue goes from $100K a month down to $97K in a month? 

You had a $5,000 margin per month, now it’s $2,000. So you had a 60% decrease in margin. 

That’s a pretty big deal. 

A lot of owners, at least when we’re being reflexive and reactive, we’ll try to shrink costs down. We think that we can somehow go from $95,000 in costs down to $50,000 or something like that and create margin again. 

That’s not how it works. 

Instead, we have to think about how to take the $100K that went down to $97K, up to $110K or $120K. It’s a better way to business problem solve.

So that’s the first thing to work on in terms of creating a practice growth mindset. You’re almost never going to be in a situation where pulling back and clamping down on costs helps you succeed. 

2. Aim to Fill Space and Fill Schedules 

The second thing for creating practice growth is to understand the game and the scoreboard that we’re playing. 

We’ve invested in space. That’s a fixed cost. We should aim to fill the space. 

If we have 3,000 sqft and we’re seeing 100 visits/week, then we have way too much space.

We can either choose to fill the space or cut down on space. 

Let’s say we estimate the capacity for the space to be 300 visits, right? 

Then we need to ask the question, “What do we need to do to create enough demand for my services that we’re seeing 300 visits a week in this space?” 

If we can’t get visits up or don’t want to, then the next time our lease is up, we can cut back. Maybe we bit off more than we can chew and we need to adjust. That’s fine. 

But eventually, we need to get to a point where we can control the space that we’re in and can maximally fill it. 

In addition to space, we need to fill schedules. If we have four full-time clinicians and each clinician can see 50 visits a week, then our capacity is 200 visits a week. 

Let’s say we’re at 130 visits/week today. Then the game we’re playing is to get up to 200 visits/week. 

We need to create enough demand for our services that both our schedules and our space are full.

3. Don’t Be Afraid of the Waitlist

When I talk to practice owners, I often hear some variation of this story:

“I don’t have a problem of not having enough demand for my services. I have a waitlist. My problem is keeping therapists and hiring. I recently lost a therapist who was with me for years. They went to work for the local hospital system.” 

This is a very real pain. But if you think through it further, you realize the solution really comes back to building demand for your services. 

Let’s say your space was full, schedules were full, and you had a $20,000 margin instead of a $5,000 margin. In that situation, you’d be able to compete better with the hospital system on salary and benefits.

It’s hard to have that conversation without talking about payer mix as well. 

If we can generate $120/hour instead of $90/hour, we could create a lot of lot more margin for the business. 

How do you do that if the schedule is already full and you have a waitlist? 

You increase revenue per patient. 

Bob Kawalick has talked about this, saying something like, “We’re seeing patients covered by $60/hr capped payers, while we have prospective patients covered by $120/hr payers on our waiting lists.”

I’ve heard some owners talk about the waitlist as a bad thing. 

But if we’re created enough demand that we have a waiting list, it might be time to consider either a) adding cash pay services or b) going out of network with those lower payers. In both cases, we’re increasing revenue per patient and generating more revenue without increasing our capacity.

So don’t be afraid of the waitlist and consider optimizing your payer mix. 

4. Increase Per Patient Revenue with Cash Pay Services 

This one is a must in today’s financial climate. There are a number of cash pay services you can add to your practice that both provide value to your patients and provide more cash flow to you. By adding cash pay services you can charge more for a plan of care and create more income to support your traditional services. 

Examples of cash pay services that are working for many practices include therapeutic lasers such as the Lightforce Laser, electrical stimulation such as Neufit, dry needling, fitness classes or facilities, e-commerce (e.g. supplements or other relevant products), or coaching. 

Adding cash pay services is a key way to create practice growth.

5. Develop Ownership Mentality and a Practice Growth Mindset Within Your Team

The final way to create practice growth is something that was a really big error for me in the beginning. And I’ve talked about Jack Stack and the great game of business and also stake in the outcome. They’re essentially the same book. The Great Game of Business is the one that I prefer, but it’s how to be. So most of us, if we have very thin margins, we’re like hiding that from our staff. So they’re not even sure what the score of the game is. 

