Offense vs. Defense

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By Paul Martin, PT, MPT, CBI, M&AMI

In typical market conditions, a practice can continue to grow and thrive with simply good defensive strategies: strong operational metrics, financial metrics and tracking, a solid referral generation program, strong leadership, and many other internally driven systems. We are not in a typical market. In fact, the current market has become extremely competitive based on large corporate providers who are acquiring and partnering with local businesses and committing enormous resources in order to grow these businesses into market leaders.

You must not only maintain strong defensive positions, but also in this market you need to go on the offense! Do a thorough market analysis and determine what specific programs you need to have to serve the current and future referral base, consider partnering with your current professional staff to strengthen your organization, and consider doing a few small acquisitions or startups to make sure that you have a strong presence in your market that is convenient to your current and new referral sources.

Reflections from Past Winners of the Private Practice Section’s Student Business Concept Contest

By Chris Wilson, PT, DPT, CHES

Another great Private Practice Section (PPS) Annual Conference has come and gone. In 2013, I was lucky enough to attend as the winner of the Student Business Concept Contest; and in 2014, I attended as a Private Practice Section member as well as an owner. Serving on the Membership Development Committee, I had the privilege of meeting and interacting with this year’s winners firsthand (as well as the fast-moving, newly formed student special interest group leadership). I was reminded of how much impact the Student Business Concept Contest had on me and thought it was a great time to reach out to other past winners and see if they had similar experiences.

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First, let’s talk a little background. Every year since 2006, PPS has sponsored the contest with up to two students winning an all-expenses-paid trip to the PPS Annual Conference. Destinations have previously included the Broadmoor in Colorado Springs as well as other resort-type destinations in New Orleans and Orlando. The financial value of the conference is estimated at $2,000 but the real value to the innovative students (who are selected based on their unique and complete business concept proposal) is found in the experiences they have.

In 2008, Travis Orth won. At the time, it was a much different contest—less about a business concept and more an essay contest about the future of private practice physical therapy. While Travis is still working toward a goal of opening a multidisciplinary clinic with superior patient care, he notes specific benefits of winning the contest; in particular, meeting the PPS president at the time, Steven Anderson. Anderson is the president of Therapeutic Associates and thanks to their meeting, Travis landed his first job and had numerous other offers based on connections he made at the PPS Annual Conference. His advice to current students: “Talk to as many people as possible, just take in the whole experience!”

In 2009, Jeff Donatelle won the essay contest by describing his aspirations to be a private practice owner. Jeff was smart to solicit the advice and editing skills of a mentor at the private practice in which he was finishing a clinical rotation. He notes that attending the Annual Conference as the student winner exposed him to innovators and forward thinkers who dominate the Private Practice Section. It galvanized his resolve to work in a private practice physical therapy setting as well as instilling in him a unique understanding of the value of the Physical Therapy Political Action Committee (PT PAC) for which he has led successful fundraising campaigns. He notes that it was a great experience and actively encourages today’s students to submit nominations.

In 2010, Mike Giunta was the first winner of the Student Business Concept Contest in its current format. His unique model revolved around incorporating community events such as food and clothing drives with wellness and fitness initiatives. Mike was also one of the first to bridge his idea into a real product that his clinic sponsors regularly. Like Jeff, he notes a primary benefit of winning the contest was the value derived in a unique networking opportunity. And, like Jeff, he also secured his first job outside of physical therapy school through connections made at the Annual Conference. One unique value proposition he notes is that simply taking the effort to apply is a great exercise in thinking outside the box. He notes that developing a mindset of young professionals who think outside the box is critical to the future of the profession.

In 2012, Justin Lee was selected as one of the winners for his concept RevoPT. It was a unique way to create custom home exercise programs with smartphone technologies. Justin and his partner Michael Wehrhahn were further along than most in selling the concept, having won some other awards and investors along the way. They approached the Annual Conference as an opportunity to sell their product and, in hindsight, view that as a mistake. Like the other winners, Justin noted the real value is likely the connections made, and he was unable to make as many connections because of his focus on selling his product. However, he did gain a better appreciation for the business mindset and business considerations of private practice owners as a result of his participation. His big takeaway: You need to understand your value proposition and be able to articulate it in a way that is meaningful to your target audience.

