5 fundamental benchmark metrics for physical therapy private practices

The primary financial purpose of running a private practice is the generation of profit, yet many private practice physical therapists miss the boat when it comes to achieving profitability with their business.

When running a physical therapy private practice there are certain rules of thumb that professionals should be using to determine how well the practice is performing, says P. Christopher Music, author of What Every Private Practice Physical Therapist Needs to Know About His or Her Financial Future and President of Wealth Advisory Associates. Music recently collaborated with Shaun Kirk, PT, to develop 5 fundamental metrics to measure the productivity and profitability of a private practice.

Music says that a well run physical therapy private practice should be taking home at least one-third of the gross income annually. To achieve this fundamental, Music relates it to taking advantage of resources that offer a proven business management system instead of using a haphazard approach.

The second fundamental is reducing the cancellation rate of patients which is the greatest area of loss according to Music. Private practice physical therapists should have a cancellation rate of less than 15 percent. Music provides a specialized method for physical therapists to improve the number of kept appointments each week.

According to P. Christopher Music, a high percentage of private practice physical therapists pay their staff well and then deprive themselves of the fruits of private practice ownership. As the third fundamental he says the bottom line is this: No more than 45 percent of the gross income should be going to employee salaries.

The fourth fundamental Music says is an efficient well-organized practice that operates at a 1-to-1 ratio which is one clinical person and one administrative person. The practice should also be generating approximately $2500 per week per clinical staff member. He proceeds to explain the method for achieving this to help physical therapists get a handle on this aspect of the private practice.

Fifth, weekly patient visits should roughly equal the total square feet of office space divided by ten. Music teaches private practice physical therapists how to meet this quota by sharing with them sources of effective marketing techniques for increasing patient visits.

Music emphasizes that a private practice should be prosperous for professionals - if the practice doesn’t work for the physical therapist then they end up working for the practice and it eventually consumes them if not controlled.

After 18-plus years of being a financial planner, P. Christopher Music decided there had to be a better way. Witnessing financial debacles of big industry and government-driven economies caused Christopher to take action, developing an instrument that measures the success of any financial plan. The Financial Prosperity IndexTM (FPI) is the back bone of Music’s firm, Wealth Advisory Associates (WAA). WAA is a financial planning firm focused on helping private-practice physical therapists understand and implement the most effective strategies to achieving financial success and security. With rampant misinformation and immorality on the subject of money in today’s world, Mr. Music’s system has been described as “easy to understand,” allowing a professional to do what he does best – his profession. Visit www.wealthadvisoryassociates.com

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