And that’s not healthy or good. It means we’re internalizing and carrying all the stress with us. 

The team doesn’t understand exactly where we’re at as a company. They don’t know the scoreboard and we’re not being transparent. 

In the Great Game of Business, Jack Stack talks about how he made that transition back in the 80s and he developed owner mentality across everybody in this company. From the C suite the whole way down to the Janitor and everybody else in between in their organizational structure, everybody had ownership mentality. 

When I made that transition, it was a significant for us. It was a game changer. It took a lot of pressure off of me. 

Now, when we have a bad month or a bad quarter, we’re asking ourselves better business questions and getting to a solution more efficiently rather than me having to create the solutions for 100 plus team members that we have here. That’s impossible to do.  

We have very competent,  smart people on our team, so I don’t need to carry all the weight of the company. I’ve empowered my team with transparency and they are going forward, producing solutions, creating new policies, and developing new procedures that help our business across the board. 

Cultivating a Practice Growth Mindset

So we’ve talked about mindset and we’ve talked about some specific strategies you can implement for practice growth.

I hope you got something out of this that helps you shift your mindset and generate some ideas for you so you can increase revenue and create forward practice growth in 2023.  

Interested in learning how Breakthrough can help you increase revenue and create practice growth? Request a demo. 

 

How to increase physical therapy clinic revenue. Learn 7 ways to boost physical therapy revenue in 2023.

How to Boost Physical Therapy Clinic Revenue and Increase Margins

Physical therapy clinic owners nationwide are feeling the financial pressure of declining reimbursements and historic inflation. As you plan for 2023, you’re likely focused on how to grow physical therapy clinic revenue and cut costs. This article will share 7 ways to increase physical therapy clinic revenue in 2023. Incorporate these strategies into your 2023 practice plan to make more money in your physical therapy clinic. 

Recently, on the Grow Your Practice Podcast, we talked with owners about 2023 financial planning. The key takeaways are included in this article. If you’d like to watch the full episode, press ‘play’ on the video below.

Wondering How to Increase Physical Therapy Clinic Revenue? Start by Designing Your Annual Physical Therapy Practice Plan 

Like any business, the key to a thriving private practice requires a well-thought-out plan with measurable and achievable goals and an all-in mentality from every team member regardless of their role. 

For physical therapy clinics, your Practice Plan should include:

  • Your biggest long-term and annual goals 
  • Vital practice metrics (e.g. new patients, visits, revenue, attendance rate) this year and projection for the year ahead
  • Financial assessment from this year (revenue and costs) and plan for next year
  • Marketing assessment from this year (what worked and what didn’t) and plan for next year, including key metrics to track 
  • Personnel assessment from this year and plan for next year 

A private practice growth plan ensures predictable performance and consistent growth not only next year but over the long term.

Should You Increase Revenue or Cut Costs?

The threats of declining reimbursements, a competitive hiring market, and rising costs for space, personnel and equipment are reducing physical therapists’ already slim margins to dangerous levels. There are two main ways to combat these challenges:

  1. Increase top-line revenue
  2. Reduce costs

Most of your competition will approach this problem by seeking to lower costs. But you actually have less control over costs than over revenue, and cutting costs usuallys lowers revenue, particularly when it comes to marketing. There is much more upside and growth opportunity available to those practice owners who focus on increasing top-line revenue rather than decreasing costs. Therefore, the suggestions we make in this article focus on increasing top-line revenue.

7 Ways to Increase Physical Therapy Clinic Revenue

In this section, we’ll explore 7 ways to increase physical therapy clinic revenue without a significant increase in costs. 

1. Decide on Your BHAG (Big Hairy Audacious Goal)

Before you develop your practice growth plan for the year, look ahead and think about what you envision over the next 5, 10, 15 years, and beyond. If you had a magic wand and could make anything possible for your practice, would would it be? 

This is how you can determine your Big Hairy Audacious Goal (BHAG), an idea popularized by the book “Built to Last,” by Jim Collins and Jerry I. Porras.

Your BHAG is something that is long-term and achievable but at the same time, makes you feel a bit uneasy that you’re even considering it in the first place.

