I was recently on a LinkedIn forum, and the following statement was made about the out-of-network business model: “The cash-based practice will be almost non-existent when Obamacare is 100% implemented. We already have it in Massachusetts, and ever since it was implemented, there has evolved an entitlement mentality. That mentality: regardless of the value you provide, I can always find someone who provides exceptional value and NOT have to pay.” (I just want to note that reading this statement alone may sound a little malicious, but it was not meant that way and was made by a colleague of ours whom I respect a great deal).
Here was my response:
Why Obamacare Will Not Hurt My Physical Therapy Practice
I completely disagree with your statement, but before I explain why, I need to give you a quick overview of my physical therapy practice and experience in the cash-based realm… My practice is 100% cash-based, all sessions are a full hour one-on-one with me, cost $150, and I stay fully booked. Here is the key point as to why the implementation of Obamacare will not change that for me: over 93% of my patients do already have insurance and choose to not use it in order to get treatment at my clinic.
Different Mindset of Private-Pay Patients in Insurance-Based vs. Cash-Based Clinics
I can see how an insurance-based practice owner could come to the conclusion that cash-paying patients will largely disappear with Obamacare. Most of the people paying cash in those clinics are doing so simply because they do not have insurance, and must be cash-pay patients.
The cash-paying patients of a private-pay physical therapy clinic are quite different than those of an insurance-based clinic. They usually have health insurance, but they are willing to pay out-of-pocket for a service they perceive as higher value than insurance-based PT services. They are simply not part of the population who refuse to pay more “regardless of the value you provide.”
Even for really phenomenal practitioners, it’s hard to create a service that would be perceived as higher value than mine when they have to see multiple patients per hour and especially if they have to delegate treatment to techs or assistants. I’m not saying these things arrogantly or as if I’m a better PT than most others out there… there are tons of physical therapists who I’m sure could provide equal or better results than I do if they had a full hour with each patient.
Speaking of patient mindset … we don’t have to wait for Obamacare implementation in order to see an “entitlement mentality” among the general population when it comes to physical therapy. In a successful cash practice, your market/patient population are not the people with that mentality; and when the uninsured become insured in 2014, it’s not going to change the mindset of those who seek out my care.
Unless cash-based practices are someday made illegal (which would be the opposite of the free-market capitalism this country was founded on), my practice and my ability to treat patients in the way I feel is best, will not be heavily affected by the changes everyone seems so concerned about.
Do you have concerns about Obamacare and your current/future PT practice? Tell us about them in the comments below and share this post with your colleagues.