Practice Management Archives

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.

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?

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:

Increase top-line revenue
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.

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.

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

The holidays are approaching and we’re all looking forward to a much needed break and time with family. But before closing out the year, I highly encourage you to spend time building your 2022 private practice growth plan. With patient visits starting to wind down, now is a great time to get clear on what you want to achieve next year.

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

Why Create a 2022 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 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 Ultimate 2022 Planning Tool. Download the tool and sign up for the 2022 Planning Webinar, where I’ll walk you through how to best use the tool for your planning process.

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 2021, then project out to 2022.

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 2021 earnings, it’s time to forecast 2022 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 the upcoming 2022 planning webinar.

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 2022, 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 2022? Let’s chat about partnering and automating your patient demand: head over for a free consultation

When talking to potential patients, most Physical Therapy practice owners focus only on their programs and products. They spend all their time talking about the PT services themselves, but by doing so, they’re neglecting a huge piece of their marketing strategy: the takeaway.

In other words, what is the audience going to take away or remember about your message? What knowledge will they gain? If there’s nothing adding something worthy to their lives, they’re not going to act on your message, and they’re likely not going to remember it.

You don’t want to get hung up on the details or start talking in professional terminology that only someone in the industry would understand, but this is the reality for a lot of PT practices when they’re trying to market themselves. It’s hard for them to step outside of the office and look inward from a patient’s perspective to develop messaging that speaks to the patient’s understanding of their own needs.

How can you shift from Physical Therapy Medical talk to delivering tangible, honest value to prospective patients? It starts with creating your unique value proposition and learning how to translate it into every component of your marketing strategy. Let’s dive in.

What is Patient Centric Marketing? What does it mean to be truly Patient focused?

Patient centric marketing flips the script and prioritizes value to the patient. Instead of talking about you, it pulls the patient into what you can do for them. You’re not just sharing content or creating workshops that will help the patient; you’re also trying to put the benefits into a perspective that the patient can understand, digest, and decide if it’s right for them.

Patient Centric gives a nod to fully immersing the patient in the experience, from their first click to the website experience to the way you navigate them through the funnel. It ensures that the view of your brand will be all about healing and helping the Patient recover.

Physical Therapy Medical Talk vs Patient Care

Promoting a Service vs. Promoting Value

Before we get into specifics, let’s visualize a quick example:

If you’re shopping for a car, and the salesperson is telling you the car has a powder coat paint finish, you might politely nod in agreement. But when they tell you that the powder coating is more resistant to chipping, scratches, and wear and will keep your car looking like new for longer, then you might start tuning in.

It’s a similar story with physical therapy marketing. PT practice owners tend to focus too much on the service side of the business rather than the education.

And it’s through education that your audience will start to connect their own dots, draw their own conclusions, and decide to take action without you having “sold” them anything.

Physical Therapy clinic owners often invest in self-serving marketing. They try to promote a program, a Physical Therapy workshop, or a new product, and even though these things will benefit the patient, the messaging is ultimately focused on the practice.

To do this well, PTs need to first identify their value to the patients. You can help them eliminate pain, avoid expensive surgery, live a better quality of life, heal from an injury—there’s a lot of value in working with a Physical Therapist over another type of healthcare professional.

But first and foremost, you need to translate this value in a way that patients can relate to.

Finding Your PT Practice's Value Proposition

Finding Your PT Practice’s Unique Value Proposition

By definition, a unique value proposition (UVP) is a clear statement on the benefits of what you offer, how you solve your patients’ needs, and what makes you different from the competitors. These are what make your PT Practice truly patient centric.

In physical therapy, every practice should have two value propositions:

The first is what sets them apart from other healthcare options, such as surgery, a general practitioner, or a chiropractor. In a recent webinar, I asked our attendees (who were all physical therapists) where they thought people would go if they had back pain. Around 90% of them said a chiropractor, and that’s a big indication that we haven’t done a great job in building the value of what we do to become a go-to choice for the conditions we treat.

