When someone asks what you do, how you respond as a physical therapy practice owner matters for the potential growth of your business.
Brian Gallagher, PT, founder and president of MEG, says transitioning from a licensed professional who thinks like an employee to a business owner who thinks like an employer takes conscious effort and business training.
“When someone asks about your work, you should say you’re the CEO of your therapy company, who happens to be a therapist, rather than you’re a physical therapist who happens to own a clinic,” says Gallagher.
As a coach for physical therapy business owners, Gallagher works with two types of owner mindsets. One is satisfied building a small practice, using external contractors to fill needs like scheduling and accounting.
The other hopes to expand to multiple locations with a few employees. The success of both require shifting your mindset from a clinician to becoming a CEO. “Your mindset has to shift so that your greater responsibility is that of a CEO, the owner and founder, instead of that of a clinician,” says Gallagher.
Growing beyond the clinician mindset to build PT systems that scale
Gallagher knows firsthand the importance of the business owner mindset after starting a PT practice with his wife, building it up to two clinics and then going into debt because he didn’t know how to be a business owner.
He took a break to learn from his mistakes and reopened a thriving PT practice with six clinics, nursing home contracts, staffing contracts and 160 employees. It was worth $3.3 million dollars at the time he sold it.
“A company begins when you have three or more people. When it’s just 1-2 people, it’s a rewarding self-employment environment. More employees means assembling them for a common purpose and goal,” says Gallagher.
Growing beyond the clinician mindset to become a business owner requires systems that scale.
Whether you’re building a small physical therapy practice with only a few employees or looking to open several clinics, setting up systems will help you build a successful practice.
Key components of scalable systems for your PT practice
When you’re growing your physical therapy practice beyond the solo practitioner level, it’s tempting to think that identifying the next best therapist, software or technology is what you need to succeed. Instead, says Gallagher, you need to focus from the start on developing four general areas of business:
- Environment
- Structure
- Personnel
- Systems of operation
The following explains these areas of business.
Selecting the ideal business environment
Determine the optimal clinic size:
Aim for an office space between 1,500 to 2,500 square feet. “Two thousand square feet is the sweet spot for a PT practice. This size allows for efficient operations and accommodates necessary equipment and staff,” says Gallagher.
Location:
Choose a location with high traffic visibility, which Gallagher defines as at least 10,000-20,000 cars per day. You’ll also want easy ingress and egress access for clients. This increases the potential for attracting new patients.
Determine your organizational structure
Creating a structured organization is the secret to scalability, says Gallagher. “If you have the right structure, you can go from one office to even 20 offices.”
A structured organization involves setting up five key divisions within your practice. Ideally, you’ll hire employees or outsource these divisions to contractors. “In the beginning stages, you will wear multiple hats, but you will start shedding those hats as you grow,” says Gallagher.
The following are the five divisions for your organizational structure:
- Administration: This division handles day-to-day operations, human resources and overall office management. Gallagher recommends outsourcing front desk operations to reduce your management burden.
- Marketing and sales: This division builds brand awareness and attracts new clients.
- Finance: This division manages billing, accounting and financial planning. Outsourcing billing can streamline processes and reduce overhead costs.
- Production: This division is the service you produce –– your physical therapy clinical services. To ensure high-quality patient care and efficient service, hire and train competent therapists and support staff to deliver clinical excellence even as your PT practice grows.
- Quality and executive leadership: This division oversees strategic planning, quality assurance and leadership development by setting clear goals and metrics across all divisions. As a sole provider, executive leadership means “working on your business instead of in your business,” says Gallagher.
“Once you have these five divisions and can identify who’s at the top of each and measure their product, you could scale without reinventing the wheel,” says Gallagher. “You simply keep adding more to the foundation of your business.”
Attract the right employees
To attract and retain the best employees, says Gallagher, “You have to show them that you have the confidence, knowledge and certainty about how to run a business, and that starts with your structure.”
Once your organizational structure is in place, you have to create a supportive work environment and invest in employee development. This is especially true with healthcare’s dual staffing shortages and burnout crises. “A strong, supportive culture will help attract and retain top talent, which is essential for scaling operations,” says Gallagher.
Many physical therapists who start a practice have years of experience managing other PTs. When hiring PTs for your own business, Gallagher recommends finding those whose goals align with your practice culture and mission.
As you grow your PT practice and hire additional employees, you’ll want to notify your insurance broker of these changes in case they affect your level of risk.
Setting up successful systems of operation
Whether you work as a solo provider delivering at-home therapy or you own several clinics, setting up standard operating procedures (SOPs) will save you time and make your business more successful.
Comprehensive SOPs should include all aspects of your practice, from patient intake to billing. Gallagher recommends leaning on experts by outsourcing many of these areas of business. Gallagher calls this a progressive PT private practice model where external companies manage tasks like credentialing, billing and scheduling.
Successfully scaling your physical therapy practice requires a strategic mindset shift from clinician to business leader. By following Gallagher’s guidelines, physical therapists can confidently transition from solo practitioners to thriving business owners, delivering exceptional care and achieving financial success.
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