Successfully Dropping Low-Paying Insurances With Marc Moore, PT

[00:00:00] Don't be silly. Don't continue to do what you know you shouldn't. Don't be afraid of the devil you know versus the devil you don't. It's all a fight. It's all a battle. You have to get up every morning and try to solve your next problem. But if you know you have a problem, then at least solve the ones you know.

[00:00:21] They come. So I knew this was an issue and knew that I had to be faced. And on top of all that, I didn't feel like principle wise that I was doing the right thing.

[00:00:34] Welcome. You've entered the Physical Therapy Owners Club podcast where your host, Nathan Shields, and other successful PT owners and leaders share their experience and insights on how to build successful PT businesses.

[00:00:46] They'll share the stories of their paths to success and show you how you can also obtain greater freedom and more profits from your business.

[00:00:54] That's what the PT Owners Club is all about. Greater freedom and more profits. There's plenty of room for you as well. So come on in and join the club.

[00:01:06] Hello, and welcome to the Private Practice Owners Club. I'm Nathan Shields, and I got my good friend, Mark Moore from Moore Physical Therapy, founder and CEO.

[00:01:15] He's also a good friend of mine from being in physical therapy school at NAU Physical Therapy Program back in the day. That was a couple decades ago. It's been a long time, man.

[00:01:26] 1996.

[00:01:27] That's right. 99. Our graduation was 99.

[00:01:31] Yeah, we would have met in 96.

[00:01:32] Oh, that's right. Then we go back almost 20 years or 30 years. Holy crap.

[00:01:38] Yeah.

[00:01:38] I just really aged myself, dude.

[00:01:40] You weren't married. You were a single guy.

[00:01:43] That's right. That's right. Well, cool. Thanks for joining me again. I've had Mark on the podcast before, and it's good to have you back, man. Thanks for coming.

[00:01:52] You bet.

[00:01:52] Well, hey, I'm really excited to bring you on. It was, I think it was a couple of years ago now that you and I started having conversations because you were seriously looking at how to increase your average reimbursement rate.

[00:02:03] Right. And one way to do that. And I know you've done some other things and maybe you'll share with us in terms of negotiating with insurance companies.

[00:02:11] But in this particular situation, why I wanted to talk to you today is because you were seriously looking at dropping UnitedHealthcare, one of your lower payers, right?

[00:02:20] So give us a little backdrop on that. What led you to the idea that I seriously need to consider this action?

[00:02:26] Yeah, it was. And this will be no surprise to anybody in the space. It was both the fact that they wouldn't pay a reasonable amount as well as their administrative burden was so high.

[00:02:41] And that's the kind of formula for us that we dropped insurances that are the highest admin coupled with the lowest pay.

[00:02:49] And we've now dropped two insurances, both UnitedHealthcare about a year and a half ago. And May 24th, I remember the day because it was a liberating, the day of liberation.

[00:03:06] I've always been frustrated with the administrative side of what UnitedHealthcare, how they would operate.

[00:03:12] And they've actually gotten a lot worse recently with all of their authorization requirements. It's been so nice to be like, that doesn't apply to me.

[00:03:21] So and then more recently, we got rid of one of our Medicaid options here in the state of Arizona.

[00:03:27] And that one was the same thing. It was that was especially heavy in administrative burden.

[00:03:33] And so we got to a point where I was like, OK, with UnitedHealthcare, the dance would be we'll just see two of them every 30 minutes and then it'll make it worth it.

[00:03:44] Right. And as we sat down, decided, hey, this is just not who we are.

[00:03:49] We don't want to be McDonald's. No dig on McDonald's. But, you know, we don't want to crank this out.

[00:03:55] We want to be Red Robin. We want to have some automations and some systems in place.

[00:04:01] We don't want to be mom and pop either, but we want to have we don't want to just crank those out, double our notes, double the other things that go along with that.

[00:04:12] And our concern, I mean, I don't think any of your listeners will be like, oh, that surprises me.

[00:04:18] But our concern was, hey, are the doctors going to go, OK, no, we're not going to send over there now because we have to choose.

[00:04:26] Do they take this insurance? Do they take that insurance? That was the big concern.

[00:04:31] I was like, do we do this? Because we should have done it eight years earlier now that I've done it.

[00:04:36] We should have done it years ago. I've been in business now for 22 years and we should have done it maybe sooner than that.

[00:04:42] But other people did. Other people were much more pioneer than I am more recently done this.

[00:04:49] But so those those were the big decisions.

[00:04:51] Why? And then the other concern was you lose the relationship with the patient who you love and they love you.

[00:04:57] And that is the bitter pill that you have to swallow, because the first concern about the doctors really has not turned out to be the reality of things.