The second value proposition that PT practices should create is what sets them apart from other PT practices in the area. People have options, and the few that do choose PT as their treatment of choice will need to know why they should select you versus a POPTs or HOPTs practice, or even another private practice nearby.

Take time to flesh out ideas that not only make you unique but also valuable in the eyes of your patients and prospects. These ideas aren’t necessarily something you’ll show to the public, but you can use them when developing your marketing messages and test your content against them.

If you find that your Physical Therapy marketing isn’t reflective of your value propositions, then you’ll know you need to do some tweaking.

4 Ways to Promote Your Value in Your Direct Access Marketing

We’ve given value a face and a name, so now, let’s explore some ways you can make your value tangible for your patients. Remember, the typical audience isn’t going to understand PT terms and procedures the same way you do. It’s not their background, so they need an easy way to put your benefits and value into perspective from the outside looking in.

Here are four common Patient Centric PT marketing tools that are ideal for highlighting value:

Physical Therapy Workshops

Seminars, webinars, and workshops are too often synonymous with sales pitches, and that shouldn’t be the case in physical therapy.

Your overall goal, of course, is to get more people to learn about your practice and the services you provide. But ultimately, the seminar itself is about the patient. You’re sharing information about a problem they’re experiencing, tackling potential causes of that problem, helping them understand ways to prevent the problem from recurring, and most importantly—proposing a clear solution that will solve their problem.

Your seminar should be designed so that no matter how many people sign up for a program of care or call for more information, every person will be able to walk out of your doors with something helpful, insightful, or important and not feel like they’ve wasted their time listening to a sales pitch.

Content Marketing

Content marketing is the collective term for blog posts, social media posts, videos, e-books, and all the other content you create and publish to promote your practice. This is by far the easiest and most effective way to promote your value because your content doesn’t have to say anything about your practice or services.

The main goal of content marketing is to position you as the subject authority in your area. People who read your content will learn from what you’re sharing, and they’ll know who to turn to if they ever have a problem you can help them solve.

Added benefits include increasing brand recognition, improving relationships with your patients and community, building trust, and giving you something to use to start conversations with your prospects.

Good content isn’t overly salesy in nature but rather focuses primarily on the educational aspect of marketing. Let people draw their own conclusions from it, or include a call-to-action that encourages them to reach out for more information.

Online Reviews and Testimonials

Online reviews are powerful in patient centric marketing. Studies show that 84% of people trust online reviews as much as a referral from a friend or family member, while 82% of consumers read reviews before making a purchasing decision.

The interesting part here is that your patients are the ones who are delivering your value proposition; not you. They’re sharing their own experiences with your practice, how you helped them, why they chose you, and why they’ll do business with you again.

Patient Retention Marketing

Retaining Physical Therapy patients is only possible when you’ve done a thorough job of promoting value throughout their experience. When you start a patient retention or reactivation marketing strategy, you should continue sharing valuable content and education that will remind them of how much you helped them in the past.

Similar to the influence of online reviews, patients who continue to seek your services after completing a program are living proof of your value. They achieved great results, they’re living a higher quality of life, and they won’t hesitate to visit you if they get injured again or experience a new problem.

In Closing

The biggest takeaway in pivoting is that you not only need to show your prospects how you’re different but also why that difference is important. They’ve been sold enough by doctors and other providers, and this is your chance to step up and show them there’s a better way.

For more direct marketing access insights and patient centric marketing strategies, head over to our Physical Therapy Marketing & Business Resource Center to check out our newest online training.

From 1929 to 1939, the world endured a severe economic downturn that would later be referred to as the “Great Depression.”

This economic turmoil resulted in a difficult period for most companies…but not all of them.

Some brands where able to make great strides during this time. These successful companies were different sizes and came from different industries. What they had in common was the fact that they kept investing in growth while others cut back.

Right now, the entire world is dealing with the effects of the coronavirus pandemic. So we are sharing 3 tips for private practice owners looking for ways to grow their practice during hard times.

Trim the Fat

Now is the time to be brutally honest about the necessities in your business…

And to cut anything that is unnecessary.

