Board Perspective: Navigating the Future of Private Practice
Over the last year, we’ve all needed to escape to some degree. What do you do to unwind?
Ali: I reserve Wednesdays to get outside and usually hike or ski with a group of amazing women.
Mike: My daughters and I started working out together in the clinic at night. Exercising, laughing, and reflecting on what is truly important is a great way to end the day.
Stacey: Skiing, coaching softball, family time. The pandemic has definitely forced me to slow down and enjoy everyday things.
Kelly: Given the differences in the past year versus a year without a pandemic, the things I found escape in were the once labeled “little things”—being outside, exploring, family dinners. I now cherish and find so much more gratitude in these things than pre-2020.
Amy: Long walks are a great way to clear my mind. I love to cook with my family, which often leads to a kitchen dance party.
With all the legislative and physical therapy practice changes that have occurred recently, our heads are all still spinning a bit. Which ones do you expect to become permanent fixtures? Which ones will go away?
Ali: I think we’ll see telehealth for physical therapists become permanent, but it will take work on our part to get the legislative changes needed. I also think we’ll continue to see employers being able to pay off student loan debt without it being taxable to the employee. Unfortunately, I believe payment parity for telehealth will go away.
Mike: The 2% suspension of sequestration will go away at some point in time. I am hopeful some of the telehealth provisions that make access easier for patients will remain beyond the pandemic.
Stacey: I expect some form of telehealth or electronic communication with clients to stick. I also feel a declining Medicare payment environment will continue to stick, though I don’t agree with it.
Kelly: I am speaking as an individual. I see many of the telehealth changes staying and finding their way into permanency both at the state and federal level as well as the payer level; we are already seeing some of those things occur. It is my sincere hope that, as practices, we will embrace this new digital medium of practice and incorporate it into our care paths as the consumer will drive easier access to care.
Amy: I think that telehealth will be an initiative we will continue to see evolve and change our profession. I don’t believe it should or can replace our clinical care, but it will influence our future. I am looking forward to social distancing going away.
If declining payment becomes a trend, how do you recommend practice owners go about creating healthy profit levels?
Ali: Opt out of network for Medicare (still seeing medicare patients, but at 115% of the fee schedule). The challenge here is that the patient receives the payment, and has to pay the practitioner, which has its downside.
Add more fitness and prevention programs, with a transparent flow between that and the clinical services, and a connection to other health care providers such as nutritionists, so patients see the value of having this provided by a physical therapist.
Offer a cash-based payment system for those whose insurance has a high deductible or co-pay, or allows the patient to get out from under third-party reviewers who restrict visits and put too much emphasis of the treatment time on documenting tests, etc., take the therapist’s time away from actual treatment trying to fight to get reimbursed or authorized visits. Make this very visible to one’s patient population, with no apologies. It should not be an afterthought.
Kelly: Push into new areas, work directly with employers, stop taking contracts that don’t cover your cost per visit, start working with other physical therapists in our areas. There is plenty of business for every physical therapist out there, we only serve about 10% of the people that could benefit from our services. We must spend our energies on forward looking items, not just how can we squeak by with lower paying contracts. This is easy to type but not easy to do. We have some tough decisions and a lot of work ahead but if we do it together, embrace the things we can do as physical therapists and work to educate other healthcare providers, payers, employers (the real customer of payers) and the consumer on how effective we are for both outcome and cost.
Amy: Practice owners need to be aware of their own KPIs and industry benchmarks to help them manage and lead their practices.
Mike: Simplify and focus on what matters! Most practices (including our own) have things that are 100% in our control that we don’t manage as effectively as we should. In reviewing the PPS KPI data, the most profitable companies focus on the basics and execute well. They make sure their therapists are taking care of the right amount of people (visits/FTE) and are billing for what they do (timed units per visit). Small changes in these metrics move the profitability needle dramatically.
What do you see as the biggest challenge to private practice physical therapists in the next five years?
Ali: Consolidation in the marketplace; partly due to low and disparate payment pressure that will persist (for OP vs hospital and large organization payment that have better negotiation power). Technology will bring more resources to the patient, that may replace some of what we typically do in the office. The challenge will be for physical therapists to be the ones to own this space, versus losing it to other types of practitioners and businesses.
Mike: Having to work harder (administrative burden) for less (declining payment) will be an ongoing challenge. I’m encouraged by the collaborative conversations that are happening across Sections of APTA and with outside parties who have a shared advocacy interest. There are several levers we can pull in this area and coordinating them is essential. We must create a united national strategy if we are going to change the trajectory on payment and administrative burden.
