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The Ins And Outs Of Building An Out-Of-Network Practice with Dr. Aaron LeBauer, Host of The CashPT Lunch Hour Podcast
I am lucky enough to have a fellow podcaster, Aaron LeBauer, physical therapist and host of The CashPT Lunch Hour Podcast and the Founder of the CashPT Nation Facebook Group. Aaron has been not only successful in developing cash based out of network clinic in Greensboro, North Carolina but has also helped thousands of other passionate physical therapists build successful businesses, without relying on insurance. Aaron is one of my first out of network/cash-based physical therapy owners that I’ve had the opportunity to interview on the show. I also interviewed Kim Rondina. She is also running, owning, practicing in an out of network practice in Arizona after spending years as a physical therapist administrator in a large in-network facility. She’s struck out on her own and we talked in her show about something else.
I’ve got Aaron and he’s going to talk to us a little bit about the ins and outs of being out of network. Aaron went straight from school into an out of network clinic that he owned and operated. He’s got a ton of experience doing that over the past ten years. This goes in line with Aaron’s mission, all that he’s done and the practice itself. That is to save 100 million people worldwide from unnecessary surgery by inspiring other healthcare providers, to start their own businesses and then learn how to market directly to patients and not physicians. Aaron has an influence as cash-based out of network expert. I’m excited to bring that to you so that he can inspire you with the different aspects, the ways that he had to build his business and be successful without going the traditional route. Hopefully, whether you’re going into an out of network practice or thinking about that or not, he can inspire you with some of the wisdom that he shares.
I’ve got Aaron LeBauer of Greensboro, North Carolina and he is also a podcast host. He hosts The CashPT Lunch Hour. I’m excited I have him on because I never had another podcast host on with me. I’m excited because Aaron is all about cash-based PT practices and he’s been successful in his own. First of all, thanks for coming on, Aaron. I appreciate it.
Nathan, thanks for having me. It’s an honor to be here.
Tell us a little bit about you. I don’t have a lot of exposure to cash-based practice. I know it’s intriguing, it’s out there and it’s gaining momentum. Tell us a little bit about your professional path and where you’re at.
My father is a cardiologist. My uncle was a pulmonary specialist and another uncle was a gastroenterologist. My grandfather was a family practice physician and his brother was a general surgeon. I come from not only just a line of healers but medical providers. I was supposed to be a physician or a doctor. I use the term doctor in a very specific way because physical therapists were also a doctoring profession. I was supposed to be a physician. At the first night of organic chemistry, I was like, “I’ve got an A in regular chemistry and this going to take me four hours to do the first night of review. I sat there for about two hours. I’m not going to do it. It’s not worth it.” It’s not worth doing four to six hours of homework a day, to do something I don’t have a passion for, which is working 100 hours a week. I’m not seeing my kids and not be wanting to do all these other things that I saw that my dad wasn’t doing. I was like, “I’ll find another way.”
I graduated college from Duke University and I went out to California. I was like, “I’m going to get a “real job.”” I landed in California so I’m looking for jobs at places like PowerBar, The North Face and Sierra Designs. I got an interview at Sports Street Marketing, which they make the goo product. I show up and I’m wearing my suit and they’re like, “We don’t dress that formally here.” I was like, “You wear a suit at interviews.” The next company I got an interview at, I wore a sweater and I got called back and figured that was a good sign. That was in Sierra Designs and they couldn’t hire me to answer the phones. From college grad, what about it was I couldn’t get hired to answer the phones. I became a temp, then after doing that for a while and being treated like I was illiterate, I became a bike messenger.
One of my passions in life was racing bicycles. I couldn’t figure out how to race bikes so working on the bike is the next best thing. At my first full paycheck, I made $1,200, which was more than my dispatcher made in his first full years of bike messenger. I already knew how to ride I just didn’t know where I was going. I was doing that and I want to sustain. It wanted a long-term sustainable thing. In the back of my mind, I was trying to figure out how do I race bikes and earn a living. I had been exposed through a yoga class in college just massage and through my mom. Getting me a massage when my legs were hurting one summer. I didn’t race bikes in high school and college. My legs hurt and that helped. She was like, “You should go do something with your hands. Do massage therapy. Look into it at least for us.” I was heading one of these epiphanies after a long day of riding a bike. I was like, “I can go do massage, where I see four people a day and make $40 an hour or if I’m my own practice, I can charge $75 an hour. I can race my bike.”