It should be inspirational, motivational, and something that is frequently shared with your team.

Here are some examples a BHAG for a physical therapy clinic: 

  • Become the number one physical therapy provider in your region
  • Help 20% more people in your community YOY
  • Open a new clinic every 3 years
  • Become the most popular physical therapy clinic to work at in your area

Note that your BHAG should not be a revenue goal. It’s important to have revenue goals, but your BHAG should be something motivational, inspational and compelling that makes your entire team proud to work at your clinic.

Your annual goals should be designed to support your your BHAG.

For example, if you have a BHAG that has to do with increasing your volume of patient visits, you’ll need to develop your annual goals to ensure that you have a plan in place for driving more visits, have enough space to accommodate more visits, and enough clinicians to serve additional patients. Depending on your  situation, you may decide to open additional locations or hire more staff. 

2. Break Down Goals By Quarter, Month, and Week

One of the biggest mistakes private practice owners often make is developing an annual plan and then shelving it for the year. Without a concerted effort however, you simply won’t be able to grow your practice. 

Therefore, you must be specific and set goals for each quarter, month, and week. This strategy allows you to understand what’s working and what needs to change so ultimately, you can meet your annual goals.

How to increase physical therapy clinic revenue: Create a practice plan that starts at your high-level values and ends with metrics and accountability.

3. Add Cash-Pay Services

Think about ways that you can provide more value to your patients and generate more revenue by adding additional services to physical therapy. Many physical therapy practices are supporting their revenue by adding cash-based services such as therapeutic lasers, massage therapy, or dry needling. Some practice owners are even adding gym or fitness facilities on to their practice and charging for membership or fitness classes such as pilates or yoga.

4. Be Transparent With Your Staff

Keeping the lines of communication open, and sharing metrics, high-level finances, goals, and achievements with your staff gives them ownership, builds morale, and helps to retain and attract staff. . 

For starters, your staff should have full transparency into your expenses, marketing budget, reserve, and profit. With this data, they’re able to get an accurate and complete financial picture of the business. Staff will want to know that the practice is stable. When finances are tight, it gives them a better understanding of why their salary is what it is. 

As long as your staff is behind the mission of your practice, your BHAG, and the culture of your practice, they are more likely to stay on for a lower salary than what they could potentially get elsehwere.  

During weekly meetings, start with wins and recognize staff members who have gone above and beyond to help your patients or solve a problem.

Then, each staff member should share their accomplishments for the week, such as the number of visits and attendance rate, as well as what they’ll work on the following week. 

This not only builds accountability, but it helps staff recognize that they’re working  as a team to achieve a financially stable environment, grow the practice, and ultimately, help more people and leave a bigger impact on the community.

5. Create Monthly Recurring Revenue

Earlier this year, we spoke with Jeff Langmaid on the Grow Your Practice Podcast about how to grow practice revenue. One of his main suggestions for diversifying your income is to create recurring revenue that meets your minimum viable monthly expenses each month. “If you can have recurring revenue that meets your expenses, working in your practice becomes a lot more fun and way less stressful,” Jeff said. 

He offered 3 models for creating monthly recurring revenue:

  • Provide ongoing services

    This can look like a monthly movement assessment, a monthly check-in, or any type of maintenance care that makes sense for you. After your patients complete their plan of care, have them check in with you once a month. A majority of time this is warranted and is not overtreating. A monthly check-in is a great way to increase patient visits and create monthly recurring revenue.

  • Open an e-commerce store

    Sell items that supplement your services. Supplements are a great example of what you can sell in an online store. We know that between 50 to 70% of people going to conservative care providers take supplements each and every day, whether its a multivitamin, Vitamin D, Omegas, etc. Other options could include exercise props, therapeutic heating/cooling devices, ergonomic products for sleep or work as examples. The key to creating auto-recurring revenue is to have an online store that drop-ships direct to your patient. This way, you don’t need to have the inventory and utilize space in your clinic. 