In summary, there are a great deal of benefits from both submitting and winning the contest. In addition to an all-expenses paid-trip to a fantastic destination, you are also developing an outside the box mentality, establishing a unique network of mentors, gaining a unique understanding of the business side of physical therapy, and possibly securing a great position after you graduate. Applications are due July 2015, so start developing your concept now and submit at www.ppsapta.org/c/StudentContest.cfm.

Daniel P. Staats, PT, DPT, OCS, MTC Cert SMT

Left: Dr. Staats with his children in the NY Mets dugout; Top right: Running for Special Olympics of NJ (Half Marathon); Bottom right: Catching waves in Bay Head, NJ.

Left: Dr. Staats with his children in the NY Mets dugout; Top right: Running for Special Olympics of NJ (Half Marathon); Bottom right: Catching waves in Bay Head, NJ.

Daniel P. Staats, PT, DPT, OCS, MTC, Cert SMT, is a PPS member and owner of Staats Physical Therapy in Brick, New Jersey. He can be reached at staatsphysicaltherapy@yahoo.com.

Practice, Location: Staats Physical Therapy, Brick, New Jersey. One location, seven employees, 11 years in practice, and eight years in private practice.

Who has been the most influential person in your career? The most influential person in my career has been Dr. Mitch Maione. I had the pleasure of working with Dr. Maione for 12 weeks in the spring of 2004 as I fulfilled my internship. I still to this day have never seen anyone treat like him. His manual skills, his intuitiveness, his creative thinking were unparalleled. He is the reason that I decided to pursue advanced certifications in manual therapy and orthopedics. I now teach my students the same techniques he taught me 11 years ago. His passion for the field of physical therapy has rubbed off on me and because of him, I strive every day to perfect my clinical skills and advance our profession. Dr. Maione currently is the director of the physical therapy assistant (PTA) program and university department chair at Keiser University in Florida.

What does your average week look like? I treat on average 12 to 18 patients per day with a two-to-three hour window set aside for administrative duties. I work 45 to 55 total hours per week.

What is your business philosophy? Strive for excellence and surround myself with people who do the same.

What has been your best/worst/toughest decisions? My toughest decision has always been and continues to be whether to outsource the medical billing or to keep it “in house.” I decided at the inception of my business that we would do all our own medical billing for ourselves. Some days I think we made the right decision and other days I feel outsourcing would be the best decision. Some days my staff and I grow tired dealing with all the delays of the insurance companies regarding reimbursement. Hopefully the reimbursement process will become simplified in the future.

How did you get your start in private practice? My first two jobs were working for corporate physical therapy companies. I was the clinical director for the second company and was performing most of the duties of an owner already. After I established a solid patient following, I decided to open my own practice.

How do you stay ahead of the competition? I focus on advanced evidence-based learning. I am constantly taking courses on the latest evidence-based medicine. All medical professions, physical therapists included, are constantly evolving and the clinician needs to stay up to date with latest advancement in his or her field. Physical therapy is a career that warrants a dedication to lifelong learning.

What are your best learning experience/s (mistakes) since the inception of your practice? The billing end of private practice was definitely a learning curve for me. I did not get much education on this in school and have had to learn mostly through experience. Physical therapy is a service-based industry. You provide the service and you get paid. Sounds simple, but with a third-party payer involved things get complicated. Staats Physical Therapy, LLC, has come a long way since its first year of private practice and rightfully so as the insurance reimbursement/ medical billing is as complicated as ever.

What are the benefits of PPS membership to your private practice? The American Physical Therapy Association (APTA) is a great organization, but they represent all aspects of physical therapy. The Private Practice Section is solely responsible for the advancement and professional protection of physical therapists in private practice. They are the only group that takes the time and puts forth the effort to fight for us on Capitol Hill and protect us from practice infringement. Supporting the Private Practice Section (PPS) is vital to the advancement of physical therapy private practice as a whole. I like the message boards and the online and paperback resources. They are usually filled with applicable material to my practice that I can implement immediately. I also like the emails that inform us on the latest political actions regarding physical therapy. I especially like the links that assist us in contacting our local representatives and senators regarding current issues facing physical therapy

What is your life motto? Love what you do and you will never work a day in your life.

