The Financial Cycle
Jan 07, 2023Hi, this is Dave Kats with Therapist Consultants. I have a tip for you. Did you know that most therapists go through a financial cycle when they first open their business, are not on any insurance panels, so they charge a cash basis. They charge on a cash basis. They usually charge a little bit less and then they do their cash. Well, eventually after about six months, they say, "Hey, I'm missing a lot of new patients because I don't accept insurance."
They get on these insurance panels and then they have an insurance practice. Well, after a year, or two, or three or four or five, they say, "Well, I'm not making nearly as much in insurance as I would if I was a cash practice." They revert back to a cash practice but then at a higher level. The ultimate goal is to have an all cash and all self-pay practice with no discounts at your regular rate. That's the goal that you want to get you. You can get fixated on either of those goals.
Some people say cash or low level. Some people stay insurance all their life. Some people go back again, finally they get to the place where they're charging full price and have a self-pay practice. By the way, if you have associates, why don't you move to a self-pay practice right now and take only self-pay people and have your associates take the insurance people? They'll be glad to have the opportunity to do that and you'll be glad to make the money do a self-pay and all your patients will be served equally.
This is Dave Kats. Thanks for listening.
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