I went to massage school and that’s what I did. I raced my bike and I became a category one amateur cyclists, which is the top level on amateur program cycling in the United States. I did that for a while. My wife, my girlfriend at the time encouraged me to go to PT school. I was doing the type of massage. I was specializing in a myofascial release and some other therapies, where I ended up seeing a lot of chronic pain patients because I was touching them where they hurt. They had been to PT, chiropractic, acupuncture, massage, medications, injection, surgery, etc. They’re like, “Aaron, you’re the first person to ever touched me where I hurt.” That was so simple to me. It’s like, “Okay, great.” After doing that for six years, my wife was like, “You should go to PT school.” PT was never on my radar. She encouraged me to do it. It wasn’t going to happen in California because of all the prerequisites required to get to the end of the schools near the Bay Area.
It was going to take me two years of prerequisite. We moved back to North Carolina for a lot of other reasons. We hit our limit in California. Instead of throwing a dart at the map, we tried near where her family lives on the Central Coast and we’re like, “No, that was a nice vacation, but we got to go somewhere else.” Instead of landing in Kansas or Iowa, we decided to go to Greensboro where I grew up and see how that worked out. Within six months of moving back here, we were both reenrolled in school. We owned a home and we each had a business. I opened my massage therapy business again, I was enrolled in PT school at Elon and then I graduated school.You can't charge little and expect to invest in your own business and grow if you're not charging a real amount. Click To Tweet
Here’s what happened. Here’s what I got into cash-based practice. In school at my very first clinical rotation, it was busy. I had to be there for 50 hours a week. I was like, “Who’s going to complain? My dad had to do 150 hours a week.” He’d fall asleep right at signing his name. I was like, “I knew this.” I was like, “This is easy. Fifty hours is no big deal.” I was there from 8:00 to 9:00. One day, it was 9:15 at night. I’m sitting there with sixteen more treatment notes and I’m like, “This is crazy. How many people I’ve seen today?” Forty-three patients, it was my third week as a student. I had 43 patients in one day. I was like, “This is crazy. This is great and all but I can’t do this in my career. I can’t see this many people.”
I don’t know what I’m going to do, but I can’t do it like that. I’m coming from a massage background. We spend an hour and a half with people. Ten minutes of hands-on with one person, while I’m directing someone else’s exercises across the room wasn’t satisfying to me. It wasn’t why I got into PT. That’s the big thing that started LeBauer. The rest is history. I started my clinic right after I graduated PT school. I’ve never worked for another physical therapist for a paycheck.
What’s cool about your story is you come from the massage therapy background, where you’re working with patients for an hour at a time. I’m very comfortable with that. You knew how to work out and had some entrepreneurial experience going into it as well. Graduating, I’m sure you felt very confident that you could do this and be successful.
Yes and no. In massage therapy school, it was yearlong. We had two kinds of semesters. It was Western massage and Eastern massage. Each one had its own business component. I did more business in massage school than I did in PT. They were encouraging you to like, “You’re going to go out and start your own business.” Maybe you could work for a chiropractor or work in a spa, but that’s not how to make a living and being a massage therapist. You need to do this. I get to PT school and there wasn’t any of that. It was to get a loan for a quarter million dollars or have 5,000 square foot facility. When it came to my group’s project, we’re like, “Yeah, but we don’t want to do that. Can we do this?” Then the professors were like, “Nope, you’ve got to do this.” We designed our facility and rented out 80% of it. Target can have the other 80% and they didn’t like that. They didn’t like the creativity too much.
When I was telling everyone that this is one we’re doing, you would think I felt confident doing it. Everyone said, “No, it’s not possible.” My clinical instructor on my first affiliation even told me, “No, one’s going to pay more than they pay for a PT. It’s unethical to charge cash for physical therapy. You can’t do it. It’s not possible. People won’t pay.” Some people said it. I was sitting there going, “I’m Dr. LeBauer, I can charge $10 more an hour. People will pay $10 more an hour now that I’m Dr. LeBauer.” Most people were like, “No, you’re crazy. It’s not going to work.” I was like, “It’s got to work. People were paying me $85 and I was Aaron the massage therapist. Now I’m Dr. LeBauer the physical therapist.” They did but I wasn’t very confident going into it because there weren’t people saying, “Yeah, you can do that.”
Kudos to you because you heard all the naysayers. I’m sure that you took a little hit to your goals that you might have had like, “I can do this,” and everyone kept telling you, “No, you can’t do that.” I hate to hear that they say it was unethical. That just gets me in the crawl. Tell me how did it go. You open up your doors. Tell me about the first year or first two years.
