In 2005, Cody Barnett left his job to open a physical therapy practice because he wanted to be able to provide the kind of care that exceeds patient expectations. For the same reason, he had the intention of structuring the practice as cash-based from the start. However, with limited access to good resources on how to make that succeed, he felt he needed to bolster his cash-pay practice by participating with the two biggest insurance carriers in his market. But after years of fighting with insurance companies, he began “plotting his escape.” In 2015, he officially quit playing the insurance reimbursement game—going cold turkey and dropping all his insurance contracts.
Within 3 years, Cody’s cash-based physical therapy practice was going gangbusters. A couple years after that, he moved the clinic into a larger space and added full-time admin help and a staff PT. Today, his bustling practice is delivering high-quality care and changing lives, and all the time he once wasted with insurers is a distant memory!
In this interview, Cody shares how the transition was handled in terms of economics, logistics, marketing, referrals, and staff training.
More specifically, we discuss these cash-based practice topics:
- Why using the term “direct care” to describe his practice makes the sales process easier in his market.
- Exactly how he managed the transition to cash-based and how offering a slightly lower rate than what was the typical insurance reimbursement rate actually ended up being more profitable.
- Why it’s usually a bad idea for a new practice to start accepting insurance with the intention of becoming a fully cash-based later on.
- How to pull great ideas for optimizing patient experiences from unrelated industries so perceived value is maximized throughout every visit.
- Why it’s critical to fully educate your staff on the benefits of all policies and processes so you’ll gain buy-in and improve communication with patients.
- Why you should review insurance company contracts well in advance of any planned transition to cash-based so you don’t get stuck postponing the switch.
- The mindset tactics that gave Cody the confidence he needed to take the risk of cutting off all insurance contracts overnight.
- What specific steps the practice took to prepare for the transition
- How they were able to position their new cash-pay billing arrangements with existing patients so they could successfully retain as many as possible.
- The simple approach that works best for getting patients to post online reviews and why you should keep your own copies of all reviews.
- How the practice ramped up their marketing efforts to compensate for the gradual loss of virtually all physician referrals after the switch… though they lost every prior physician referral source over time, their business and new patients only increased!
- Key strategies for getting the best return from marketing efforts at races and other events.
- Why the current trend toward high deductibles has primed patients to understand the out-of-network model and appreciate the increased value such practices can offer.
Resources mentioned in this episode:
- Practice Perfect EMR