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Everything You Need to Know About POPTS

Take a deep dive into the history of the legal loophole of physician-owned physical therapy services—a.k.a. POPTS. Click here to learn more.

Meredith Castin
5 min read
November 26, 2018
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From day one of physical therapy school, we were taught to not even entertain the idea of working for a POPTS practice. I remember hearing the words, “Your license is on the line,” and feeling vaguely scared of the potential fallout from joining one of these heinous practices. But, I was so overwhelmed by the immediacy of school concerns that I didn’t take the time to consider why.

I never did work for a POPTS clinic, but I know lots of folks who do—or who have done so in the past—and they don’t have quite the same visceral reaction to them that so many PTs do.

So, why are people so opposed to POPTS?

Let’s explore the idea of POPTS and delve deeper into why people feel so strongly about them.

What is POPTS?

POPTS stands for physician-owned physical therapy services. The term POPTS generally refers to a physician practice under which PT interventions are delivered. In other words, these are organizations where physicians and therapists—and, in some cases, other medical professionals—deliver care under a single umbrella practice. As such, physicians typically refer patients who need PT to a therapist within their own clinic.

As you can imagine, this setup can be very lucrative for physicians.

How did POPTS come to be?

It’s tough to nail down when, exactly, this arrangement first came about. However, we do know that the APTA has actively opposed POPTS practices since the 1970s. We also know that POPTS started to receive heavy scrutiny in the late 1980s, when Representative Pete Stark (D-CA) began pushing Medicare legislation to help restrict physicians from engaging in referral-for-profit activities.

Unsurprisingly, many physicians opposed such legislation. But a study released during this time did find that, compared to referral relationships in which the physician had no financial interest in the delivery of PT services, POPTS arrangements resulted in higher costs and service utilization.

The Ethics in Patient Referral Act (also known as The Stark Law) was passed in 1989. It aimed to minimize the number of financially motivated physician referrals. However, the law contained a clause—many people prefer to call it a loophole—permitting physicians to own in-office ancillary services (IOAS).

While the law initially dissuaded physicians from engaging in POPTS practices, by the time the 2000s rolled around, the financial squeeze of managed care and the impact of reduced Medicare payments led many physicians to seek out new ways to make up for lost income. Some interpreted the Stark Law’s IOAS clause as a green light to add in-office physical therapy services, rather than referring patients out to freestanding PT clinics. And with that, the POPTS movement reemerged.

Are POPTS legal?

POPTS are technically legal, although many would argue that this is a perfect example of circumventing the intention of the Stark Law.

For its part, the APTA staunchly opposes POPTS for several reasons:

  • Some POPTS arrangements take referrals away from PT-owned outpatient centers, making it more difficult for PT-owned practices to thrive.
  • Referral-for-profit arrangements can cultivate relationships based on financial incentives, rather than professional collaboration, patient needs, and mutual respect.
  • A physical therapy licensing board has no jurisdiction over physicians who own physical therapy services, which decreases the level of oversight and protection for the public.

Why are POPTS so controversial?

Beyond the APTA’s reasons, many physical therapists understandably bristle at the thought of any other medical profession “owning” us. After all, we’ve fought hard for direct access and the ability to call ourselves doctors. Also, many therapists in POPTS practices have expressed concern about physicians being unavailable for consults with PTs (despite being in close proximity), and some therapists confirm that they often feel that their services are recommended for patients who don’t really need them.

We must also consider the potential for conflicts of interest, as noted above. Physicians can certainly be tempted into unethically pressuring PTs to over-utilize therapy services for the sole purpose of increasing profits. With overuse of covered services already causing concern in the healthcare world, the self-referral aspect of a POPTS clinic is worth close consideration.

Why do PTs continue to work for POPTS clinics?

So, if POPTS clinics are so controversial, then why do physical therapists continue to work in these settings?

The Benefits

We’ve established that POPTS clinics can be very financially successful. Employees of financially healthy practices often receive ample support in their work—including benefits, paid time off, raises, and paid time for documentation. In a time when many PT-owned practices expect therapists to document off the clock—and provide barebones benefits and pay in return—you can’t really blame therapists for seeking a supportive, comfortable work environment with fair pay. And that’s especially true for those job-seekers who recently graduated from PT school—and are feeling the weight of their staggering student loans.

The Built-In Referrals

For a PT who wants to spend his or her time treating—rather than marketing and struggling to attract patients—working at a POPTS practice is all but a guarantee of steady referral traffic. For some therapists, this alone is reason enough to join such a practice.

The Camaraderie

The ability to work as part of an integrated care team should not be discounted, as that’s a huge part of what attracts many therapists to POPTS clinics. I’ve heard many iterations of the same sentiment over the years: “It’s nice having the MDs right there to ask questions.” Or, “I love that I can just send the patient next door if something seems amiss.”

If we truly want to provide integrated, patient-centered care, we can’t really argue against the exceptional opportunity for collaboration among MDs, therapists, and other professionals that POPTS clinics afford.

Where are we with POPTS today?

With the growing focus on value-based care, it’s important to consider where POPTS fit in.

The APTA continues to oppose what it views as a loophole in a law meant to fight wasteful spending. However, the organization asserts that a reformed Stark Law with fewer loopholes might promote the growth of value-based care, because it would level the playing field for PTs.

Justin Elliott, APTA's vice president of government affairs, stated, "Effective value-based care is important. Eliminating conflicts of interest in health care is important. There's no reason why the two can't coexist."

As of 2017, the APTA is working with the Alliance for Integrity in Medicare (and has the support of the AARP) to champion a bill in the House of Representatives that would eliminate the IOAS exemptions.

In the meantime, the APTA has created a “POPTS Survival Guide” for those inclined to continue fighting the practice.

Have you ever worked in a POPTS clinic? Do you currently? Please share your experiences in the comment section below.


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