  • Offer online coaching or digital courses

    This could look like anything from telehealth all the way up to lifestyle coaching. For many providers this may feel like very new territory, but there’s an avenue there to create monthly revenue by providing value on an ongoing basis. This can be leveraged at scale online. You can create courses that can be sold online without requiring significant amounts of your time on an ongoing basis.

6. Explore Remote Therapeutic Monitoring 

Most updates in the 2023 Medicare ruling further squeeze revenue for PTs.

But there is one area that actually presents an opportunity to GROW revenue: Remote Therapeutic Monitoring (RTM).

Remote Therapeutic Monitoring is a way to contact, communicate, and monitor patients remotely outside of the clinic setting. RTM solutions may leverage certain medical devices, apps, or online tools to monitor and communicate with patients. RTM is often used for follow-up conducted remotely via phone call or two-way audio-visual communication. 

Many therapists are recognizing the opportunity to augment their services with Remote Therapeutic Monitoring to increase reimbursements.

7. Build Patient Demand to Create Consistent Patient Visits Year-Round

Private practice owners are often unsure about how to get started with marketing and which tools and platformsthey should invest in.

The best (and most affordable) place to start is with your patient list and email marketing. 

Email can help make your practice more valuable, and increase reactivations and build patient demand for your services.

Once your email marketing is in place, you’ll want to think about online advertising. However, it’s important to recognize that not all channels are created equal and what works for one practice may not work for another. 

Talk with your patients first and find out what types of media they’re consuming to figure out which channels would be the most effective. 

Breakthrough offers a complete, all-in-one patient demand platform that provides a simple, repeatable way to consistently grow your practice by attracting leads, converting leads into patients, and measuring success. 

Our team of marketing experts has years of experience working with hundreds of private physical therapy practices and delivering guaranteed revenue growth. 

Find out how to physical therapy clinic revenue and generate consistent visits year-round.

Request a free consultation today.

What to know about the No Surprises Act and Good Faith Estimates. How to prepare for medical audits.

No Surprises Act, Good Faith Estimates, And How to Prepare for Audits

In a recent podcast episode, Breakthrough Founder Chad Madden, MSPT speaks with Mary Daulong, PT, CHC, CHP, President at Business & Clinical Management Services, Inc. (BCMS). Chad and Mary discuss what you need to know about the “No Surprises Act” and Good Faith Estimates. Mary and her team have worked hard on providing resources to help PT practice owners comply and thrive in the new regulatory landscape. 

Who is Mary Daulong?

Chad: Mary is the Queen of Compliance. She has more than four decades of private physical therapy practice experience. And I want to compliment and thank you for keeping us legal, compliant, and ethical.

Today, we’re talking about the “No Surprises Act,” which became effective as of January 1st, 2022. It’s being discussed in all of the online group forums at essentially every physical therapy or healthcare provider website that I’m on. There’s a lot of confusion about this new legislation amongst owners. Can you give us a summary of what it is?

Part 1 of No Surprises Act: Disclose Out-of-Network Charges at In-Network Care Facilities

Mary: Well, the “No Surprises Act” was a surprise, right? When it was first contemplated, it really was to protect patients from having “surprise” bills. Say they went to an in-network hospital for surgery, but there was an assistant surgeon or maybe an anesthesiologist there who wasn’t in-network. And as a result —surprise — the patient gets billed at out-of-network rates. That’s what part one of the “No Surprises Act” addresses, and I’m in favor of that. But it has kind of ballooned from there.

Part 2 of No Surprises Act: Application to Private Physical Therapy Practices

Mary: The idea in itself is good, but the dispute resolution system really doesn’t lean towards the provider. So if the patient complains about the bill in this process then you have arbitration, where someone decides what the fair amount is that the patient should pay. And that doesn’t always turn out to be favorable for the provider, as you might guess. Also, we have a lot of PTs who are out-of-network because they accept cash, and we don’t have any clarification about whether this will implicate them, but it could.

On “Good Faith Estimates”

Mary: This is the part where we’re all pulling our hair out and saying, you gotta be kidding me. Recently, I got a text from one of my dear clients that said, “I’m just going to sell my practice. I provide the services, I do the billing, I do all the administrative tasks. I can’t add this to my things to do.” And we’re hearing this all over. People are very frustrated. 

