Assessing Your Physical Therapy Practice: Do You Know What You Don’t Know?

31 May 2016

We continually have the opportunity to meet and interact with physician practice administrators and physical therapy clinic directors from all over the country.  A common phrase we often hear when the conversation turns to their therapy clinic’s performance is, “We THINK we’re doing OK, but we don’t really know what we don’t know”.  Today, we’ll review some of the key parameters we measure and why you should, too.


Most therapy facilities have some mechanism(s) they use to measure key operational metrics, e.g. visits per new patient, units of service per visit, cancel rate, capture rate, and visits per FTE.  It’s one thing to capture the info; it’s another thing entirely to understand what the data is telling you.  As we review some of these metrics below, consider how your practice is performing in these areas and how you could be doing better.

  • Visits per New Patient – This is one of the most important metrics we measure as it gives us an idea as to the degree to which patients are completing their prescribed course of care. We also view it as an indicator as to the patient’s perception of the value of the care they are receiving.  This will also be a focus as more payers embrace bundled payment models.
  • Units of Service per Visit – This metric gives us an idea as to how much time therapists are spending with their patients, the comprehensiveness of treatment, and the degree to which they are managing their billable time. It can also help in determining if therapists could benefit from additional education in the use of evidence-based codes, the difference between Medicare’s 8-minute rule and the AMA’s guidance on timed codes, etc.
  • Cancel rate – While there can be several factors that impact a facility’s cancel rate, this metric can be viewed as an indicator of patient perception. A high cancel rate may be indicative of patients not perceiving value in their therapy sessions and therefore not making attendance a priority.
  • Capture rate – The facility’s conversion of referrals to new patients should be assessed to ensure patients are not slipping through the cracks. If patients are not showing for their initial visit upon referral to physical therapy, it is important to have formal case management processes in place to follow up with these individuals to make sure they are compliant with the physician’s orders.
  • Visits per FTE – There are a number of different productivity measures which clinics use to determine the overall productivity of their staff. One of the simplest ways to assess the efficiency of the clinic’s operations is to track visits per clinical FTE.  While often viewed as an indicator to ensure therapists are maximizing their available schedule times, it is equally useful as a metric to assist in determining if therapists are seeing TOO MANY patients and if staffing ratios need to be adjusted to accommodate the patient load or if additional staff needs to be hired in order to balance efficiency and the delivery of quality care.

While these variables have commonly been used to assess clinic operations for some time now, providers and managers must be preparing to view operational metrics in a different light as payment models shift from traditional fee-for-service to value-based reimbursement.  It will be essential for clinicians to focus on the utilization of best practices in delivering efficient, low-cost care which provides the best possible outcomes.


We recently concluded a three-part blog series on clinical outcomes in which we reviewed the importance outcomes will play in alternative payment models as well as the components of outcome measure tracking including patient perception questionnaires, patient-reported outcome measures (PROMs), and industry-standard assessment tools.

We know that outcomes will be playing an increasingly important role as healthcare moves towards pay-for-performance and outcome-based payment models.  However, the importance of tracking meaningful clinical outcomes extends well beyond the need to provide payers with outcome data.  Outcomes can play a key role in the day-to-day management of the clinic.  Therapy providers can grow weary of operational metrics as an indicator of their performance and often begin to “tune out” discussions about “the numbers”.  Clinical outcomes, however, are usually more relevant to clinicians but still have a direct impact on the operational metrics.

Is your practice currently capturing clinical outcome data?  If so, how are you utilizing that information to improve the patient experience, to help your therapists assess their effectiveness, and to make improvements to the delivery of care?


The follow-up on therapy claims can be a challenging in itself as payers often have different billing and documentation requirements.  Questions to consider when reviewing your therapy claims and denials may include:

  • Do your therapists understand how to properly code for services rendered?
  • Is your therapy clinic accurately tracking Medicare therapy cap amounts and appropriately applying KX modifiers?
  • Do your therapists understand when it is appropriate to offer Medicare beneficiaries an ABN?
  • Are your therapists documenting to support medical necessity requirements?
  • Does your therapists’ documentation indicate the skilled nature of the services provided?
  • Are your therapists meeting the documentation requirements and reporting the necessary codes for PQRS and functional limitation reporting?
  • Are your therapy claims being processed with the appropriate modifiers?

Failure to address the issues above can hold up the processing of therapy claims and lead to denials and/or reduced payments.


Many practice administrators have indicated that they often find themselves overwhelmed with the regulatory changes affecting physical therapy as these are often different or entirely separate from initiatives they must adjust to on the physician side.  Within the last few years alone, therapists have found themselves struggling to keep up with changes to payer documentation requirements, PQRS, functional limitation reporting, therapy caps, etc.  In the coming years, therapists must once again adjust to new quality reporting requirements as the Merit-Based Incentive Payment System (MIPS) comes into play.  It is important to stay on top of these developments in order to make necessary modifications to operations and assist your therapy team in learning how to adapt to the changes.


To learn more about how Integrity Rehab Group can help answer these questions and more, check out our website at  For those who are attending AAOE in San Francisco, please visit us at Booth #305 or drop by our Fast Track sessions on Friday, June 10 from 2:00 – 3:05 pm in Franciscan C. The Fast Track topic is titled: “When it comes to physical therapy, do you know what you don’t know?”  Hope to see you there!

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