Grow Your Business

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Use data to incentivize employees and drive growth.

By Mike Connors, PT, DPT, PhD

An employee is the best asset of any organization.

When you invest in an employee, you make the best investment in the future growth and sustainability of the practice. As employees gain more experience in your business, there is a natural expectation to have a subsequent increase in their compensation based on loyalty and performance. With the current climate of health care, it becomes challenging to meet this expectation.

Base salary is an employee’s benchmark of their performance and value to your practice. At some point in their tenure with your organization, there is a tipping point where base salary increases become unattainable due to the nature of declining reimbursement and escalating inflation rate. Therefore, it is imperative to utilize creative compensation models for employees. Compensation models vary based on the motivation of the employee and the extent to which the owners wish to pass along profitability to their staff. The best incentive programs balance owner profitability with rewarding staff for their efforts while being mindful to not create an undue burden on the practice.

So, what is the most optimal model to incentivize staff? Is there a one size fits all compensation model that makes all employees happy? The answer is no. The first step in exploring incentive programs is to evaluate the motivation of your staff. What motivates your staff? Is your staff motivated by praise, monetary rewards, or something else?

How do you figure out what motivates your employees? Ask them! What motivates you to perform as a therapist, owner, manager? What motivates you to increase your income?

Start with the end in mind

One way to incentivize employees is through a visit bonus. Set a target that achieves profitability for your clinic and incentivize your employees with an attainable benchmark that will motivate them to perform to achieve that bonus. First, you need to know the break-even visit target for your practice. Next, you need to set an achievable and realistic visit threshold level so that the visit bonus can be actualized through the direct efforts of your employees. There is nothing more demotivating than a bonus structure that is unattainable, so be sure to set the threshold to an achievable level so that your people will realize their incentive. Lastly, provide a monetary reward for each patient visit above an established threshold each week, month, or quarter. The benefit of this reward is that the physical therapist will become more efficient in the timing of and continued engagement of patients. Be sure to implement safeguards to ensure that a bonus structure is not abused by sacrificing quality care for increased volume.

A second way to incentivize employees is through sharing a percentage of net profit per month, quarter, or year. Profit sharing is a great way to motivate and compensate clinic managers or directors. In this scenario, a percentage of net profit is allocated as a bonus, assuming the agreed upon metrics to achieve the bonus are realized. This option allows an employee to share in the direct profitability of the clinic, much like an owner, without taking the step of opening their own practice. This is also a great way to illustrate to an employee an effective means of improving their overall compensation without placing an increased salary burden on the practice. While the practice experiences financial success, that success is shared with the employee.

Regardless of the bonus structure a practice implements, it is imperative for the criteria to achieve the bonus to be transparent so the employee remains engaged. The owner of the clinic should provide metrics that are achievable and attainable so that an employee is motivated to perform at a high level and realize a reward for their efforts.


Mike Connors, PT, DPT, PhD, is a PPS member and regional director of therapy for Greater Therapy Centers in Bedford, Texas. He can be reached at mconnors@gtc-pt.com.