How to Incorporate Cash-Based Services Into Your Physical Therapy Practice
This blog about ways to incorporate cash-based services was written by Brian Gallagher, PT, President & Founder of MEG Business Management
Everyone’s heard the saying “Never put all your eggs in one basket.” Well, that couldn’t be more relevant than it is right now. This phrase is especially relevant for those in the healthcare industry – and physical therapy practices in particular.
Most physical therapy practices already offer a variety of services, but can you do more? The answer is yes, even in uncertain times – like post-COVID recovery periods. When you incorporate cash-based services into your day-to-day offerings, you not only help your patients – you help yourself at the same time.
It’s time to flourish and prosper by shedding the suppression and snapping out of survival mode.
Read on to find out more about helpful – and significant – ways to take back control over your future in private practice.
Why Incorporating Cash-Based Services is Necessary
According to eHealth, the most recent data from the Kaiser Family Foundation (KFF) states that approximately 157 million Americans receive employer-sponsored health insurance, which makes up roughly 49% of the country’s total population. This is a huge number of patients, but it’s still not everyone.
It’s not just about appealing to people by offering services covered by insurance anymore. For the most part, people seek greater value for the money and time they spend on healthcare services.
A need for change is obvious when you consider the lower insurance reimbursements, higher regulations, more administrative duties, and a public that is more likely to take charge of their healthcare decisions and not blindly follow their doctors’ recommendations.
If you are still just the one-stop-shop practice exclusively offering physical therapy care to only those that fall under your insurance contracts, then you are at the mercy of those contracts and may be limiting yourself. Don’t do this.
In a value-based economy, people will pay out of pocket for a greater perceived value. Make sure you are capturing these patients and not leaving money on the table.
The idea of owning and running a business is based on the goal of succeeding. Think about it this way: great business leaders believe that you’ll never see anyone succeed in business with the mentality of scarcity. Those that come out on top always think and operate from the mindset of abundance. This sounds complicated, but when you really consider the message, it becomes clear.
It’s not about the “what if’s” but rather the “what abouts?”
How to Incorporate Cash-Based Services
The main way to operate a successful practice is to find new ways to generate income. Everyone understands that, but how can you make it happen?
Consider creating a new income vertical that can grow to be 20% of your total Gross Income (GI) each year.
Choose services that people need and want. Adding them puts you back into the driver’s seat with control. The more you can operate from a position of cause versus at the effect, the happier you’ll be. At the same time, you’ll be able to do more for others. Isn’t this the whole point of owning a practice?
Start by evaluating your physical therapy business model. This allows you to see if you’re still operating with the best practice model available to meet the needs of all your potential patients. Taking this simple step at the beginning of the process saves you time and effort later.
Then look for opportunities to add cash services to enhance your existing offerings, like dry needling or nutritional therapy. How could that work?
Here’s one recommendation: maximize your clinic’s earning potential with the In-Network Cash-Based Hybrid Model.
To understand why implementing it is a good idea, it’s important to look at the bigger picture – and then get down to the logistics.
What is the In-Network Cash-Based Hybrid Model?
The ultimate goal for your physical therapy practice is to be regarded as a premier therapy provider. This means operating with the sole purpose of achieving optimum health for every patient.
Why is this important?
If the public sees your business as “just another therapy provider,” then that is exactly what you’ll be. Those are a dime a dozen among the approximately 18,000 private practices in the US. Standing out from the masses is critical to success – and longevity.
So how do you stand out as a premier physical therapy practice?
The in-network cash-based hybrid model allows you to operate a cash-based vertical alongside the insurance-based system.
Sign up with all of the commercial insurance carriers that offer at least $10 of your operating costs per visit. Then, create a new cash-based vertical of services not covered by these carriers.
It’s important to note, Medicare is not included in this evaluation, only the commercial carriers.
This hybrid is a great model for private physical therapy practices because it allows you to capture patients looking for in-network services as well as cash-based services.
Implementing this cash-based hybrid model involves three phases:
- Restructure your company to best meet the needs of today’s public and your associates.
- Invest in the tools and technology to provide the services sought by patients. These services should have proven effectiveness and value to patients.
- Promote your services to the community.
Continue reading for more detail about each of the phases and how to implement into your physical therapy practice.
Restructuring Your Business to Meet the Needs of Your Patients and Staff
Phase One involves a restructuring of your environment and company structure to best meet the needs of today’s public. This is especially important today, as medical clinics and practice owners search for ways to bounce back after the pandemic-induced changes. Reengineer your environment in order to meet COVID safety standards.