What worries you about the future of private practice/What are you optimistic about? Every time one of my employees calls on an outstanding claim my bottom line is affected negatively. I worry about the declining rate of reimbursement and the increasingly arduous process of getting paid. The entire reimbursement process needs to be simplified.

What new opportunities do you plan to pursue in the next year? I will be moving my practice to a bigger location this year and plan to finish my musculoskeletal ultrasound imaging certification this spring. I will sit for the American Registry for Diagnostic Medical Sonography (ARDMS) exam this summer. I hope to finish and submit for publication a correlational study on the cross sectional area of the multifidi that I am working on with Dr. Mitchell Maione. Finally, I hope to get my dry needling certification. It should be an exciting year.

More Health Legislation to Come

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Is our grassroots program ready?

By Jerome Connolly, PT, CAE
July 7, 2015

Compliments of the Physical Therapy Political Action Committee (PT-PAC), your lobbyist was afforded the opportunity on June 2 to have dinner with Rep. Paul Ryan (R-WI), chairman of the House Ways and Means Committee. For over an hour the chairman engaged in a discussion of a wide range of topics from trade to tax reform. Rep. Ryan shared his philosophy, goals, and strategies as a leader of the conservative movement, the Republican vice presidential nominee in 2012, and chairman of the powerful panel that oversees almost every issue—including Medicare—in the House of Representatives.

The chairman was demonstrably proud that Congress accomplished the reform of the flawed sustainable growth rate (SGR) Medicare payment formula in April, but he openly continues to harbor aspirations for reforming the entire Medicare benefit. He sincerely believes the program as it is currently structured is not sustainable. He is convinced that it can only be saved by converting the entitlement to a premium support plan.

This is not new. Private Practice Section (PPS) members will recall that as chairman of the House Budget Committee, Ryan twice proposed spending plans that would replace the traditional Medicare benefit with a voucher system. To offset the cost, Ryan’s 2015 budget would have taken $140 billion from the SGR (provider payments), and another $110 billion in general Medicare cuts.1 Today, as a consequence of the successful repeal of the SGR in April, such savings would be hard to find.

But now Chairman Ryan says converting Medicare to a premium support plan will pay for itself by increasing competition, improving quality, and giving the beneficiary the choice of the type of insurance coverage purchased on the private market.

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This emphasis on private insurance would further empower health insurers that were situated strategically and considerably emboldened by the Affordable Care Act (ACA), which has resulted in record earnings reports of the nation’s largest insurers since the enactment of Obamacare. To wit: The five biggest insurers in the country are heading into a more stable future after their first quarter earnings reports show that they all are in good financial health in the post-reform market.2

  • Aetna reported that it made $777 million in net profit and $15.09 billion in revenue, an 8 percent increase from last year.
  • Anthem saw a 4.3 percent increase in enrollment (reaching about 38.5 total million members), particularly from its Medicaid plans’ 25 percent jump in enrollment to 5.6 million people in the first quarter. The company achieved a better-than-expected first quarter profit of about $865 million.
  • Cigna’s revenues reached $9.5 billion, an increase of 11 percent from the same time last year, which reflected a growth in premiums and fees.
  • Humana said its revenue rose 18 percent to $13.8 billion.
  • UnitedHealth posted revenue of $36 billion and net income of $1.41 billion in the first quarter, amounting to a 13 percent year-over-year growth. The nation’s largest insurer also added 1.6 million members in the past year.

These are the same insurers who are proposing double-digit rate hikes for 2016.3

Chairman Ryan’s Medicare reform proposal would replace Medicare’s guarantee of health coverage with a flat premium-support payment, or voucher, that beneficiaries would use to purchase either private health insurance or a form of traditional fee-for-service Medicare. (It would also raise the age of eligibility for Medicare from 65 to 67.)

Despite promoting this idea for several years, Ryan has provided few specifications for his premium-support proposal. However, his staff says that he is considering the “average-bid” model described in a recent Congressional Budget Office (CBO) report.4 Under this illustrative option, the value of the premium-support payment in a given region would be based on a weighted average of bids made by participating private plans and traditional Medicare in that region. (The bids would represent the amount that a plan would require to provide Medicare to a beneficiary of average health.) Beneficiaries who chose a plan with an average bid would pay only the standard Medicare premium. Those who chose a plan with an above-average bid would have to pay a premium that was higher by the full amount of the difference.