[00:05:06] The reality is those doctors, when I went to help my doctors, the ones that we have a relationship with, they're like, dude, I wish I was as brave as you are.

[00:05:13] Like, I need to drop this. I need to drop that. They looked at you respectable.

[00:05:17] And I think, yeah, they respect your decision. They understand that.

[00:05:21] So it hasn't been the big worry.

[00:05:24] Going back to it, I know when you were looking initially at the numbers.

[00:05:28] So in Arizona, the flat rate was what?

[00:05:32] 65, $75 or something like that.

[00:05:34] Yeah.

[00:05:34] 65.

[00:05:35] 65 a visit.

[00:05:36] Yeah.

[00:05:37] Obviously your cost to see that patient per visit was significantly higher, I'm assuming.

[00:05:41] Totally. Yeah.

[00:05:42] I mean, it's probably close to 20 bucks more than that per visit.

[00:05:45] Yeah.

[00:05:45] Yeah.

[00:05:46] Yeah.

[00:05:47] Because I could, I've said it before.

[00:05:49] You could just as easily just hand that patient a $20 bill as they walk in and let them leave.

[00:05:55] And it'd be about the same outside of the value that you provide.

[00:05:59] But financially, yeah, it's about the same as doing that.

[00:06:02] Right.

[00:06:03] I had a coach that said, because there's a guy who was saying, hey, why are you doing this?

[00:06:08] And I'm like, oh, this worry, that worry.

[00:06:10] He goes, I want you to do something.

[00:06:12] He goes, I want you to go home tonight when you sit down at the dinner table.

[00:06:15] And I want you to look over at your family and tell them, hey, I saw X film the number of patients today

[00:06:23] and lost $20 each for each one of them coming in.

[00:06:26] And I did it.

[00:06:27] He challenged me to do this.

[00:06:28] So I did it.

[00:06:29] I sat down and my daughter, who was like, she would have been like 17 years old.

[00:06:33] She looked at me like, why, dad?

[00:06:35] I was like, I don't know.

[00:06:40] Yeah.

[00:06:42] And it was like this thing.

[00:06:43] Like, there's no good reason.

[00:06:45] Like, because I'm afraid of change, but I'm afraid of the unknown.

[00:06:48] I mean, that was the reason really.

[00:06:51] It's wonderful to have coaches and mentors like that, that are outside of our bubble and

[00:06:56] don't understand our worries and our concerns and our excuses, frankly.

[00:07:01] Yeah.

[00:07:01] And for them to put it like that and to, for you to have to actually face that and provide

[00:07:07] some kind of valid excuse that doesn't land with them.

[00:07:10] Yeah.

[00:07:11] Is she as a hugely valuable exercise.

[00:07:13] Yeah.

[00:07:14] My daughter's like, I don't get it.

[00:07:17] I don't either.

[00:07:19] Yes, exactly.

[00:07:20] That's an idiot.

[00:07:21] But you're speaking to the industry at large, the private practice owners out there, they

[00:07:27] are somehow going to do the mental gymnastics to make it work because they think other people

[00:07:34] need you or have to see that in you.

[00:07:38] Right.

[00:07:39] And there, I don't agree with it, but there is a belief that as a newer owner,

[00:07:43] taking some of those contracts could be worth it because you're trying to fill spots and

[00:07:49] you're going to have this minimum level of overhead anyways.

[00:07:53] And so you might as well take the added revenue because your expense line is going to stay about

[00:07:57] the same, whether you take them or not.

[00:07:59] So you might as well.

[00:07:59] I can maybe grasp onto a little bit of that.

[00:08:03] But at this stage, I mean, you already had three clinics going.

[00:08:08] You're relatively productive through across three clinics.

[00:08:11] You are profitable across the three clinics in total.

[00:08:14] And so thinking back two years ago, you and I spent probably a few hours on a screen share,

[00:08:21] if you recall, looking at your numbers related specific to this one insurance.

[00:08:26] And I remember looking at your pair mix by percentage.

[00:08:30] And so if you recall, it was UnitedHealthcare compared to your total visit number was what,

[00:08:36] 10, 15%.

[00:08:37] Do you recall approximately what revenue percentage that equated to the revenue from those insurance

[00:08:45] compared to the actual visit is 12%?

[00:08:48] Yeah.

[00:08:49] Yeah.

[00:08:49] That's right.

[00:08:49] You were the first one to point that out to me and say, Hey, look at this.

[00:08:52] It's not, it's not like you're going to lose 15% of your income.

[00:08:57] You're going to lose this lower amount of your income.

[00:09:00] You're going to lose 15% of the work.