The most difficult aspect to manage here is that these standards aren’t concrete. As public health directives change, you need to be able to adapt, too.
In addition, your administrative staff will update HR policies and procedures, keeping in mind the new clinical compliance standards that are in place for 2021. Staying up to date with these compliance standards, including new or updated laws is important to help your practice detect and prevent violations of rules. This helps you, your patients, and your practice.
To further sustain your practice operations, implement a 5 Division Organization Chart that lays out all posts, duties and responsibilities. These are metrics that can be measured objectively for full accountability from everyone involved.
You can no longer afford to have people working for you who are just exchanging time for money.
Work on completing the following steps during your phase one restructuring:
- Read the Physical Therapy Covid Playbook to get recommendations on reengineering
- Make sure to include an Aerus air purification/sanitization system in your office
- Set up the 5 divisions in your practice with a company organization chart
- Establish onboarding checklists for every position in your practice
- Establish staff accountability with the proper statistic tracking system
After completing these steps, you can move from planning to implementation.
Investing in Tools and Technology to Provide Valuable Services
Phase Two should include investing in services that are proven effective and sought after by patients.
In a value-based economy patients are willing to pay for quality services with proven outcomes.
The cash-based services you choose to offer must align with your passion and purpose for being in private practice. What does this mean? Don’t compromise on your Ideal Scene. In this phase you move from planning to overall implementation.
Here are the steps to take:
- Study how to launch a pilot program step-by-step (contact us at MEG for this tool)
- Always assign one team member over any cash-based service or project to prevent confusion or overlap
- Define desired targets with by establishing timeframes and goals to be achieved long-term. Be realistic with these targets
- Evaluate outcomes for meeting intended results and don’t justify for lack of performance – stay vigilant
As you implement changes, it’s important that cash-based services set your practice apart from the pack and provide value to your patients. Patients are willing to pay out of pocket for quality services, but they must experience value comparable to the cost. This is your opportunity to bring in highly trained clinicians and use direct access to differentiate your clinic.
And phase three is how you introduce these services to the marketplace.
Promoting Your Cash-Based Services
Whatever cash-based services you embrace should result in others living a higher degree of optimal health.
Don’t change something just because it’s pitched as a money maker. This is not the way to go. Outsiders often perceive this as a cash-grab. Your personal integrity will take a hit. Even though you’re trying to ensure prolonged success, you should never compromise your standing with your patients – or your peers.
Doing the right thing for the right reasons has a higher probability of success. This is because above all, people want to do business with those they know, like, and trust.
Here are a few cash-based options for you to consider in your practice model:
- Laser therapy
- Dry needling
- Nutritional therapy
- An aftercare health & fitness program with personal fitness training
- Neubie E-Stim system
Depending on the services and programs you already offer, integration into day-to-day physical therapy clinic operations is possible. Some may require purchasing new equipment, or hiring on new physical therapists or medical professionals. For many, these expenses are worth the investment, because the payoff in the long term is significant.
Remember, when providing cash-based services, patients want to be validated and vindicated in paying a premium for premium services. Make sure these services live up to the hype.
Find the Best Ways to Incorporate Cash-Based Services – And Then Join The Club!
Are you ready to be the zebra clinic in the pack of horses practicing in your community? Consider the compounding effect from patients who become long-term customers and then refer others in the future. Word of mouth is a valuable commodity – so give yourself an advantage!
Want advice and a hybrid cash-based model specific to your physical therapy practice? Connect with MEG Business.
Founded in 2006 by Brian Gallagher, MEG has assisted hundreds of physical therapy private practice owners in the startup, management and best practices to become a part of the top 10% of private practices nationwide.
Discover the physical therapy management services available and get connected with coaches that have helped hundreds of previous clients achieve success with these cash-based verticals. Get ready to quickly experience better patient outcomes, and greater practice viability.
Market differentiators like cash-based services often represent “better” care in the eyes of the consumer when it comes to innovative healthcare techniques. Why not set yourself apart from the rest?
Join the MEG community today!
Brian Gallagher is the president and owner of MEG Business Management (a PT business solutions company). He has more than 27 years of rehabilitation experience and nearly 20 years in business, Brian’s focus is on helping others. His specialty areas include physical therapy practice management, executive coaching, and restructuring practices to encourage efficient operation. On top of this, Brian also has extensive speaking experience with regard to marketing and public relations.