This sounds simple, but it’s a task that many business owners struggle with. Particularly when it comes to making hard decisions about personnel. Or past investments that have yet to produce a return.

Now is the time to take a deep dive into your numbers to find areas to cut back.

Marketing expenses are often the first thing put on the chopping block when it comes to trimming the fat. But eliminating marketing will also impact your revenue and may slow your recovery. Keep the big picture in mind before making the call to stop or cut back on marketing.

Realize that Everything is Cheaper Now

Be fearful when others are greedy. Be greedy when others are fearful.
Warren Buffet

Over the past few months, the hiring market for PTs has completely flipped. In the past, some owners struggled for months to fill PT job vacancies. Many private practice owners expressed how hard it was to compete with HOPTs and POPTs practices when it came to hiring new grads.

Now, that situation has flipped. And the same is true for the real estate market. Now is a great time to hire new PTs and/or renegotiate the terms on recurring expenses like rent.

Plan Ahead Now

No one can predict exactly what will happen in the economy. But, it’s a given that there will continue to be cycles of growth punctuated by periods of decline.

In the last two decades, the U.S. experienced recessions in 2001, 2007, and right now in 2020. And there will likely be another recession approximately 10 years from now.

Again, the exact time and circumstances are unknown, but that doesn’t mean you can’t plan ahead.

One exercise is to develop a “Grey to Black” plan for your practice. This Grey to Black plan is a financial forecast that looks at what would happen if you lost 25%…50%…or even 100% of your revenue.

How much time could your practice remain open? What steps would you take to minimize the damage?

Taking the time to plan ahead now will help you make better decisions during an actual crisis. Don’t let yourself be caught off-guard a second time.

Right now, times are tough for businesses. But growing your practice is still possible.

PTs provide a vital service helping people in pain. It’s important that PT owners do what they can to ensure their practice survives hard economic times so you can continue to provide this service to your community.

We’ll be going more in-depth on the topic of Growing Your Practice During Hard Times during the upcoming Breakthrough Virtual Summit.

Tickets for the Summit are free, and the event will take place 100% online. Click here to reserve your spot.

Improve your management style, get your team aligned on goals, and create more time freedom when you start using scorecards as part of your hiring process.

Click here to grab a free copy of the scorecard used in this training.

A scorecard is a personnel tool that you’re going to use in all of your personnel decisions. Hiring, incentivizing staff, firing, promotions, et cetera.

Everything revolves around the use of this tool.

Growing your practice beyond a certain point requires having the right team members on your staff. Autonomous, solution-oriented employees who get stuff done without hand-holding and micromanaging.

Problem solvers who are fun to work with and who help your business hit new milestones and revenue goals.

The ability to effectively hire is a skill most Practice Owners overlook. But its a skill that differentiates owners who are constantly stressed-out, overwhelmed, and time-starved…

From owners with an enviable level of time-freedom and the ability to take time off from their practice WITHOUT everything falling apart.

The training above contains my “Scorecard” Method for hiring and managing PT staff.

If you want to attract, train, and motivate rockstar private practice employees…

Who take problems off your plate and make life easier for you…

Then be sure to check this out.

And also download a free scorecard template to use at your practice.

In the past, we’ve discussed the state of PT and our aspirations to Flip the Pyramid and make conservative care the first choice for people in pain – ahead of injections, medications, and surgery.

But the current state of PT looks a lot different than it did just a few months ago due to the COVID-19 pandemic and the chaos and uncertainty it’s created in the world.

The truth is that similar events and challenges have occurred throughout history. Case in point: just 12 years ago, the financial crisis of 2008 hit and shook PT practices everywhere. At Madden PT, we were already battling encroachment from HOPTs and POPTs practices and ended up losing $98,000 in a single quarter. Back then, we were focused on physician referrals, but that crisis made us realize the need to diversify our income and create systems that would put us in a much better position during a future crisis.

Understanding these events can help us to better shift our thoughts and behaviors that will allow us to thrive now and in the future.

