Cash Vs Insurance Practice

Hi, this is Dave Kats with Therapist Consultants and I have a tip for you. Did you know that most therapists go through a financial cycle when they first open their business or not on any insurance panels, so they charge a cash basis. They charge on a cash basis, and 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. So 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, wow, I'm not making nearly as much on insurance as I would if I was a cash practice. And so they revert back to a cash practice, but then at a higher level. Now, the ultimate goal is to have an all cash or an all self-pay practice with no discounts at your regular rate. That's the goal that you want to get to. But you can get fixated on any of those goals. Some people stay cash at a low level. Some people stay with insurance all their life.

Some people go back and finally 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-paying 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 you do as self-pay and all of your patients will be served equally. This is Dave Kats, thanks for listening.