So, what does it mean? Basically, therapists have to tell patients who are uninsured—as well as those who are insured but choose to self-pay—what our best estimate is for how much the service is going to cost. And because we have repeat services, that makes it very, very complicated.

How to Make this Information Public

Mary: One thing we do know absolutely for sure is that we have to post a notice with all the information about good-faith estimates, timelines, and dispute resolutions. And that’s the easiest thing we have to do. The notice needs to be posted in your clinic in a prominent area, where a patient would be likely to see it. It needs to be posted in areas where you collect for services rendered or do billing. And it needs to be posted on your website. (CMS provides a standard form for good-faith estimates here and details on what should be included in the notice here.)

Chad: What exactly does the notice need to say? 

Mary: The notice is for people who are uninsured or who were not using their insurance—with the exception of federal payers. It basically says that we’re required to tell them what the services for episodic care are expected to cost. I’d suggest basing it on a plan-of-care period, because you might change things at that point. And you can certainly charge them less than that. But you have to tell them that if the estimate is exceeded by $400, they have a right to dispute it. And you have to tell them how to dispute it, and who to contact. So it’s a simple notice; that’s the most clear thing. What becomes unclear is it doesn’t apply to patients who have benefits with federal payouts.

So as healthcare providers, we have to post this notice in all our clinics. It should be in the waiting rooms with licenses or certificates of occupancy or something like that, in prominent display. If you’re an owner and you don’t have it, you can contact BCMS for a template. Medicare also has a template on its website. So you can go to cms.gov and they have a “No Surprises Act” webpage and their own template as well. Number one on everybody’s checklist is we have to get that done.

How to Train Your Staff on the No Surprises Act

Chad: The next thing is that we really have to train our staff, especially reception. If somebody asks how much this is going to cost, we have to be able to tell them.  Regardless of whether they’re in-network or out-of-network. Is that true?

Mary: That’s right. First, we ask if they’d like to file insurance. If not, we’re required by federal law to give them a good faith estimate for the services that we would render for this condition.

Chad: At my practice, we’ve been doing cash pay. I’m guessing our rate is exactly $100. It might be $104. And we’ve always said, $100 per visit. Is that sufficient? Or do I need to say, you’re coming in for an ankle sprain, and that’s likely going to be six visits, so $600. Or: you’re coming in for a whiplash injury or something like that, and that’s going to be 16 visits, so that’s $1600.

Mary: Right. They created “required elements” for the good faith estimate form. So what you have to do is tell them how much it’s going to cost. If you’re flat-fee, or if you do fee-for-service, or whatever, you’re going to have to make sure your estimate gives you enough latitude to not go over by $400. On the form we have, it will give you some options. The thing is, you have to identify what you’re doing. This is the hidden consequence that we’re going to have to deal with. For years, we’ve tried to discourage third-party administrators and payers from saying they’re going to authorize X number of visits or X number of CPT codes. Are we supposed to always have a crystal ball to know exactly how we’re going to treat them? We don’t, so that’s problematic for sure.

Good Faith Estimates Should Mirror Your Plan of Care

Regardless of how you’ve set up your estimate, you’ll have to do some prognosticating about what you’re going to need from the patient. So the more inclusive you are, the better. But the important thing is that the good faith estimate really mirrors your plan of care. If they’re going different directions, that’s a problem. And if you decide the patient isn’t responding well, and you want to change things dramatically, then you have to go back. But if you’re under your estimate, that’s not a problem.

When you evaluate somebody, that’s when you determine how you’re going to treat them. So it necessitates two good faith estimates. There’s one for the evaluation, and then you have to create another one because you have to give it to them in advance of treatment. Now, is there a consequence for not giving it to them in advance? If the patient says, “I want to be treated right now,” then it shouldn’t be a problem. Also, we don’t know yet what the penalties are because they’re not anywhere to be found. We don’t know if it’s fines, penalties, or administrative sanctions. But it’s the law, so we have to comply.

