There is a fairly common question/concern I’ve been hearing from those considering cash-pay physical therapy services or completely converting to or starting a Cash-based PT practice: “Is a Cash practice even a viable option in my city?” In other words, “If I do this, will there be enough people with the means and willingness to pay out of pocket for my services, or will I find out that this model just isn’t feasible in my area?” Something to keep in mind is that the above question stems from the more primary question “Will I be successful in a Cash-based practice?” The answer to this obviously goes far beyond the location of your clinic and demographics of your city. Even so, these things do need to be evaluated .. with some important things kept in mind along the way.

Location data for a private-pay practice

As you research demographic information about your city, you need to ask the question, “what is this information really telling me?” has pretty extensive demographic information on most cities, but I sure am glad I didn’t review it before I started my cash practice in Austin TX. When you use this or similar websites, here are some things to keep in mind:

  1. You are looking at averages. According to the average household income in Austin TX was only $50,132 (in 2009). Not a number you would imagine provides a great deal of leeway in the budget for $120/hour PT treatments. Even with those stats, my schedule stays full, and the same is the case for other Cash-based PTs in the greater Austin area. Guess the median household income for New York City … according to, it was $50,033 in 2009. I can guarantee you that New York City can (and probably does) support many cash-based physical therapy practices. As I explain in my post You may be surprised at who is willing to pay out-of-pocket for your services, your patients won’t necessarily all be wealthy, but the majority of your cash-paying patients will likely come from the upper half of the income spectrum in your area. So don’t put too much weight in the averages you see online.
  2. The areas you consider to be your city may technically be different cities altogether. When people ask me where my physical therapy practice in Austin is located, I answer “Westlake.” According to Westlake Hills and other similar areas are listed as separate cities even though most people consider them “part of Austin” (look for the list of “nearest cities” when reviewing your city at The average household income for Westlake is $156,017. Quite a difference! Even so, the majority of my patients live within what considers to be “Austin.” So, again, it’s not only about how many wealthy families there are in your immediate area.

Location considerations for a cash practice

If you don’t already have an established practice or will be choosing a new location, finding something in the more affluent areas of town is of course preferable. Since many of your patients will living in these areas, it makes sense to be located as conveniently as possible. I also think people will be less likely to pay cash for PT in a not-so-nice area, or in a complex/building that isn’t attractive. Most of your patients will also tend to be people that place a higher-than-average value on their time. For all these reasons, being located in the nicer and more affluent areas of town makes sense, even if you have to pay a little extra for it. With all that said, people who are willing to pay out of pocket also tend to be those who are willing to travel a distance if it means getting the best treatment and results. Therefore, if you’re not already located in an affluent area, or can’t get set up in one, it doesn’t mean your cash-based practice plans are dead in the water.

Trends in your area – targeted marketing to specific groups can very quickly build a following.

Is the population in your area generally active? If so, this will be a big positive in your ability to make a Cash practice work. However, if the answer to that question is “no,” that doesn’t mean that active parts of the population do not exist. Do some searches for running clubs, gyms, golf courses, athletic groups, youth sports, high school sports, etc in your area. You will get an idea of how much opportunity there is for targeted marketing to the population subsections that will fill your clinic. Check out this post for a just a few of the many niche markets you can target as a fee-for-service Physical Therapy clinic.

Success in the private pay practice model

If it isn’t already clear, I truly believe that successful Cash-based PT practices are possible in most non-rural areas (and probably many of those as well). In weighing whether or not you can succeed in this model, I think a much more important question is this: “Can I find and market effectively enough to those in my city who are willing to pay cash for my services?” For this reason, over half of my cash practice guidebook is dedicated to doing exactly that.

So of course you need to do your market research, but consider the sources of the information and the true meaning of what you are analyzing. Just because your “city” has a population of 50K with a median income of less than $45K, doesn’t mean there aren’t plenty of people in the greater area willing to pay out of pocket for high-quality health care. No doubt some cities will be more supportive of Cash practices than others, but did you imagine Austin Texas would house a number of these practices? Demographics can be important to a point, but it’s much more about finding and engaging the groups in your area who place a high value on health, wellness, and optimal functioning.

Interested in the cash-based private practice model?

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