It went good. At the first week, I had six or seven patients and people say, “You were doing massage before.” I was out of state on the other side of the country for six months. I had a month of school and then a month of taking the licensure exams. For eight months, I was gone. My business has ended and I did have a list of people to call. It still took me two years to consistently see fifteen to eighteen people a week. It took me two years. It was a lot of work. It took a lot of trial and error.
What was your marketing? Are you marketing to physicians and whatnot during this time? How does that go?
That was what everyone told me I needed to do. I tried it but it didn’t work out too well. People say, “What’s the number one mistake?” I would say, “Marketing physicians.” “You can’t talk bad about physicians.” I was like, “Physicians aren’t my customer. Patients are my customer. Physicians don’t understand.” Anyone they send to me is expecting like, “I just went to see God of the universe. Why am I going to pay the technician three times as much?” When patients come to see me, the physicians are the decision maker. They come to see me for the technical work. They didn’t come to see me for the decision-making process. That didn’t work out well. It took me a long time to tell the story on my webinars, but I’m pretty connected here in Greensboro with a bunch of physicians.
My dad is like, “Go and meet so and so and they’ll help send your patients.” I’m like, “I don’t know, dad.” He’s like, “They will do it.” I’m like, “Okay.” This one primary care physician meets with me on a Saturday for two hours and he’s the kind of guy who comes to your house when you have pneumonia. He’s also the guy that his partners had to wait until he was out of town before they voted not to accept any more new Medicare patients. He was gone because he knew that they would vote against it. He was like, “Call Jane. She’ll set up a time to meet with the other partners.” I called her, she said other time, six weeks from now. Two days before she’s like, “I’m just calling to make sure that you’re bringing in lunch for 65 people.” I was like, “No, that wasn’t part of our agreement.” She’s like, “That’s how we do it here.” I said, “I don’t know that it would be that ethical for me to come and buy everyone lunch to meet just for the opportunity to meet with some colleagues.”
She’s like, “Then we’re going to have to reschedule.” This is the building with my grandfather’s name on it. I can pay to play but I don’t feel that it’s not a good return on my investment too. I don’t feel like I should have to because I shouldn’t have to. Maybe I’m isolated in that case. I grew up with the mentality of I’m a primary care provider because that’s all I got downloaded from my dad and my uncles. I shouldn’t have to pay to go meet them and talk about our mutual patients. I don’t want to say unethical. That’s little strong balance but that’s unnecessary. The goal is to help people. I shouldn’t have to buy lunch. I wouldn’t pay $1,000 in lunch when I don’t have a marketing budget. I’m not Merck and Pfizer, the money that is dumped off and the waste money is more money than I have.
What did you learn from that then? How do you market? I love your fresh perspective because I think a lot of us get into these ruts like, “This is how it’s been done and this is what we need to do in order to be successful.” There are plenty of people who I’ve talked to on my show who say, “You need to have relationships with the doctors.” When you talk about relationships with physicians, you’re thinking, “I’ve got to get lunch if I’m going to meet with this guy.” I love how you say, “Why would I have to buy lunch if we’re talking about a mutual patient? You’re my colleague, not my parent.” What did you do then? You took your marketing to a different area. I assume you’re maybe direct to consumer more.
When I step back and realize, I was like, “Who am I marketing to? Who do I want to come and see me?” If people have been referred by physicians even because of convenience, they’re not the right people. I had to go back old school like Dan Kennedy’s style. I’ve got to create this message that resonates with the people I want to be seen in my practice. I’ve been doing some of this doing massage, but it was a very different message. Massage is an elective bonus type of service and physical therapy is something that people need. It’s a medical service. I got to get directly in front of them. I started doing it using my website. I was getting, “I heard about you from.” It’s a word of mouth. I can’t let word of mouth build on. I have to cultivate it. I cultivate it using email marketing, my website, and Google was helpful for me. Google is my number one referral source. Larry and Sergey are my biggest fans and they don’t even know it.
How long ago was this?
A few years ago.
You’ve been at it for a while. You leveraged Google at the time and your website to drive patients to you. Is that the same thing you’re doing or is your marketing similar to what you were doing a few years ago?It doesn't matter what you charge as long as it's a reasonable value. Click To Tweet
Yes, it’s similar and it’s more refined. At the time, search engine optimization was a big thing being directory listening. I’d spend nights with my first baby in one arm, my right hand on the mouse finding all the directory listings online that I could find and putting in our clinic location. That’s not something that will work but at the time, the more places you are found online with your website in your location, the better. Our website was one that wasn’t within a brochure. It was more speaking to patients and I have a little place on there where you can get my book on back pain and download it. I could just send emails after. I was using email marketing and websites as well as getting in front of people I knew, doing some talks in groups and some workshops. We’ve refined it so the system works better and faster. One of my students, Derek, moved to a brand-new town that he had no connections there. Within six months of seeing fifteen people a week, it took him six months to do what it took me two years.