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The proposal’s impact on individual beneficiaries would differ depending on whether traditional Medicare or private plans cost less in their region, but it would disadvantage beneficiaries in at least two ways. First, in many regions, traditional Medicare would cost more than the premium-support voucher, so beneficiaries who chose to enroll in traditional Medicare would have to pay higher premiums than under current law. Second, beneficiaries who enrolled in a private plan would not receive the federally subsidized supplemental benefits that enrollees in private Medicare Advantage plans receive under current law.5

Chairman Ryan says that his premium-support proposal would not affect people aged 56 and older in 2014. But this claim is unlikely to be completely true since traditional Medicare would tend to attract a less healthy pool of enrollees (adverse selection), while private plans would attract healthier patients. The Medicare Advantage program provides a current example of this phenomenon. Although the proposal calls for “risk-adjusting” payments to health plans—that is, adjusting them to reflect their enrollees’ health status—the risk-adjustment process is highly imperfect and captures only part of the cost differences across plans that stem from differences in enrollees’ health.1

The process of legislating, according to Chairman Ryan, will essentially cease in Congress when the presidential political campaigns get going in earnest (some would argue they already are) so there is a limited legislative window. However, the GOP vice presidential nominee said he expects the Republican presidential candidate to be selected no later than May 2016 due to changes the Republican National Committee (RNC) has made to front-load the primary elections process. This means that little if any substantive legislation will get passed once Congress recesses for the holidays at the end of this year. Whatever does pass prior to that still must gain the approval of the current occupant of the Oval Office.

While Ryan is realistic, he is also determined to use the legislative process in every way possible to help the GOP win the White House in 2016, thus enabling one-party control of the legislative and executive branches. Once this occurs, he will be positioned to attain his goal of “voucherizing” Medicare.

In addition to Medicare reform, Chairman Ryan will attack other health care issues throughout the remainder of the year including bolstering the health savings account program, which he says was eviscerated by the ACA. Two other ACA provisions on Ryan’s radar for repeal include the medical device tax and the Independent Payment Advisory Board (IPAB); provisions that were included as a way to help pay for the health reform legislation. Moreover, he is also interested in reforming the post–acute care market by introducing bundled payment.

Given Ryan’s health policy priorities and our as yet unaddressed PPS priorities that include locum tenens, opting out of Medicare, and the therapy cap, it is clear that there is considerable cause for vigilance and engagement for the remainder of 2015.

Your PPS lobby team is leading the staunch effort on locum tenens and opt-out and participating with the American Physical Therapy Association (APTA)-led Therapy Cap Coalition in positioning the therapy cap repeal for the optimal political outcome.

However, a full PPS membership effort will be needed to accomplish our legislative goals and that brings me to the strength and effectiveness of our PPS grassroots mechanism.

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Your advocacy team was pleased with the responsive engagement many PPS members demonstrated in response to our numerous grassroots alerts on the SGR and therapy cap legislation in April. A similar membership-wide effort will be necessary again this year if we are to succeed.

While we can be justifiably proud that we have grown a large Key Contact program, it must be pointed out that we still lack Key Contacts for important target legislators (see sidebar). Therefore, it is critical that we quickly take determined strides to broaden and strengthen the PPS Key Contact program through which a PPS member acts as a trusted resource and PPS ambassador to a specific member of Congress.

In the Senate alone, a dozen critical legislators do not yet have a PPS member constituent committed to serve as a resource, an educator, and a relationship builder. These vacancies include four senators (Coats, Nelson, Stabenow, Warner) on the important Finance Committee and four members of the Health Education Labor and Pensions (HELP) Committee (Collins, Kirk, Murkowski, Sanders). Separately, three members of Senate leadership (Barrasso, Klobuchar, Wicker) are also without a PPS Key Contact.

In April, we fell two votes short of passing an amendment on the Senate floor that would have fully repealed the therapy cap. Sure, we can be proud of coming so close, but at the same time we should be disappointed. Two changed votes could have permanently eliminated an adverse and discriminatory policy that has been dogging our profession and our patients for nearly two decades. Yet we lack strong constituent relationships with twelve critical senators.

If we had had those strong relationships, which can be established and nurtured through an effective Key Contact program, would the outcome in the Senate have been different? We will never know for sure. However, what I do know from my vantage point of working in congressional relations for over 20 years is that without such connections, the chance of optimal outcome on such a vote is diminished if not obliterated.

