Learn the Physical Therapy Practice Growth Formula

The Physical Therapy Practice Growth Formula: Marketing, Personnel, Finance

Several factors can affect the value of a physical therapy practice, including the size of the operation, consistent growth, and opportunities for expansion. Buyers are interested in practices with consistent growth records, high margins, and potential for further growth.

To increase practice earnings and value, owners should focus on three key areas: marketing, personnel, and revenue cycle management. Effective marketing strategies, such as email and text campaigns, online advertising, and a professional website with positive reviews, can drive patient acquisition and retention.

Factors Affecting Practice Value

While numerous factors will affect the value of your practice, we’ve identified three primary focus areas:

1. The Size of Your Operation

While the actual size of your operation in terms of practitioners and monthly visits is important, your earnings and margin are critical. A bigger practice doesn’t always equal greater revenue. 

Consider two businesses with the same number of possible monthly visits. One has a 20% margin, the other a 10% margin. Both have a high number of visits. But if you’re the business with a lower margin, the buyer is going to overlook your practice as the profitable option.

2. Consistent Growth

Buyers want to invest in a business with consistent growth records. Again, if you haven’t continued on a steady growth journey post-pandemic, now may not be the best time to sell (if you want to maximize value).

3. Opportunities to Expand

Buyers want to know that their investment has further growth potential. In the current state of your business, consider whether:

  • You easily draw clinicians/new hires.
  • There’s scope for improved space utilization.
  • There’s scope for clinic expansion in a new location.
  • You have a demand for services that you’re not currently meeting but have the potential to meet.

The Growth Formula: Marketing, Personnel, Finance

There are hundreds of tactics you can employ to increase your practice earnings. But in general, all effective, lasting business growth comes down to three key principles: marketing, personnel, and revenue cycle management. By focusing on these key areas, you’ll be well on your way to transforming your practice value in just a few months.

1. Investing in Marketing

As private PT practice owners start to feel the pinch of operational cost increases and reimbursement cuts, their initial response is often to cut expenses such as their marketing budget. But effective marketing is key to getting (higher paying) feet in the door. Reducing your efforts is counterintuitive to driving revenue and growth. 

Simply put, marketing drives patients, patients drive visits, and more visits increase revenue. Physical therapy marketing is also critical to generating consistent year-round patient demand.

Direct access marketing

 lets you take control of your growth. If most of your clients come from referrals, you’re missing out on potential business. At Breakthrough, we equip PT practices with marketing strategies and tools that are effective in the physical therapy industry specifically. We’ve found that the most successful marketing strategies for PT practitioners are:

Email and Text

Use these tools to reactivate your past patients—one of your most valuable assets. Email and text are low-cost but effective ways to nurture clients and draw them in with special offers. 

  • Maintain a patient contact list and communicate with weekly, bi-weekly, or monthly email newsletters. 
  • Provide value by focusing your newsletter content on the readers’ needs. 
  • Combine promotions and educational material and offer solutions to their problems.

Newsletter management doesn’t have to be labor intensive. Breakthrough offers an email marketing platform with PT-specific email templates that are proven to work. This means you don’t have to build emails from scratch. With integrated performance analytics, you can also gauge what drives results.

Online Advertising

Social media and online marketing are imperative to attract patients to your clinic. Strategically placed social media ads boost both brand recognition and brand value.

However managing multiple social media channels can consume a lot of time. Breakthrough’s automated ads cut the hassle with direct response marketing and messaging tailored to your patients. Our platform offers thousands of campaigns already optimized and 100% HIPAA-compliant.

Reviews and Website

Past patient reviews and a professional website both play a significant role in converting patients. Reviews act as social proof, demonstrating your expertise and the quality of your care. Similarly, a professional, well-designed website creates a positive impression and instills confidence in potential patients. 

Your website should showcase your services and expertise and serve as an informative and educational hub for people to refer to. Not only does this help to build trust and convert, but it also establishes you as a leader in your field of expertise.

2. Personnel

When you invest in your employees, you’re investing in the growth and development of your business. By giving them the necessary resources, training, and opportunities, you empower them to perform at their best and contribute to the overall success of the business.

When you invest in training programs, your practitioners stay up to date with the latest advancements. This improves their ability to assess, diagnose, and treat numerous conditions effectively. It also ensures they have the necessary knowledge and expertise to provide superior-quality care to patients, leading to increased patient satisfaction and retention. Continued professional development fosters job satisfaction and enables your practitioners to advance their careers.

What’s more, investing in your team builds a positive work culture, boosts employee morale, and increases engagement. When your staff feel valued and supported, they generally display increased motivation and loyalty. This boosts retention rates and reduces recruitment and training costs in the long run.

Training and development are just as essential for your administrative staff. Continued skills development for front- and back-end administrators will ensure efficient revenue cycle management and claims processing, which improves the patient experience.

When employees can learn and grow, they’re more likely to think outside the box and come up with innovative ideas and solutions. This can give your practice a competitive edge in the market.

3. Managing Finances for Growth

Allocating money toward business growth is key to expanding and improving your practice. Start by defining your growth goals and identify the areas you want to focus on. This can include hiring more practitioners, increasing your client base, investing in new equipment, or opening a new location.

Evaluate your growth opportunities and prioritize them according to their potential return on investment (ROI). You should also be proactive in financial planning.

Effective revenue cycle management is the backbone of building a financially successful practice. Make sure you’re incorporating the following practices as a base for business operations:

  • A comprehensive bookkeeping system
  • Accurate expense tracking and monitoring
  • Up-to-date financial records
  • Realistic fee structures
  • A plan for taxes and financial obligations
  • A streamlined insurance billing system

Growth Starts Here

Whether you’re hoping to sell your practice in two, five, or 10 years, the steps you take today can impact your business value. From improving revenue cycle management to marketing more strategically, there are highly effective ways to boost your earnings regardless of the financial position you’re in.

Get a team of PT practice growth specialists on your side with Breakthrough. Schedule a Practice Growth Strategy Call to see how the $20M Marketing System can work for your unique practice. Practice Growth Strategy Call - Blog - CTA

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