At the end of 2016 I opened a cash based physical therapy practice, which is a different business model than people are used to seeing with physical therapy. Most physical therapy practices take insurance which, in my opinion, causes headache and restrictions on abilities to treat. When not having to deal with insurance, I can focus on quality of patient care and not quantity which is very attractive to my style of treatment. I can provide 60 minutes of one on one treatment focusing mainly on all hands on manual medicine using specialized techniques that take years to develop. I give exercises as a complement to my treatments to work on at home. Typically, clients only come 1x per week for 3-4 visits (except for those who like to come for maintenance) as opposed to 2-3x per week for 4-6 weeks.
Getting better with minimal number of visits should be a big consideration when deciding on physical therapy these days with sky high deductibles that can range from $3000-$5000 easily. With a high deductible plan, an hour visit at a typical insurance based physical therapy clinic can cost anywhere from $150-300 depending on how much is charged for each 15 minutes (charges are usually based on every 15 minutes). With a high deductible insurance plan, the patient must pay all the costs of the visits out of pocket until the deductible is met. This can add up to a fortune.
At a typical physical therapy clinic, visits are usually scheduled every 15-30 minutes, with the goal of keeping patients for 45-60 minutes, therefore a lot of overlap occurs. A clinician cannot be with 2 people at once doing hands on treatment with the overlap, so this means there is a lot of time doing repetitive exercises and using machines without too much guidance that could be done at home.
Let’s look at the cost effectiveness of my cash based clinic versus insurance based clinic:
| Cash PT | Insurance PT | ||
| Cost per visit | $75 | Copay | $30-60* |
| Number of visits | 4 | Number of visits | 12 |
| Total costs | $300 | Total costs | $360-720 |
| Time with PT | 240 minutes | Time with PT(15 min for a 30 min visit) | 180 minutes |
| Cost per minute | $1.25 | Cost per minute | $2-4 |
*Copay is not usually the only cost per visit. Often, with high deductible plans, $60 is the copay collected up front with the rest being billed later, which can significantly add to the total bill. Or, a copay has to be paid, plus being responsible for 20% of the total bill with a typical 80/20 insurance plan.
As you can see, coming to my cash based clinic is much more cost effective if you break down the actual cost per minute of seeing a PT. The table does not include all the variables that effect the total costs but it gives a general idea of the breakdown. Such as if someone has a high deductible insurance plan, they may get stuck with the cost of the entire bill, which can be thousands of dollars. Also, perceived value is very important because many of my clients appreciate that they only see me, as opposed to many other clinicians. This means they are only explaining their symptoms one time as opposed to every time they see someone new. Also, my visits are a full hour of hands on treatment and not just doing exercises or using machines that could be done at home or a gym. This means a much higher quality of care which leads to getting better much quicker.
Owning a non-insurance based physical therapy practice, my priority is to give the best care possible and provide the highest quality of treatment I know how. This makes practicing physical therapy very rewarding again and should for years to come as my practice grows.