If I challenged you to find a rehab therapist who didn’t believe in the power of evidence, you’d be searching for a while—forever, hopefully. After all, PTs, OTs, and SLPs are steadfastly dedicated to evidence-based clinical practice, because they know it gives their patients the best possible chances for success. On the business side of therapy practice, however, the application of evidence—a.k.a. data—is something many rehab therapists have yet to fully embrace. Payers, on the other hand, have been on the data train for years, using the information they collect to determine fee schedules—which, in turn, determine how much you’re paid for the services you provide.

That’s not to say providers have no influence over the contracts they sign. There’s always room for negotiation, and we here at WebPT have always encouraged therapy professionals to lobby for the terms they want. (For a primer on effective negotiation strategies, check out this blog post and this follow-up post.) But without hard facts to support your demands, your push for higher rates will be an uphill trek of Mount Everest proportions. Rehab therapy industry leaders know this, and that’s why they’ve put so much effort into providing therapists and practice owners with the data they need to obtain the payment rates they deserve.

Losing sleep over healthcare reform?

Enter your email address below, and we'll send you our free healthcare executive's guide to maximizing both clinical and financial results—whatever regulatory curveballs come your way.

Please enable JavaScript to submit form.

One such effort: the Milliman Project, led by the APTA’s Private Practice Section (PPS). According to information presented in a recent PPS webinar, the project involved analysis of “commercial insurance and Medicare data” to come up with “cost per unit benchmarks for physical therapy services.” Essentially, the goal was to establish the average allowed amount—broken down by geographic region—for a variety of individual CPT codes. The data set also includes dollar amounts marking the 50th and 90th percentiles for payment of each code. This information allows therapists across the country to:

  1. compare their rates to the average payments in their regions of practice, and
  2. nail down data-backed starting points for insurance contract negotiations.

PPS has yet to release the full Milliman data set, but during the webinar, presenters reported that the average allowables for commercial payers typically fell between the 50th and 75th percentiles, a range that is 33% to 50% higher than Medicare’s average allowables. Of course, rehab therapists must take all of these figures with a grain of salt, because the study did not exclude non-therapist providers from the data set. In other words, some of the payments—though linked to therapy CPT codes—actually were received by other types of providers (physicians, for example).

Furthermore, while I applaud the APTA’s efforts to provide therapists with real, solid data to back up their contract negotiation efforts, I can’t help but wonder how applicable this information will be in the coming months and years. After all, with the entire US healthcare system moving toward a value-based payment environment—and fast—it’s only a matter of time before the current fee-for-service (FFS) payment paradigm is a thing of the past. Soon, pay-for-performance will be the name of the game. (And when I say soon, I really mean it; as noted in this post, the US Department of Health and Human Services plans to base 30% of all Medicare FFS payments on alternative payment models by the end of 2016, with that proportion increasing to 50% by 2018.)

This is a huge change, and it will require rehab therapists to completely shift their mode of thinking when it comes to documenting—and billing for—the services they provide. (That’s why our webinar this month will focus on pay-for-performance.) The value-based payment models of the future will deemphasize the number of codes a provider bills—and the reimbursement amounts attached to those codes. Instead, payment will hinge on patient outcomes, which means effective contract negotiations will hinge on outcomes data. This is the information that will prove your value as a provider—in terms of your role on each patient’s overall medical team as well as your unique ability to deliver effective, cost-efficient care.


So, if you haven’t already started tracking outcomes, I urge you to put it on your radar. (For an in-depth look at how and why you should go about implementing outcomes tracking in your practice, check out this post I wrote for Nxt Gen.) After all, the best intelligence is the kind that allows you to get ahead of the curve—not merely keep up. And the way I see it, the impending shift to a value-based payment atmosphere puts rehab therapists in a prime position to take the lead.

The State of Rehab Therapy in 2019 Guide - Regular BannerThe State of Rehab Therapy in 2019 Guide - Small Banner
  • Past, Present, and Possibility: The Progression of Pay-for-Performance Image

    articleMay 7, 2015 | 5 min. read

    Past, Present, and Possibility: The Progression of Pay-for-Performance

    For decades, healthcare leaders have searched for a way to balance the interests of providers, patients, and payers. The pay-for-performance paradigm has emerged as a front-runner in the race to drive down healthcare costs while simultaneously raising the quality of care and increasing patient satisfaction. But what, exactly, does this buzz term mean? Defining Pay-for-Performance As this Health Affairs article explains, the pay-for-performance umbrella encompasses any “initiatives aimed at improving the quality, efficiency, and overall value of …

  • Triumph in the Triple-Aim Game: The Healthcare Executive’s Guide to Readmission Reduction, Patient Safety Promotion, and ACO Success Image

    downloadSep 28, 2016

    Triumph in the Triple-Aim Game: The Healthcare Executive’s Guide to Readmission Reduction, Patient Safety Promotion, and ACO Success