[00:09:02] You know what I mean?

[00:09:03] That was a shifting in my thought too.

[00:09:05] It was like, yeah, I didn't thought about that way.

[00:09:08] It's another reason to do it.

[00:09:10] Yeah.

[00:09:10] Because when I talk to people about it, usually that number falls somewhere around there,

[00:09:15] somewhere around 10% and could be as high as 20% according of their payer mix in visits.

[00:09:23] But when you look at the financial impact of dropping that insurance, that being 10 to 12%,

[00:09:29] was there any way that that made it a little bit easier to swallow?

[00:09:32] Like, man, we could find ways to make up the 10% in revenue.

[00:09:37] That's going to be lost.

[00:09:38] You couple that with the fact that some of those UnitedHealthcare patients I'm now seeing

[00:09:42] still because their plan was such that they didn't have any different financial impact

[00:09:51] out of pocket for a out of network versus an in network.

[00:09:55] So we retained, and I don't know this exactly, but I would say probably somewhere in the

[00:10:00] neighborhood of 10 to 20% of people.

[00:10:05] It's not 20.

[00:10:06] It's probably more like 10%, 5 to 10% of our healthcare.

[00:10:11] And those, UnitedHealthcare pays really nicely out of network.

[00:10:15] Out of network.

[00:10:16] They are actually now our best payer.

[00:10:19] We now love UnitedHealthcare.

[00:10:21] Yeah.

[00:10:21] You know?

[00:10:22] And so I haven't done that math exactly, but how much of that 12% that we were financially

[00:10:29] losing did we actually gain is another couple percentage points probably.

[00:10:36] So maybe we're down to only nine or 8% of a loss financially.

[00:10:41] Right.

[00:10:42] So.

[00:10:42] Well, looking at it big picture, say a year later, and I know you're, you don't have the

[00:10:49] numbers in front of you a year later making that decision.

[00:10:53] Was it an overall net loss or net gain to your profit margin by dropping that insurance?

[00:11:01] No, it was gain.

[00:11:03] I'd say absolutely.

[00:11:04] We found other ways to.

[00:11:07] Fill the schedule with higher paying insurances.

[00:11:09] Yeah.

[00:11:10] I mean, you're always in the process of maybe we took a little longer to hire and the next,

[00:11:15] maybe we didn't grow quite as fast, but we were on the positive side of all the visits,

[00:11:21] right?

[00:11:22] Our per visit rate goes up.

[00:11:25] And so.

[00:11:26] Your profit margin goes up.

[00:11:27] It didn't hurt us.

[00:11:29] Yeah.

[00:11:29] I know people say this all the time on podcasts and in this situation, I think it's appropriate

[00:11:35] because, and I don't like to ask it very often, but in this situation, what would you go and

[00:11:40] tell the Mark from two years ago that was in that fearful situation?

[00:11:44] What would you tell him?

[00:11:45] I would just say, don't be silly.

[00:11:48] Don't continue to do what you know you shouldn't.

[00:11:51] Don't be afraid of the devil, you know, versus the devil.

[00:11:55] You don't, you know what I mean?

[00:11:56] Like it's all a fight.

[00:11:58] You know what I mean?

[00:11:58] It's, it's all a battle.

[00:11:59] You have to get up every morning and try to solve your next problem.

[00:12:03] But if you know you have a problem, then at least solve the ones, you know, you know,

[00:12:09] they come.

[00:12:10] So I knew this was an issue and knew that it had to be faced.

[00:12:14] And on top of all that, I didn't feel like principle wise that I was doing the right thing.

[00:12:20] Like somebody else who would say, Hey, I dropped them a long time ago.

[00:12:23] That's not, that's not a acceptable amount to get paid.

[00:12:27] I'd be like, yeah, I wish I was that guy.

[00:12:30] That guy's braver than me.

[00:12:31] You know what I mean?

[00:12:31] I wish I was that principled.

[00:12:32] As a principle, like it's true that it's not right that we're accepting that as an industry.

[00:12:37] Right.

[00:12:37] It's not right.

[00:12:38] And so, but I'm like, well, yeah, but I've got to pay the bills.

[00:12:42] It's just not true.

[00:12:43] Yeah.

[00:12:43] There's some kind of disconnect dissonance in our logic, right?

[00:12:48] Right.

[00:12:48] Yeah.

[00:12:48] Because we think without the numbers in front of you, that it's easy to make up some kind

[00:12:54] of stories.

[00:12:54] Like this is going to severely impact me financially.

[00:12:57] This is going to impact me, my reputation, because I'm not taking X insurance and the

[00:13:03] position groups are going to be upset about.