Tell me a little bit about the talking, the speaking that you’re doing and how that helped out the workshops. How did you advertise? Did you focus on certain topics? Where did you hold them and whatnot?
Everyone has got back pain. I just focused on back pain. I like doing yoga. I raced bikes so I got a speaking gig in the triathlon group with the cycling group and at one of the yoga studios, between the combination of doing those things. Over the years, I’m getting better and better. What we do is we’ll go, talk and teach people what the problem is. Why they need to do something about it and how to identify if they have a problem. Maybe one or two things they can do at home. It’s a way of, “You’ve got to try this at home. If it feels better, that’s great, then we know where your problem is. If it doesn’t change anything, then you also need to be seen because it’s not your back that’s the problem. It’s somewhere else,” versus, “It didn’t work. Physical therapy didn’t work. I tried these exercises I found on YouTube and it just doesn’t work.”
It’s not that the physical therapy didn’t work. It’s like, “We’re not putting it in the right place.” You need a prescription. Physical therapy is not a modality. It’s a decision-making process. Anyone can learn exercises. It takes you or me to be able to look at someone and say, “This is where we need to put the exercise and this is how much for this. You need to put a ball, a cane or a roller and how much. This is where you put your hands, how much and how long.” We educate people about that and what I’ll do is say, “If you want the handouts and a special video I made for you, be sure you sign into the workshop and give me your name, phone number, and email. I’ll send it out to you later tonight.” I’ve got them on my email list and follow up them on the phone, emails, etc.
How do you transition them? I’m sure a lot of them may have been through a traditional physical therapy where they didn’t have to pay cash out of pocket. How do you transition? What’s your conversation like to tell them, “I don’t take insurance?”
We try to make the whole thing about their why, rather than their logical questions because people make additional decisions. We’re trying to stay away from the logical part. Most people when they call a medical provider, what do you think are the first two or the first three questions are asked?
“What’s your insurance? Who’s your doctor?”
“Who’s your doctor? What’s your insurance and date of birth?” They never ask your name and how you’re doing. I always even asked, “What doctor you’re here for?” I said, “I’m not here for my doctor. I’m here for myself.” She looked at me like I was the biggest jerk and I was just like, “You asked me what doctor am I here for. I’m not here for the doctor. I’m here for me. My name is Aaron.” That’s one of my biggest pet peeves these days. They don’t introduce themselves by name. They don’t call me by name. Even if they know my name, they’re not even like, “Mr. LeBauer.” I don’t even get the chance to correct my name, “It’s Dr. LeBauer.” With my kids, it’s like, “Daddy.” I’m like, “I’m not Daddy.” My kid’s last name is LeBauer just to say Mr. LeBauer or ask if you are unsure. That’s number one. We don’t talk to people about insurance and date of birth. We’re talking about, “I’m a real human. I’m going to ask your name if they didn’t tell us. My name is this. What’s going on that you’re calling us for physical therapy? Why is this a problem in your life? Why is it so important that you do something about this now versus six weeks ago? What would you like to have happened as a result of working together with us?”
Is this something that the physical therapist is doing on the phone? Do you have some team members that are doing this on your behalf at the initial call?
We do a couple of different things, where we’ll have people fill out a form on our website to apply to speak to a PT first. They’ll fill out a similar application to get some information about pricing and availability or come in for a free total body diagnostic. We’ll get some of those questions online and then we’ll ask them on the phone. Sometimes when it was just me, I was asking these questions on the phone. Amber, our customer care specialist will be the first person to call people back, but people can apply for a call with Dr. Shelton and they’ll call and ask.
The physical therapist will always ask similar or the same questions during our evaluation or one of our free sessions. It’s the same questions. There are five different ways to solve your pain. You can get it out of a bottle. You can get off a brace, tape, crane, injection, opioid, and surgery or whatever else. You can get a foot insert for your neck problem. Why here, why us, why now? What’s your motivation? When we find out that information, which number one, no one else is asking it and number two, get people’s buy-in because they start to understand why it’s important to them.
I know you do some coaching and consulting. What we’re talking about here, the questions that you ask on the patients at the very beginning, that would seem to me like an integral part about your success altogether. Do you find that? What’s the secret to your success as a CashPT practice?
This is important and the secret is being willing to not stop when you encounter some difficulty.