Exploring the Transition Curve

In the past, PT owners have typically followed a transition curve, where we start our PT practice with uninformed optimism that turns into informed pessimism when something goes wrong or business doesn’t come as easily or quickly as we’d hoped. Soon after, a crisis of meaning follows, where we explore what we really need and want from our practice. This leads to either crashing and burning or informed optimism, in which we are more aware of what it’s going to take to be successful and have new hope for the future of the practice.

But today, the transition curve looks much different. We’re now on a cycle of market emotions.

But now, just within the last week, we’re starting to see the bounceback. Patients are trickling in once again. They’re wearing masks and acting with caution, but we’re finally starting to see some hope for normalcy.

Learning How to Pivot (and Pivot Quickly!)

Just two months ago, our goals at Breakthrough looked drastically different than they do now. As a rule, our goals have always been to help private practice PT owners become successful while helping our own patients get back to normal naturally and make PT the first option they think of when they’re in pain.

We haven’t lost sight of those goals, but we immediately shifted our focus so that we could help other owners and the PT industry at large survive this crisis. We’re doing this by focusing our content and training on things to do during the pandemic, such as where to turn for financial relief and how to stay connected to your team and patients (even if you’re not treating them at the moment).

Just like we have four seasons in a year, we also have four “seasons” of the economic cycle in a given year. And it’s important to understand these seasons so that you can be in the best financial position when the market starts going up again. There will be an “end” to this pandemic, and when that end finally comes, PT owners should be prepared for the rebound.

The State of PT and the One Goal to Set Moving Forward

Bob Kowalick from Revenue Cycle Solutions shared some interesting stats with us recently on the financial state of private practice. His research found that about a third of practice owners are not in a financial position to survive this crisis. They’re in the same boat with about 43% of small business owners throughout the country that are saying they’ll likely not be able to reopen their doors when the pandemic is over.

For PT owners, avoiding this situation might mean not taking a salary for a little while. You still need a staff, a facility, and a way to pay for these things, so you might have to make the ultimate sacrifice.

Kowalick also found that almost half of owners only have a partial financial bridge. Of those, the majority are about 5% off their goal. If they need $50,000 in total to make it through, they are likely just $2,500 short of their goal. Some may be able to cut enough corners to come up with what they need, but if you can’t, your goal should be to do what you need to do to get into this next group of owners—the 19%.

Roughly one in five owners have a clear financial runway to the end of this crisis. Those 19% are at a major advantage because they’re going to be able to advertise and gain market share when the majority of their competitors cannot. They’re going to be in a better position to rebuild and hire the best staff and continue to grow their practice, both now and when the pandemic is over.

For the remaining 81% of owners, it should be the goal to become among the 19% that can weather tough storms like COVID-19 and be in a better position to continue growing.

For us to do this during the financial crisis of 2008 and the following months, we shifted our focus to three things:

Marketing direct to the consumer to become less dependent on physician referrals
Learning how to influence your payer mix and build a financial bridge
Building a better culture through personnel

When the pandemic conditions started rising earlier this year, these are the same three things we focused on. That’s because physician referrals have been in a tailspin, along with declining reimbursements. And since many people aren’t hiring right now, we’re using this opportunity to attract top talent to the practice to create an optimal patient experience.

PT practice owners can put these same ideas into motion to become one of the 19% (and ideally turn that 19% into 100% by the next time crisis strikes). To start, you need to know where you are right now, then understand where you need to go.

We have tons of resources available at Breakthrough University that can help you take the necessary steps to connect your present situation to your ideal destination― learn more about Breakthrough University today.

On a recent Breakthrough webcast, we talked about flipping the pyramid in the healthcare industry to capture more of the spend on health services.

Right now, about 72% of what’s spent on healthcare each year goes to surgery, injections, medications, and diagnostic imaging. Just 2% goes to physical therapy, occupational therapy, and speech combined. We want to be the number one skilled healthcare expert of choice, and to do this, we must become the foundation of skeletal and neurological health.

The recent pandemic has thrown a monkey wrench into this mission. Many practices are seeing declining appointments and revenues, which means you may not be helping as many people as you can. But if we’re going to push the PT industry forward and continue our greater objective to help people get back to normal naturally, we must survive the current crisis.

