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When the keynote speaker, Gary Vaynerchuk, at the 2015 APTA Private Practice Section Conference asked an audience of like a thousand PT practice owners if they were happy about the financial health of their business, less than 50 people raised their hands.
Gary V. was obviously taken back by this lackluster response, so he repeated the question to make sure everyone was paying attention. Yet again, those same hands went up.
While this marketing genius, public speaker and venture capitalist was totally shocked to learn that most physical therapy practices are struggling just to survive, it really didn’t come to any surprise to me. Over the past decade, I’ve watched our profession get knocked around by insurance companies. Physical therapists have to beg and plead for every reimbursement dollar. Furthermore, there are countless "factory style" corporate chains monopolizing our space. In fact, I've even seen some private practice owners dusting off their resumes and going to work for the companies that essentially put them out of business. Others are totally stepping away from the profession.
SURVIVAL OF THE FITTEST
They are simply playing a losing game dictated by insurance companies (that clearly undervalue our work) on a field dominated by much bigger, stronger and faster players.
In New Jersey, we’ve been contending with these field conditions since the turn of the century. Insurance reimbursements have dwindled away. The only thriving practices are part of hospital systems that have negotiated higher contracted insurance reimbursement rates, or corporate PT chains that treat people in ultra high volume.
Some of our colleagues have attempted to level the playing field by pleading with insurance companies for more. After all, not all physical therapy is the same. Shouldn’t insurance reimburse more to a physical therapist who spends quality time with each patient, as compared to a physical therapy “ringmaster” who juggles 3-4 patients at the same time?
Unfortunately the answer is no. The current reimbursement model rewards those who are most productive in terms of billable procedure codes, not in terms of clinical outcomes.
Simply put, the best jugglers win.
PLAYING A NEW GAME
Many physical therapists are searching for a more sustainable game to play. They no longer want to rely on insurance or to fight for the same customers that the “big boys” can so easily swallow up.
By going cash, they are able to focus on each person individually. Their target consumer is someone who appreciates quality of care over quantity. Someone who knows the difference between being treated like a person versus like cattle.
On this new playing field, you can earn extra points (i.e., more money) by separating yourself with a niche area of study, like pelvic health. You can also gain home field advantage (i.e., more referrals) by passing the ball around to other like-minded players, such as an OBGYN, acupuncturist, fitness trainer, or nutritionist. By achieving the best clinical outcomes possible, you can score the ultimate game winning goal!
Check out my next blog post explaining why out-of-network PT can't be served like a $1 cup of coffee.
Disclaimer: The views expressed in this article are based on the opinion of the author, unless otherwise noted, and should not be taken as personal medical advice. The information provided is intended to help readers make their own informed health and wellness decisions.
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