Tell me about that. What do you mean by difficulty?
I want to start a practice because it allows me to see patients for an hour without insurance telling me that they won’t pay. Then everyone comes to this, “No, you can’t do it. It’s unethical.” I’m like, “I’ve got to figure out a way to do it.” Then someone says, “You cannot see Medicare patients.” I’m like, “What do you mean I can’t see Medicare patients?” I’ve got to go figure out how do I do this. If physicians are going to send me patients, let me go figure out a creative way to market directly to patients. People are objecting to the price. I’m like, “Let me figure out why are they objecting.” What makes people successful? What makes the business owner successful is being unwilling to take no for an answer to get what they want. If you’re someone who is going to roll over at the first sign of difficulty, then owning a business is not for you.
It’s a huge insight for everybody because your perspectives are just off of the traditional mindset of physical therapy owner. For you to look at the supposed obstacles and say, “Why not? Why can’t I?” is great. I’m sure it’s a testament to why you’re successful. The questions that you ask the patients, even in a traditional setting, those are valuable questions. They’re not limited to a cash-based practice. Getting in that kind of mindset for any physical therapists to be successful at treating a patient through their entire plan of care is important to get to the heart of those questions. Why are you here today? Why now? What is this going to look like if you don’t treat it now and what are your real goals? You want your knee to get better, but you need to get better for what reason? You want to play with your grandkids. If you play with your grandkids, you’re also going to have to lift, squat, maybe kneel and get down to the ground. There’s more to it than just bending your knee a little bit more and leaving some pain. Those questions are huge. As you’re coaching consulting, do you also spend some time helping people go through that process asking questions? I look at it as our sales technique. It’s not what you would call traditional sales, but it is the sales of a physical therapist.For one reason or another, people end up doing things because of time and efficiency. Click To Tweet
I do that and I’ve created a whole brand-new course just for that purpose because I found that there was this big gap for people who are like, “You’re only charging $75 a visit.” You can’t charge that little, expect to invest in your own business and grow if you’re not charging a real amount. That’s what I was charging because that’s what we charge at the clinic I worked in or that’s what people’s copays are. That’s what Susie down the street has twenty years of experience in PT is charging her people because she doesn’t know business doesn’t mean you should have all your business off someone who doesn’t have a business. I’m like, “There’s this gap between people come in and they want to help patients.” In order to help patients, we have to learn how to sell physical therapy. You’ve got to sell your plan of care. You can’t help someone if they need eight visits and you come in for three.
If in network clinics, we’re taking the time to be as efficient in the sales process as we are, they’d be crushing it. No one would complain about a $50 copay. I have people who don’t complain. Our patients pay $250 a visit. Everyone says to me, “I can’t give you or pay a $50 copay.” I’m like, “I don’t know if I can help you.” I can, but if you can do what I do to sell $250 and you only have to sell $50, you should be crushing it because the barrier to entry is so low because you take their insurance. Why is that a problem? I feel bad about selling a service that either A) I’m not convinced it’s going to work, B) I don’t think it’s going to work for you, or C) I don’t believe in myself. A physical therapist shouldn’t have any of those objections. I wouldn’t ever tell anyone come here for eight visits when I didn’t believe they needed it. It’s a disconnect because you get out of PT school and you don’t know anything about sales or influencing people to make a decision.
$250 a visit is amazing, first off. I was expecting maybe something over a $100, but $250 blows me out of the water and that’s great. There’s going to be some concern from the patient when they hear that amount, am I wrong? How do you overcome that?
What we do is with the questions that we ask, it’s like the visa commercial. It’s like a $50 steak, $250 watch, $500 limousine, date with your wife, priceless. It’s like, “If I can get to the priceless thing and/or $2,000 worth of PT, $2,000 is no big deal.” I had a conversation with a woman who was an occupational therapist and a CrossFit coach. I was trying to explain it. I was like, “Why is CrossFit so important to you?” She’s like, “Because I feel strong.” I’m like, “Why is feeling strong important to you?” She’s like, “Because as a woman, I want to feel strong and capable of doing anything that I want.” I’m like, “Why is being strong and capable of doing anything you want so important to you?” She’s like, “So that if I needed to, I could run across the parking lot there and jump over that fence.” I’m like, “Why is that?” She’s like, “Because I want to be in.”