Let’s look at how you can do this on three different levels and be better prepared to help others:

Step #1: Managing Yourself

There’s a reason why airline companies tell you to put your own oxygen mask on first in the event of an emergency. You can’t help others if you’re not in a position to first take care of yourself.

The times we’re living in are unprecedented. Many of us are experiencing extreme levels of stress and added worry about the future. It’s changed our entire way of living, even if it’s only temporary. If you’re not taking care of yourself first, it can put you in a dangerous position if you try to reach out and help others.

Right now, there’s a common fear of what this increased isolation will do to us as a society in the long term. Some people may not be mentally handling these changes well. The best thing that each of us can do is take care of ourselves so that we can continue to reach out and be valuable to others:

Sleep

Matthew Walker’s Why We Sleep is an excellent resource that talks about how sleep is a daily detox of the brain and the way it affects the rest of your health. Ideally, you can use this extra time away from work to catch up on sleep and build healthier sleep habits.

Eat Well

Prioritizing the right foods can help us take care of ourselves for the short and long term. Some resources to check out are The Switch, Boundless, and Peter Attia’s podcast.

Exercise

Exercise and nutrition go hand in hand for a healthy lifestyle. Take this time to build more exercise and movement into your day, even if it’s “just” walking. At the very least, it can help combat the effects of stress eating.

Meditate

Finding clarity and making mental space in your day can help promote positive feelings and crowd out any stress caused by the coronavirus.

Socially Distance But Stay Connected

Socially distancing yourself doesn’t mean you have to cut all forms of communication. Stay connected with your employees, family, and even your patients via text, Zoom, phone calls, or social media to maintain the human element.

Step #2: Managing Your Family

We’ve talked about this before at Breakthrough, but if you’re not taking care of your family, you won’t be able to handle the highest responsibilities of being a practice owner.

Staying on a schedule can help everyone in your home maintain a sense of normalcy. Also, showing your spouse, children, and even parents your love and gratitude can make a difference in the dynamics within your home. Gary Chapman’s The Five Love Languages is a powerful resource for helping identify ways in which we give and receive love that is well understood by others.

Step #3: Managing Your Business

When you and your family have put on your oxygen masks, you’ll be in a much better position to help your practice, employees, and patients. We talk a lot about the three pillars of a successful practice: Finance, Marketing, and Personnel. These pillars are just as important during the pandemic as ever, but the way in which you approach them may need to be adjusted.

Finance

You’ll want to focus on financial planning. How are you going to bridge gaps and survive until things get back to “normal?” Before the crisis, one of our top concerns was figuring out finances with declining reimbursements. Today, a new challenge we have to factor in is what our income will look like based on grants, loans, and accounts receivables, as well as any new expenses you may have incurred due to loans, personnel changes, and potential vendor negotiations. One thing worth mentioning is that you may be able to negotiate some relief on your lease. Right now, not a lot of people are renting commercial property, and the last thing a landlord wants is to lose a tenant because they can’t afford rent due to closure.

Marketing

Before the crisis, one of the biggest marketing concerns was declining physician referrals. Many PTs are diversifying by going direct to the consumer and trying to influence their payer mix.

Staying in touch with patients will be key. Some practices may even consider offering telehealth options to give patients another option. The virus hasn’t taken pain away. If anything, it’s probably caused a lot of patients who were undergoing treatment to regress. Continue to provide value to your patients to stay connected.

Personnel

You should think through your current salary cap and how you can continue to employ your people and still be able to afford them. The PPP and the Cares Act offer some valuable help here, which we covered in an earlier blog post.

If you’ve had to lay off or furlough employees, you’ll want to consider how a reduced workforce will affect your ability to serve patients once you reopen. The good news is that not many people are hiring right now, so it should be relatively easy to build a pipeline of PTs and related personnel. Be transparent about your projections to rebuild and grow after the pandemic.

We have a hiring course in Breakthrough University and other resources that support the three pillars of a successful PT practice. Visit LearnWithBreakthrough.com to learn more about Breakthrough University.

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