    The Affordable Care Act (ACA) and other reform efforts have brought forth a renewed emphasis on care coordination at all points along the care continuum—including the period after hospital discharge. As part of this push, new financial incentives and penalties have put healthcare executives at the center of a high-pressure game of tug-of-war in which they must simultaneously improve care quality and reduce costs. Talk about a catch-22. Enter your email address below to download this guide …

  • America’s Next Top Payment Model: The Move to Pay-for-Quality Image

    articleMay 11, 2015 | 9 min. read

    America’s Next Top Payment Model: The Move to Pay-for-Quality

    Your mission, should you choose to accept it, is to provide higher-quality care at a lower cost. With the healthcare industry’s fast-moving transition to value-based —rather than service-based—payment systems, that’s the challenge many providers are facing. And while that mission may very well seem impossible, the truth is that rehab therapists and their peers in other medical fields don’t really have much of a choice as to whether they’ll accept it. [webform:1307:yellow inline] The winds of change …

  • CMS Can See Clearly Now, Releases PQRS Strategic Vision Image

    articleMay 21, 2015 | 3 min. read

    CMS Can See Clearly Now, Releases PQRS Strategic Vision

    All month long, we’ve talked about the healthcare industry’s rapid evolution from the fee-for-service Stone Age to the pay-for-performance Enlightenment Period. Yes, payment reform is upon us , but don’t take our word for it—take it straight from America's largest payer of healthcare services: The Centers for Medicare and Medicaid Services (CMS). In an effort to “contribute to improved healthcare quality across the nation,” CMS recently published the Physician Quality Reporting Programs Strategic Vision , detailing a …

  • CPT Update: Why the Valuation of the New PT and OT Eval Codes is Problematic Image

    articleJul 19, 2016 | 9 min. read

    CPT Update: Why the Valuation of the New PT and OT Eval Codes is Problematic

    The purpose of any type of reform is to drive change. And that’s certainly true when it comes to healthcare—and healthcare payment—reform. But, change often comes slowly—and in the wake of Medicare’s recently issued proposed physician fee schedule for 2017 , I have to wonder whether it’ll come too slowly for physical and occupational therapists. That’s because, while the Centers for Medicare & Medicaid Services (CMS) voiced its support for replacing the existing CPT codes for physical …

  • The Bundle Conundrum: Should PTs Participate in CJR? Image

    articleNov 9, 2016 | 6 min. read

    The Bundle Conundrum: Should PTs Participate in CJR?

    There a lot of hot topics in health care right now. Among top trending terms like “Affordable Care Act,” “pay-for-performance,” and “value-based care,” you’ve also probably heard “Medicare bundled payments”—specifically, “CJR” (or Comprehensive Care for Joint Replacement ). It’s a new bundled payment model from CMS, and it is of particular importance to outpatient rehab providers. As this article explains, “CJR will support better care for patients who are undergoing elective hip and knee replacement surgeries—the two …

  • Founder Letter: My Evaluation of the New PT and OT Eval Codes Image

    articleNov 3, 2016 | 5 min. read

    Founder Letter: My Evaluation of the New PT and OT Eval Codes

    Over the last several years, healthcare providers in general—and rehab therapists, specifically—have been hit with a seemingly constant barrage of regulatory requirements. And the vast majority of these initiatives—PQRS, functional limitation reporting, MPPR, ICD-10, and the like—have either: Had a direct negative impact on our payments, or Forced us to devote extra time to satisfying the criteria of the requirements—with zero compensation for that time. So, it should come as no surprise that the rehab therapy community …

  • Payment Reform is Coming: What PTs Must do to Prepare Image

    articleMay 26, 2015 | 5 min. read

    Payment Reform is Coming: What PTs Must do to Prepare

    When it comes to payment reform, the wheels of change are already in motion—and as you’ve learned in this post on payment models and this one on the proposed PT payment system overhaul, there’s no stopping this train. But forward motion is typically a sign of progress, and that certainly holds true in this case. Because by aligning themselves with the push to reform payment structures and processes to better align with the so-called triple aim—that is, …

  • Founder Letter: PQRS is Dead, But Your Data-Analysis Efforts Should Live On Image

    articleDec 6, 2016 | 6 min. read

    Founder Letter: PQRS is Dead, But Your Data-Analysis Efforts Should Live On

    If there’s one thing I know about rehab therapists, it’s that we are all very busy people. If your to-do list is anything like mine, it’s growing faster than you can prune it—and has probably expanded onto multiple sheets of paper (or maybe even into multiple notebooks). And regardless of the value associated with each item on the docket, we tend to refer to these tasks as things we “have” to do—not things we “get” to do. …

Achieve greatness in practice with the ultimate EMR for PTs, OTs, and SLPs.