I’m like, “If you are missing that for three to six months, if you are no longer able to feel strong and capable of running away and jumping over the fence and being as strong as possible and I told you in just five to six weeks, I can get you back to being able to do that. Would you pay $2,000 for that?” She said yes. I got to know that thing. I know that it doesn’t matter what I charge as long as it’s a reasonable value. If value of this is priceless, it’s tens of thousands of dollars, we’re just going to go 10% of that value. It’s totally okay with it. Then it’s like, “Ms. Jones, we’re going to get you started once a week for eight weeks.” She’s like, “I don’t know. I don’t have that much on my health savings card.” I’m like, “No problem. We can pay as you go or if you want to do a no interest payment plan, we’d be happy to do that. If you want to save $100, you pay in full today and save $100.”
I’ve got a ton of questions, but we’ve got limited time and I want you to share all the secrets. How do you then take those patients and convince them that your place is better than going to an in-network facility?
We don’t, they just know. 30% to 40% of our patients have been somewhere else and they haven’t got a resolution where they’re like, “All they did was show me how to do things I could do at the YMCA myself.” That makes sense. For one reason or another, people end up doing things because of time and efficiency. It’s not always what we want to do, but it’s just what happens and patients were like, “I know it better. I got more training with my personal trainer more attention and yet I still have a problem that they’re not solving. I need to find a solution. I thought physical therapy was it, but it wasn’t this brand of physical therapy. Maybe it’s this other one.” They come to see us, we find out their why, we give them a personalized plan of care. We give them as much attention as they need because we’re not limited or constrained by our reimbursement. It just gives a little bit more latitude I think. They see that. There are people that their primary goal is to get insurance to pay for it. They’re not our patients.
That’s not your ideal patient.
Our ideal patient wants to do anything possible in their own power to solve their problem.
Have you created an avatar of who your ideal patient is and what they look like?
You’ve got it all figured out. It’s important to have that because if you’re going to market, you’re going to market to that avatar or that person. How many clinics do you have?
We’ve just got one clinic.
You still got the one clinic, but you’ve got a number of physical therapists underneath you. Kudos to you. You shared with me before the show that you’re not treating anymore, that’s amazing.
I came to the point where I realized that when I’m treating one person, I can only help one person. If I’m not treating that person, I can go and spend time to put more people in through our clinic, help other physical therapists figure this whole thing out and help more people because it’s not enough. I get frustrated. It’s a little bit selfish. A couple of times a month or a couple of times a week, I’m treating patients. If someone comes in who I know like, “If you’d come to see me a few weeks ago, I could have solved this problem before it was a problem for you. I’m the first person to touch them where they’re hurt.” It makes me want to bang my head against the wall. In order to stop that pain from happening, I have to go, help other people on how to market directly to patients and put more patients through my clinic. I’ve got to hire other PT so I can spend time marketing and get more people in Greensboro to come to see us, rather than just a couple of hundred people a year.
You’re making that transition from success to significance. With the work that you’ve done, have you helped other clinic owners who are in-network with insurance to transition to an out of network situation like yours?The ideal patient is someone who wants to do anything possible in their own power to solve their problem. Click To Tweet
Yes, I have. It’s not the majority of people, but I almost know them all. People get into it and I know about it. For instance, a woman’s average reimbursement was $58 a visit but her costs to provide the treatment was $62. Everything she’s doing is losing money. One of the companies I know is $32 a visit no matter what she does. That’s less than half of what it costs for you to provide that treatment. I’ve helped people do that and pieces of it are switching how we’re selling and not just finding a good rate, but it’s the fear that if I switch, all these people are going to leave. We don’t need to keep all of those people. If you’re making $10 a person in profit, you don’t need $20 in profit, keep half of your people. We’re looking at creating a much larger profit margin, but it’s also helping fewer people.
I would say how well can we help the max capacity of people in high volume. There are people that need to get off the couch. There are people that are more complex. Somewhere in between there, we treat more complex people in our clinic because more complex patients with four or five different problems are the ones that the root problem isn’t getting solved. All their symptom problems are getting addressed but the root problem isn’t. That’s for our patients. When we go from in-network out of network, sometimes it’s a little bit different type of patient and it’s a little bit different type of symptoms. To me these days, in January and February, everyone is cash. I don’t know how many months it lasts. My personal in-network deductible is $7,500 and my in-network copay is $150.
It’s only getting worse or it seems like it’s going that way. Do you then teach the patients how to submit for insurance reimbursement if they want to do so?
If they want to, what we’ll do is we’ll provide them all the information they need and help them if they want. We don’t do it for them. With an in-network clinic that already has those processes and systems set up, doing that on the patient’s behalf is almost a no brainer. It makes it less problematic to patients because you still say, “We take your insurance. We’re not contracted but we’ll file the claim for you and everything.” It’s less of a barrier to getting in what we do. We would never say no, we don’t take your insurance. If we say no to a potential customer, they’re not going to be our customer. We just don’t do that service for them. We put it on them. It’s easier for them to do it, then for us to do it on their behalf.
