Tips to Grow Your Business After Proposed Medicare Cuts
This blog outlining the best ways to grow your business even with proposed cuts to Medicare was written by Brian Gallagher, PT – Founder & President of MEG Business Management
Protecting and Growing Your Business During – and After – a Pandemic
By now, you’re likely familiar with the proposed 9% Medicare cut. Even with hopes riding on the bipartisan bill that was introduced in the House of Representatives, which would drop the 9% payment reduction for calendar years 2021 and 2022, there is still much uncertainty.
This reduction threatens the future viability for many practice owners. It will ultimately impact all of our patients, too – even those who are not covered by the Medicare program directly. We also know that secondary carriers and most other commercial carriers typically follow Medicare as an example. Though the reduction may begin with Medicare, based on previous instances, practices need to prepare for other carries to make cuts as well.
This year has been difficult for everyone, practice owners and insurance groups included. It goes without saying that this year is not the year that many of us have the extra resources to absorb such reimbursement reductions. It seems harsh to be cutting reimbursement in light of 2020’s events. However, the plan for change is already in motion.
This is indeed unfortunate. But what if you tried a different approach to growing your business?
Find Ways to Grow Your Business as a Practice Owner
Let’s take a closer look at the silver linings to these projected changes.
If nothing else, these circumstances force you to get creative and perhaps a bit more aggressive.
Based on prior experience, for 90% of PT practices less than 35% of their total patient volume falls under the Medicare program. There are exceptions of course, but the important thing to note is this: this is not the bulk of your business.
While this may have a direct impact on 35% of your business, as well as some of the remaining carriers, it is imperative to remember that you have the power of choice. And this doesn’t just mean in just an abstract, idealistic sense.
So, what are some options to grow your business?
- You might choose to redirect your marketing efforts towards the non-Medicare demographic. Or you may choose to provide Medicare services that allow for more one-on-one care and result in greater fees for services.
- You can reinvent your brand to be more appealing. This is often done through newer innovative services with a greater diversification of care. The more automated and effective you can make your marketing and branding, the less resources you may need to spend on attracting new patients to your practice.
Finding ways to spend less money to attract more business helps to offset the lost revenue coming from prior Medicare treatments.
Statically speaking, the number of patients seeking PTs in private practice from 2013 to 2018 rose 40%. These numbers come directly from the 2018 CMS report. These are important figures to consider.
Don’t be shy.
Go loudly and proudly into your community to help those who need it. Your patients already look to you for quality care. Finding ways to innovate what you offer – and who you offer it to – helps you effectively grow your business over time.
Other potential solutions for business growth and maintenance during a pandemic include the following
There are three specific options for you to consider when it comes to your practice’s success. You do not have to implement them all at the same time, but when used effectively, they make a huge difference.
- Diversifying your income verticals
- Increasing your cash-based services (this goes with #1)
- Altering your compensation model
Three options to expand your income verticals and broaden your practice’s horizons
If you aren’t already doing so, you should consider working towards three income verticals (sources of income) for your business. By implementing different options for caring and compassionate physical therapy treatment, you entice your patients further.
Build upon what you already offer in terms of physical therapy and patient education. Use your current offerings and the skillsets of your employees to track into the future.
- Establish a PFT (Personal Fitness Training) after care program. Personal Fitness Training allows for maintenance and optimal health for all of your patients – public, Medicare and non-Medicare alike.
- Consider adding nutrition therapy services. Do this by contracting a Nutritional Therapist to help your patients — not just with dieting, but with grocery shopping and meal prep, too. One huge component of physical therapy is patient education. Teaching people how to exercise along with providing them the tools to eat healthy helps in the long run.
- Add Pediatrics, Aquatics, and SLP or OT services to your practice. Diversifying your offerings may take some getting used to, but the more services you offer, the more people you have the potential to connect with. Instead of outsourcing these physical therapy professionals and assistants, consider hiring them. More options for care means appealing to a wider potential client network.
Yes, you provide physical therapy services. But there’s more to physical therapy than simple recovery. Considering different income verticals is a tried and true method recommended by other business owners, so pay attention!