Show Intention to Comply

Chad: In your SIPA summary, you mentioned the importance of the intention. As business owners, we need to show that we’re attempting to comply with the law. What do you mean by that?

Mary: Well, there are some providers who totally defy what’s logical. When HHS tells you what should be in the notice and you choose not to include it, that’s pretty purposeful. You have to tell the customers that there’s a dispute resolution if it goes over by $400, and that applying for this costs $25. Those things have to be in the notice, or else you’re not compliant.This is especially for all of those who have been audited or are thinking that they want to protect themselves.

Green Envelopes: What to Do When You Get an Audit

Chad: So let’s switch over to the Supplemental Medical Review Contractor (SMRC) audits. What is that?

Mary: The notice comes in a notorious neon green envelope. Typically, it comes in the middle of an episode of care. It’s not uncommon for auditors to request one day to service records, maybe 30 or 40 charts. We’ve been flooded with people asking what to do for their initial evaluation.

Chad: Got it. So I get one of these fluorescent green envelopes in the mail. What should I do?

Mary: First, pull up all the resources in the SMRC packet. It tells you exactly what to do. We have one that says how to respond to a payer’s request for records. It’s quite lengthy, but it has some graphics, so it’s not terrible reading. Do not throw the envelope away. Read the letter, then read the letter again. Look at who’s sending it to you. Go through the SMRC packet step-by-step. You want your submission to be organized, legible, and easy to follow.

At BCMS, we produced a template for a table of contents. We have a template cover letter and a form for identifying the billing personnel they asked for. We also have provided some clips from the Medicare benefit policy manual that says we don’t have to have long-term goals. If you need further support, you can email Alicia at [email protected].

Chad: Mary, Alicia, and the BCMS team have put together other training sessions for you that are highly recommended on billing and coding, and also on documentation. So if you’re looking for any of the resources that we’re talking about, you can email Alicia and she can set you up with that. And if you  contact Alicia, they’ll also get the FAQ for the SMRC audits, which is pretty extensive.

What’s Changes Can We Expect in the Future?

One final question for you here. And thank you for extensively reviewing the good faith estimate and also the SMRC audits, because I know a lot of owners are paying attention to those two things right now. Is there anything else in store for us as private practice owners in 2022 that you see coming down the pipe? Is there proposed legislation or anything like that on your radar right now?

Mary: Well, we all know the PTA payment differential is a killer, but I want to tell you, it’s not going away. Sorry if I’m the fun sponge on this, but our colleagues, the nurses, PAs, all of them have been dealing with this for years, if not decades. So it’s going to be very hard for us to say, “hey, this shouldn’t apply to us.” 

So let’s put our endeavors where we’re gonna get the least resistance. Let’s get rid of the plan of care certification. Let’s get general supervision across the board. Then we won’t have problems with somebody signing something that they’re not enrolled in. I’d encourage everyone to look at some of those important things. That’s my little soapbox.

Chad: I appreciate the look into the crystal ball, Mary, and into what’s coming down the pipe for us in the future as private practice owners. Another quick reminder: if you’re looking for any of the resources that Mary mentioned in this episode, you can email Alicia Mahoney, at [email protected]. You can also check out the BCMS website, BCMScomp.com. 

Well, Mary Daulong, Queen of Compliance, thank you very much for being here and helping us as private practice owners.

Looking for more resources to help you manage your practice? Visit Breakthrough’s Resources Hub for free content on marketing, hiring, financing, and more.

Practice Growth Plan

How to Make Next Year the Best Year Ever for Your Private Practice

In the winter months, as patient visits starting to wind down, now is a great time to get clear on what you want to achieve next year. 

We hosted a Webinar on this exact topic, so this video will walk you through the entire strategy and plan!

Why Create a Private Practice Growth Plan?

Because if there’s one activity I’ve seen that separates successful practices from struggling ones, it’s this: Setting measurable objectives and creating a practice growth plan that gets you there. An astounding number of practice owners don’t go through this process. And they’re usually the ones left wondering what went wrong. 

