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While none of us have a crystal ball, if you are paying attention to the world of physical therapy, you know that the treatment set up is evolving. Look at how doctors offices are operating – a doctor, a certified registered nurse practitioner or position’s assistant followed by an medical assistant. All of these team members can provide reimbursable care to their patients based on morbidity levels of the patients and the educational level of the professional. This is a tiered approach that encourages the use of care extenders.
The writing is on the wall and physical therapy practices across the country will soon be operating under this model as well. You don’t have to look for signs of these pending changes. First, the morbidity level of the evaluation codes changed. Now it’s the reduced reimbursement that Medicare is paying physical therapy assistants for delivering the same care to the same patients reduced to 85% of what the doctor of physical therapy is getting starting in 2022.
The Team Approach
If you think about the best arrangement to succeed, it’s teams. Start setting your clinic up into teams – red team, blue team, green team – whatever you want to call them, and get prepared before you’re playing catch up.
With this team approach, you have DPT1, DPT2, PTA, TECH. All physical therapy evaluations are done and the plan of care is then scheduled out in its entirety between two therapists within your team. This will be helpful to the front desk as well because it gives them double the days and times to pick from when scheduling patients out their entire plan of care. The tech also becomes well known and trusted among the team so the confidence in them is high. We can only hope that reimbursement will be coming for their part in the patient care similar to the medical assistant’s in the doctor offices.
What About Shrinking Reimbursements?
Unfortunately, with these changes, it’s likely we’ll see a flattening of reimbursement heading our way. Let’s face it, the studies are telling us that 10,000 people are turning 65 every day in this country and that is not going to end until after 2025. With Medicare already running out of money, something drastic is going to need to change with reimbursement. Hence the physical therapy assistant reduction. It would only make sense that lesser expensive caregivers will also soon be allowed to be a part of this process. Thus, reducing the number of interactions needed by the doctor of physical therapy – the highest compensated member of the team.
Payment models will likely look more a tiered model with one flat rate for each type of provider and a multiplier associated for the level of morbidity assessed during the evaluation as established with the three evaluation codes put into use two years ago.
You’ll likely see more private carriers going to flat-rate payments for physical therapy visits as well. In NJ and NY there is already talk about getting rid of out of network benefits. So many providers in that region cannot afford to work in-network causing them to only accept out of network patients. This is cutting off access to high-quality providers for patients, while on the other hand, raising the reimbursement for the average physical therapy practice from $73/visit to over $123/visit. And rightly so. No DPT should be making less per visit than a massage therapist who has a certificate for 18 months of training while a DPT has a doctorate degree after 6 plus years of training.
These flat rate payment models will become the norm and pay for performance will be an incentive to make more money for the higher quality providers. Sound familiar? While we’re still learning the impact of MIPS, no one really knows what the effect will be until after being in the system for more than two years and the payments start rolling in. Only in the most illogical manner would any organization map out a new payment model in such a way that you literally have no way of knowing whether or not you are in for a penalty or a reward until the payer tells you the provider. Talk about being the effect and not in control.
Why does this matter? Because every experienced business coach will tell you that when you increase your control in any area the more likely you will have increased income. More control equals more income, more the effect more stress.
Ultimately, this leads all of us one step closer to universal health care. They must first streamline the payment system and make it more linear to invite more care extenders with some minor reimbursement to deemphasize the need for more higher-end professionals. All of this is currently in motion.
Go Hybrid
What can you do about it? You can hybridize your private practice. Go with a gold level care model for all insurance carriers and then create a Platinum level care of model that is all cash-based services. This will be the best of both worlds and allow your patients to get exactly what they are paying for. If you go to a franchise style restaurant, your expectations may be different than when you go to a privately held restaurant. The private restaurant is making it on reputation and repeat business and therefore it’s all about the over the top experience with each customer. The franchise restaurant is most likely working with a big advertising budget and lower end food bought in bulk and standard wages for each position preventing them from attracting the best team to come work for them. Yes, there is a lot to be said about the economy to scale, but there is even more to be said for your name especially when your reputation is on the line.
Now is the time to branch out and learn more about innovative cash-based services and administrative standard operating procedures so you can continue to compete at a very high level as our market changes. Consider outsourcing billing and bookkeeping while providing unique services such as dry needling, Biphasic high volt stim from the revolutionary Neubie stimulator – these will all contribute more to your success rate. Contact us to learn more about outsourcing your billing or for strategies on converting your practice to a hybrid model.
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Brian Gallagher, PT is the founder and CEO of MEG Business Management, LLC. He has more than 27 years of experience in the field of rehabilitation and 19 years in business and specializes in Physical Therapy practice management and executive coaching nationwide. As a licensed business management consultant, Brian has helped hundreds of business owners nationwide improve their business operations through proper restructuring to achieve improved systems of efficiency and productivity as well as marketing and sales with effective public relations which have proven results for double-digit growth year-over-year with businesses around the country.