Stacey: The rising cost of physical therapy education is a serious concern. There is a large gap developing between what physical therapists are paying for their education and payment for our services through the third-party payer market. I worry about our ability to sustain this current model without a drastic change. The only change that we, as a profession, can have some real control in, is the cost of our educational process.
Kelly: Relevance. Our patient (consumer) is changing as well as the world around us. We must change and evolve with their needs and wants. I believe we need to look forward as a profession and realize that the digital era is here (has been for a long time), and we will no longer be able to remain relevant if we don’t work to push outside of the four walls of our clinics. We will be replaced if we don’t by other professions. I believe that physical therapists can single handedly help the US health care system better manage many of the issues we sadly don’t manage well, starting with musculoskeletal care management. We know that we are more effective, have better outcomes, are less invasive, and cost less than other interventions in this realm, yet we remain behind. Imagine if we can “keep America moving” and not have patients be limited by musculoskeletal issues. What impact could we have on chronic diseases like diabetes, cardiopulmonary disease, obesity, etc.? Physical therapists are uniquely qualified to address movement disorders. We have to come together, educate the consumer on what we do, meet them where they want care (in clinic, home, work, online, etc.,) and do our jobs. The health of our nation is depending on it.
Amy: Payment has been and will continue to be a challenge for the private practice physical therapist.
A lot of practice owners are concerned with the direction of payment for our services. What can we expect in the future?
Ali: This is such a struggle. Unless we can get CMS to see the value of physical therapy and pay for it appropriately, I think we are going to see low payment persist.
Mike: We must have a more coordinated and collaborative national strategy to address Medicare payment and administrative burden if we want to see a different result. Each of us will have an important role to play in the future, and we must not let the frustrations from the past take away our purpose or our fight.
On a more optimistic note, the growing gap between hospital and private practice payment is looking like it is transitioning from a frustration to an opportunity. Recent price transparency legislation is making it easier to demonstrate our value proposition to self-insured employer groups. We are positioned perfectly for a collaborative PT-driven solution that improves their bottom line and ours.
Stacey: In the third-party payer market, there is serious downward pressure in payment. The strongest recommendation I would provide to every practice owner is to consider the contracts you are signing. Accepting money from a third party means you have agreed to a contract. Is the contract fair for your service model? What is the consequence of NOT signing the contract? Will you lose referrals, or may you possibly keep the referrals? Manage a level of profit for your services. Understand your cost numbers very well to help you make proper decisions for your practice.
Kelly: A tough road that requires a lot of advocacy and grit. We need to show our value and work as a community of physical therapists to not be our worst enemy. We cannot have colleagues accepting low payment, it’s just a race to the bottom. It is going to require that we work together and push outside of comfort zones.
Amy: I wish I knew too! I believe that each owner can help these efforts by understanding their own contracts and working to negotiate for fair payment. It is also each of our responsibility to be involved in grassroots advocacy to help shape our future.
What adjustments can practice owners make now that will help them succeed in the future?
Ali: Look closely at their payment from each insurer and try to build up referrals from the higher paying sources, to offset the low paying ones. Turn down contracts that do not provide for any profit. Add cash-based services, either by hiring, contracting, or just renting space in the off hours, to people such as yoga and pilates instructors, personal trainers, massage therapists, nutritionists, etc.
Mike: Invest in yourself! Find a group of people who care enough to ask you the hard questions you don’t want to answer. Leadership is lonely. Having a group that is supportive, understanding and will also hold you accountable is a wonderful gift that our Section offers. I’ve found the bar at annual conference and Peer2Peer to be a great place to meet these people.
Stacey: There are many adjustments that are options. Each practice is so unique in their location, clients, payers, relationships, etc. I think it is always wise to take the time to step back when you can. If the environment is changing, it is important to be able to identify it. Then you need to decide if you morph with the changes or if you start to find a new direction. There is a time to fight and there is a time to just change course. Sometimes the line between the two is difficult to identify.
Kelly: Know your business. Know your costs, live within them, and only accept business opportunities/contracts that cover those costs. Get out there and educate, educate, educate on what we do as physical therapists, how we can help not only the individual but the entire health care system in our country. Keep moving!
Amy: Never stop building your team. Keep fighting for our profession and the patients we serve. Get involved at PPS, we are stronger together.