Diversify Your Business by Expanding Services and Implementing Cash-Based Options
Can Technology Help Grow Your Business?
One of the biggest successes in the outpatient world is the advent of the Neubie E-Stim.
This technology yields unbelievable results and is a unique draw for new patients. Of the practices that implement this device, 75% of them will get a second unit.
This modality can be used as a cash-based service, or will be covered under most insurance plans.
Other ways to implement technology include:
- Mobile apps
- Rehabilitation robots
- Virtual reality
Diversify your services, find ways to implement new technologies and see how your business’s future becomes a little less scary. Embrace technology to grow your business, and check one more item off of your list.
Altering Your Service Options Helps When Working to Grow Your Business
You might not want to think about it, but another solution to consider is being open on Saturdays. Though an unfavorable option for many practitioners and owners, the truth is that more patients have weekend availability. This additional availability means your clinic will likely get busier, which is the ultimate goal.
If you want to pay your bills and keep your patient numbers elevated, you may have to consider a 6-day work week. Yes, these are desperate times, but remember: health and nutrition don’t take weekends off.
Accommodating your patient needs requires some sacrifice and adaptability, but when you find a viable way to grow your business, it’s well worth it.
Rethinking Your Compensation Plan is a Great Way to Promote Business Growth
It may not be a main consideration, but now is the time to revisit your employee compensation plan.
Some people don’t like going to buffet restaurants because they have to pay a set price. This is a double edged sword, because in some cases, the value outweighs the cost. However, on some days, you won’t get your money’s worth from the meal. In short, these occasions result in money left on the table. If this happens every day with every meal, a ton of value is lost under this “pay all up front and hope for the best” style of eating.
This may seem like an unusual analogy, but the “buffet” scenario applies to your physical therapy practice, too.
In a way the “full salary with benefits” compensation model is a bit like that buffet. Unless your employee operates at 85% efficiency every day, while at the same time giving every patient the maximum volume of care that they deserve…someone gets the short end of the stick.
Think about the two main reasons why you chose to own a physical therapy private practice:
- To help as many people in your community as possible
- To provide each patient with an abundance of care during each visit
Patients know what they pay for. They see and feel the care they receive.
It’s apparent when they are paying a $40 copay to the therapist who delivers just two units of care during their session compared to the therapist that sticks in there and delivers four units of high quality care. Patients know this is happening, and as owners, it is your responsibility to educate and motivate your staff to provide the best, highest quality care to each and every patient.
In addition, therapists need to be valued – and recognized – based on their skills in efficiency, productivity and quality.
For this reason, developing a pay-for-performance model shouldn’t be taken lightly. MEG Business Management spent six months devising one that encompasses three primary factors and is easily managed.
Why do you need to encourage treating your PT professionals as staff therapists with an “entrepreneur” mindset as opposed to employees without equity?
Your patients should have the reassurance that their therapist has a vested interest in their experience. They need to be certain that it goes beyond just completing the session and write-up.
When implemented properly with the three key elements in place- efficiency, productivity, quality- the sky’s the limit for all involved. When patients, employees, and practice owners are all connected, everyone wins.
Everyone is looking forward to 2021. It’s no secret that putting 2020 in the rearview mirror is at the forefront of everyone’s minds. That’s fine. Now is the time to begin the process of moving forward with a positive attitude and looking for ways to make things better today than they were yesterday. Your practice depends on it, and so do your patients and their health.
Connect with Like-minded Practice Owners Today and Grow Your Business
The BetterPT clinic network is an ideal choice for practice owners because it connects you to others looking for similar solutions and opportunities. Not only does it provide access to a network of additional partners and tools, but it also gives you – and your patients – access to the BetterPT Clinic Location tool and app.
Physical therapy isn’t a one-size-fits-all solution to health issues and challenges, and owning a practice is not the same between businesses. However, having the ability to connect with others is a benefit. Can you afford to overlook it?
Join MEG on November 19 for the Zoomcast, “Is Your Practice at Risk for Compliance Violations and Gaps in Your Current Insurance Coverage?” Click here to register!
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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