A patient come in who had $2,100 worth of charges, but only $400 of it was the allowed amount and it’s only $423 went to his out of network deductible. We’re not billing three units. We will just put on there three units. Fifteen minutes is one unit, but I know some insurances here in North Carolina will allow you to build up to eight units an hour, per visit or whatever. Maybe we put eight units on there and he would be $800 in. He’s still less than half towards his deductible. The whole amount he spent out in the network isn’t getting counted. These guys are so crooked. Playing the game is not something that I want to do.
I’m sure people are going to ask, “What about your Medicares and your Medicaids? Can you see them?” There might be a longer answer to it than yes or no. Can you see the Medicares and Medicaids in a cash-based practice?
The long answer is it was a two-hour webinar. The short answer is yes, there’s a way. It may look different than what you’re doing right now even if it’s just group classes. There’s always an exception to the rule and there’s always a way to help people that you want to help, even if you can’t do it the way you thought you could do it. It goes back to what was successful. When I see a door, I knock on it, no one answers, I tried to open it, it’s shut, then maybe give it a little tug and it won’t open, I’m not going to come back and try to kick it down. Ram into it, chop it down and do everything I can to get through the door.
I’m going to say, “Three times. Let’s use another door.” The other door might be two feet away or it could be around the corner and it’s wide open. With all these things, I said, “Yes, it’s a different issue in cash-based practice with Medicare because we can’t opt out of Medicare. We could be non-par, we can have no relationship. There are other things that we can do.” In North Carolina, Medicaid is so bad that Medicaid beneficiaries, patients only get one PT visit unless they’ve had an amputation or cancer anyways. When it was better a few years ago, we still didn’t see Medicaid patients. They’re not going to the guys down the street who was in network. Medicaid adults in North Carolina can only be seen through the hospital system. All the private practices here are not seeing Medicaid patients, cash or not cash.
I don’t know why I even asked the question because if they’re on Medicaid, they can afford the cash rate.
They should be able to afford the $10 copay.
You get some coaching yourself, don’t you?
Not necessarily a cash-based PT coach, but business coach and some consulting on your own as well. How long have you had a coach?
Since day one. When I was starting my cash practice, there was another guy who had been doing the same type of bodywork I learned as a massage therapist who’s a PT. He had a cash practice in New York. His name is Scott. He helped me and five other people just get our businesses up and running with some forms, some coaching. That was about three months’ worth. Over time, I’ve used a couple of different coaches. My coach is a business coach. Bedros is out in California. Even his blog posts he put up a few years ago helped me figure out some of this marketing that we talked about. I didn’t pay him any money for a few years. I was like, “I need to get to the next level.” I found this podcast and I was like, “I need Bedros to be my coach.”
I love asking simply because I want people to know that a lot of times these successful people aren’t on their own doing it all by themselves. Many times, they have a coach or consultant behind them that helped them get to where they are. I love the fact that you had one from day one because I haven’t met a lot of them. The owners that have a coach or a consultant from day one when they know they’re going to do it or even before they even get started, the road to success seems so much easier. I’ve someone who has always been successful. You’re one of them and the guys that I’ve met. They’re successful and they’re able to navigate through the heartache, the mistakes and the issues so much easier.
It doesn’t mean it’s less work. This means the hard work I put in goes into the right grounds and get in the right direction and not repeat the same mistake someone else has done. There are things my coaches recommended and it didn’t work. There are other things like, “I got this idea.” That one idea, you want to pay it for the coaching for the whole year. That’s all I need. That one idea. Everything else is a bonus.
Do you have any books that have been influential to you business-wise?
The very first one was Guerrilla Marketing by Jay Conrad Levinson. I picked that up in 1999 when I started my massage therapy business. The internet was around but you couldn’t find this stuff on the internet. The next one that was influential for me was Russell Brunson’s book, DotCom Secrets. If you’ve got an in-person business, the book I would pick up would be Expert Secrets, which was his follow-up book. DotCom Secrets, for me, was the influential one. Expert Secrets is what I recommend to someone who does not have an online business. Those are the big ones. In Expert Secrets, I’ve got everything written in the margins, then I keep it and I keep going back to them like, “I need to do that.”
It’s all regarding the online stuff.