As healthcare practitioners, we face many challenges associated with a broken system. But with a bit of planning and strategy, you can take control of your own destiny and build a legacy that lasts. 

It’s always important to have a clear physical therapy business plan, but this year it feels even more urgent. With high inflation and a competitive hiring market, our costs are higher than ever. There’s not much we can do about it. That means we need to get very strategic about what we can control: The amount of revenue we bring in. Follow the practice growth planning process below to develop your strategy for increasing top-line revenue. 

How to Create an Annual Practice Plan

To do this process right, you should dedicate around two full workdays to building out your practice growth plan. If you have a leadership team, you can work through this process together.

I’ve created a tool to help guide you through annual planning: The Profit Planner Tool. Download the tool and get trained on how to best use the tool for your planning process. 

The Profit Planner is a physical therapy business plan template. It empowers practice owners to take control of their practice finances and achieve their business goals.

For any private practice, there are 3 pillars of successful practice growth. An effective way to begin is by assessing each of these key areas and determining what’s needed to achieve your goals in each one. 

3 Pillars of a Practice Growth Plan

1.Financial Plan

What are my projected revenues and costs? Do I need to make changes to increase top-line revenue? 

According to Greg Crabtree’s book, Simple Numbers, Straight Talk, Big Profits!, service-based businesses in the healthcare field typically have profit margins between 10 to 25%. The average margin in physical therapy is 14%. 

I prefer to aim for the high side of that range, and regularly see margins upwards of 20% in my practice. 

If your earnings are 10% or less, your business is at high risk. If this is you, then developing a strategy to improve profitability should be your #1 priority if you want to stay in business. 

To calculate your profit margins, subtract your costs from your earnings. Start by calculating these numbers for last year, then project out to this year. 

You can calculate total gross revenue by multiplying the number of treatment plans with treatment plan value. 

Expenses are derived from personnel, billing, marketing, space, office expenses (e.g. office supplies), and clinical expenses (e.g. medical devices). 

Once you’ve calculated last year’s earnings, it’s time to forecast this year’s profitability. Ask yourself questions like: 

  • How many treatment plans do I expect?
  • Has the value of a treatment plan changed?
  • How can I increase the value of each patient? 
  • Do I need to make any personnel changes?
  • What is my marketing strategy and what ROI can I expect? 
  • Are there any changes in financial expenditures? 

 2. Personnel and Hiring Plan

Do I need to make any personnel changes to grow profitability? 

If you have a full schedule, a waitlist, and space, then guess what — it might be time to bring on another clinician. Bringing on more clinicians enables you to serve more people in your community and increase profitability.

It’s a competitive hiring market, and there are a lot of changes in supply and demand in the workforce right now. This doesn’t mean you shouldn’t hire right now. You likely only need one or two new clinicians. Even in a competitive market, it’s very possible to find a great fit. 

Follow best hiring practices: In your job ads and interview process, be very descriptive about what you’re looking for in the role. Make sure it’s a good culture fit and paint a picture of growth at your practice. Learn more about hiring mistakes and best practices in this podcast episode: 10 Processes for Hiring, Incentivizing, and Motivating Your All-Star Team.

3. Private Practice Marketing Plan

What strategies and systems will I use to increase revenue? 

Your marketing strategy is your biggest lever for increasing top-line revenue. When evaluating what changes you want to make to your marketing strategy for the year, I recommend asking yourself the following questions: 

  • How will I attract more patients?
  • Can I increase per patient revenue? 
  • What’s my plan for reactivating past patients? 

As you answer these questions, consider: What goals do you want to achieve in each area? Which tools, systems and channels will you use? How much ROI can you expect from each strategy? 

To keep your practice profitable and growing, you should spend around 10% of your total revenue on marketing. For established practices, you can split your marketing budget between attracting new patients and reactivating past patients. Newer practices (under 2 years old) will want to allocate the majority of marketing budget towards cold traffic and spend a smaller amount on engaging past or existing patients. 

Ready to start planning for the year ahead? Start with the Free Profit Planner Template

The Profit Planner is a physical therapy business plan template. It empowers practice owners to take control of their practice finances and achieve their business goals.