On June 4, APTA coordinated a physical therapist Hill Day preparing and ushering nearly a thousand APTA members to Capitol Hill for a rally and for visits with their members of Congress. The previous evening, in her remarks opening the APTA Annual Conference (“NEXT”), legendary tennis professional Billy Jean King stated: “Every single one of you is an influencer.”

PPS has established a Key Contact Task Force charged with the mission of recruiting and training PPS members to become effective Key Contacts. For your patients, your profession, and your practices, please step forward and let’s fill our Key Contact vacancies with eager and enthusiastic private practice physical therapy advocates. Please contact task force chair Kathleen Picard (kathleenpicard28@gmail.com) and tell her you are willing to do your part.

“Every single one of you is an influencer!”

References

1. Van de Water P, Medicare in Ryan’s 2015 Budget, Center on Budget and Policy Priorities, April 8, 2014.

2. Insurers Navigate Health Overhaul to Rising Profits, Associated Press, April 29, 2015.

3. Nesper M, Insurers propose double-digit rate hikes, Employee Benefit News, June 3, 2015.

4. Congressional Budget Office, A Premium Support System for Medicare: Analysis of Illustrative Options, September 2013.

5. Congressional Budget Office, A Premium Support System for Medicare, pp. 4-5.

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Jerome Connolly, PT, CAE, is a registered federal lobbyist whose firm, Connolly Strategies & Initiatives, has been retained by PPS. A physical therapist by training, he is a former private practitioner who throughout his career has served in leadership roles of PPS and APTA. Connolly also served as APTA’s Senior Vice President for Health Policy from 1995–2001.

Insurance Verification

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An open door to communication about financial issues with patients.

By Connie Ziccarelli

In these changing times, insurance benefits are also changing with every renewal date. Because of these constant changes and your clinic’s need for cash flow, it is important to verify insurance coverage and benefits for every patient. Whether the patient is new to your office or a return patient, knowledge is the key to smooth payment issues.

With today’s technology, it has become easier to verify coverage and check for benefits on your computer. Most companies make this process easy and user friendly but that is not always the case. Some companies do not delineate outpatient physical therapy benefits from their standard medical benefits. Sometimes the benefits are the same, but I have also found that the limitations differ from policy to policy and even patient to patient within the same employer group. Employers offer different benefit levels based on the policy the patient wants to subscribe to. Do not assume they are the same. Know what those limitations are—whether it is the number of visits allowed, maximum payout, or specific exclusions.

Most patients are uneasy about what their insurance company will or will not pay and what their out-of-pocket expense will be. Notifying the patient of their financial responsibility is an important part of the treatment cycle and to the clinic’s cash flow. Having a conversation or presenting a written explanation of benefits often opens the door to understanding on both parts.

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The important components of an insurance verification letter should be:

  • The date of verification
  • The person that quoted you the benefits (if you spoke to someone)
  • The effective date of the policy and as well as the termination date, if quoted
  • The deductible amount and the amount applied to it, especially if outpatient physical therapy gets applied to it
  • Coinsurance amount after deductible is met
  • Out-of-pocket amount that must be paid before insurance will consider payment at 100 percent and the amount that has been applied to it
  • The copay amount per visit
  • Physical therapy limitations on the policy
  • Whether physical therapy needs to be preauthorized and who to contact if so
  • Who you spoke to in order to authorize care and the number of visits that they authorized
  • Always include a disclaimer stating that the authorization are not a guarantee of benefits and that payment will be considered based on the policy provisions in effect at the time the service is rendered.
  • Include an estimated amount that is due from the patient at the time of service unless prior arrangements have been made with the patient and the method of payment has been agreed on (credit card, cash, or check).
  • Always include a thank you for your business and a contact number if they should have questions regarding these benefits.

By opening the door of communication with your patients regarding their financial obligation you will create a smooth experience and a healthy cash flow. 

Ziccarelli,-Connie

Connie Ziccarelli is the chairperson of the PPS Administrator’s Council and an APTA member. She is also the cofounder, principal and chief operations officer of Rehab Management Solutions in Sturtevant, Wisconsin, where she manages, grows, owns, and operates a nationwide network of private practice physical therapy clinics..

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