Expert Secrets is about building a following, creating your marketing message, how do you tell stories and how do you do it. DotCom Secrets was the online one. It was about how you build online. A clinic owner could use that to create their follow-up email sequence. Those two help each other. Then the third book would be my coach’s book, Man Up. It’s a leadership book and it’s great. Even though its title is Man Up, that was his mantra when he was going through the deep crap. Bedros was like, “It’s time to man up.” It’s what he says. It’s about business ownership and leadership and it’s great.
What’s Bedros full name?
Bedros Keuilian. He’s a fitness guy. I had to go outside of physical therapy to learn how to market physical therapy. I had to learn how to market directly to patients. Everyone’s APT APPS is like, “Here’s how you go buy physicians lunches. Here’s how you say hello to them and shake their hand. Here’s how you put an ad in the newspaper and here’s how you put board up and had a radio ad.” All these things cost way more money than I had. That’s not effective so I didn’t go to fitness to learn how to market directly to my patient.
The successful owners are going to have to start learning how to do that direct to consumer marketing. Physician referrals are down and it’s important to have relationships with physicians in general in your community. People who are going to navigate through the changes that are coming and some of the networks that are being formed with the hospitals, they’re going to have to find a way to be successful to work directly to consumers.
I’m not saying the relationship with physicians is what we should have. I’m saying we need to flip the script. I know physical therapists who have physicians calling them up. Asking them to meet because the physical therapists are bringing patients into the system and spreading them out to the places that are like, “I’m going to be a gatekeeper or the dispatcher.” That’s a fracture. You need to go over there. It looked like an autoimmune disease over here first. You’ve got this other problem that’s not back pain, that’s something else. If we do that, then we have as much, if not more power because we have more time. We got what we need. That’s how it should be. That’s not what people are talking about. There are missing pieces. It’s like, “How do we be successful if we act and be the person that patients can come and approach on the street and get some real answers?” They can call our clinic and we can help them or we can share them out to the other people that need it.
It’s a change of the mindset and shifted the paradigm, where we have to take it upon ourselves, take on the mantle that we are the musculoskeletal injury experts. We’ve shrugged that off for so long or just coward at maybe taking that away from the physicians or the idea that it might be happening. It’s not like that. We are the experts and we need to stand up.
Personal trainers are taking it away from us because we won’t man up and take it ourselves.
Someone else will, that’s for sure.
Someone is going to do it. To me, I’ve told patients like, “Their job is to keep you alive.” At the end of the day, there’s not enough of them for as many people that are sick and dying. Their number one priority is to make sure you don’t die on their watch. Beyond that, if you’ve got back pain, you need to be seeing someone else. They may not know who to send you because they don’t have time to know everybody so it’s a good thing that you’re here. I’m sorry you had that bad experience, but you’re in the right place. If we need to get you back to see them, that’s where you need to go. One of those things is they used to have more time. There are more images, testing, then a lot of pressure and they don’t have as much time to spend. No one does. That’s why I wanted to get myself out of the insurance model because I want to be able to have myself and my therapist spent the time we need with our patients no matter what.
Congratulations on your successes.
I appreciate it.
It’s a long time coming too. If people want to reach out to you and learn more about how they can switch out or pick your brain on cash-based practices, how would they do that?
The best way to do that is through my website, AaronLeBauer.com. I’m also on Instagram, Facebook, and Twitter. I’m not really on Twitter, but I’m on Twitter. Whatever your preferred platform, it should be @AaronLeBauer. From there, you can find resources on free webinars, my free Facebook group, blog, podcast and all that other information. If you’re on the podcasts like this one, the CashPT Lunch Hour is my podcast.
I invite people to listen to it because you’ve got some great insight. By all means, if people are considering, “How do I drop out this contract? How do I get rid of this contract and what do I do in this situation?” If they want to strictly go out on their own and do the cash-based stuff, I highly recommend to reach out to an expert like you, for sure.
Thank you, Nathan. I appreciate it.
It was nice having you on the show. Thanks.
I appreciate all your compliments and the questions are amazing. I just love talking about this stuff.
You’ve got a great passion for it. You’re killing it so keep it up.
Thanks. I appreciate it.
- Aaron LeBauer
- The CashPT Lunch Hour Podcast
- CashPT Nation Facebook Group
- Kim Rondina – previous episode
- Guerrilla Marketing
- DotCom Secrets
- Expert Secrets
- Man Up
- Bedros Keuilian
- Instagram – Aaron’s Instagram Account
- Facebook – Aaron’s Facebook Account
- @AaronLeBauer – Aaron’s Twitter Account
About Dr. Aaron LeBauer