[00:13:05] That's the story we tell ourselves.

[00:13:07] And you found out that those things were lies.

[00:13:12] Hey everybody.

[00:13:13] We finally did it.

[00:13:15] Finally, we're doing our first in-person event, the private practice owners club,

[00:13:19] first ever in-person conference, September 20th and 21st in Clearwater beach, Florida.

[00:13:24] Adam and I are super excited.

[00:13:25] Really can't wait to finally meet you in person.

[00:13:28] This entire time I've been preaching, reach out, step out, network.

[00:13:31] And I can now provide that to you, not just virtually or via podcast, but in person.

[00:13:36] We'll have speakers that speak on leadership and growth.

[00:13:38] We'll answer questions to your current issues.

[00:13:40] We'll provide you opportunity to network with like-minded individuals and obviously gain

[00:13:45] inspiration and energy from being in the room with the same people.

[00:13:48] You'll be able to literally reach out, step out and network all in one weekend, September

[00:13:53] 20th and 21st at the Hyatt at Clearwater beach, Florida.

[00:13:56] I would really love to see you there in order to register, go to ppoclubevents.com ppoclubevents.com

[00:14:04] and register to sign up for the event.

[00:14:07] Also early bird registration ends July 31st.

[00:14:10] So to get a discount on the registration fees, make sure you sign up, get your room between

[00:14:14] now and July 31st.

[00:14:16] Otherwise prices will go up.

[00:14:18] So go to ppoclubevents.com.

[00:14:22] Thank you to all of you who have listened for so many years.

[00:14:24] I would love to finally meet you in person.

[00:14:41] The biggest challenge, exactly what you said is accurate.

[00:14:44] You're lying to yourself.

[00:14:45] I was lying to myself, but the biggest challenge I had was with my staff was saying to my staff,

[00:14:53] we're going to drop this insurance because they were like, well, wait a second.

[00:14:57] Who does that impact?

[00:14:58] And once they saw those names, those individuals, because now that I'm not directly in the clinic

[00:15:05] treating patients, I know some of those individuals from when I was years ago.

[00:15:11] But a lot of them I don't.

[00:15:12] And they're not, it's not my buddy who I'm going to see day in and day out, week in and

[00:15:16] week out.

[00:15:17] That's what was hard.

[00:15:18] It was hard to tell my staff, hey, I'm sorry, but you're going to have to tell these

[00:15:22] people.

[00:15:22] So in the case of the, and all the cases really, but primarily in the Medicaid insurance, we

[00:15:30] just said, hey, we're going to time this when in October is when that the deductible re-ups.

[00:15:35] So we timed it to be around like August when we started notifying them saying, hey, we're

[00:15:41] dropping this, dropped it in early September and said, if you can switch over to another

[00:15:48] plan.

[00:15:49] And we had a number of them that did.

[00:15:51] So we still retain them.

[00:15:53] Yeah.

[00:15:54] When is it time to re-up their Medicaid plans?

[00:15:56] Yeah.

[00:15:57] So we retain them as patients.

[00:15:59] They got what they wanted, which was to stay with us and the care we were giving.

[00:16:03] But they just said, I'm going to switch over to this other plan, which was an acceptable

[00:16:06] payer for us.

[00:16:08] There are some acceptable payers.

[00:16:09] We said, here's the ones that we will take.

[00:16:11] And so that was a good situation for us.

[00:16:14] And that's a little bit different situation in the state of Arizona because not all states

[00:16:17] have third party Medicaid providers like that.

[00:16:21] So like in a state like Alaska, you either have Medicaid or you don't.

[00:16:26] But in Arizona, they farm that out to third party insurance companies that can run their

[00:16:31] insurance programs for them.

[00:16:32] So the Medicaid clientele has a choice between different Medicaid programs.

[00:16:37] So I do have to kind of throw that out there.

[00:16:39] Interesting.

[00:16:40] But talk to me a little bit about that, because one of the first steps that I see, if you're

[00:16:44] going to drop an insurance plan is you have to be really clear between you and that has

[00:16:51] to flow into your team, that you provide such a value for your patients that going again,

[00:16:58] that taking this insurance actually goes against our values.

[00:17:02] Yeah.

[00:17:03] And I know that's an exercise or a conversation, at least that you had to have with your team

[00:17:07] for them to be on board and to get over this idea that we're going to be the martyrs.

[00:17:14] We're going to sacrifice.

[00:17:15] We're going to take the financial hit to see this insurance company for the benefit of

[00:17:19] our patients, rather taking a stand and saying, no, we provide X value and it's beneath us

[00:17:26] is goes against our values to actually accept this insurance.

[00:17:30] How did that conversation?

[00:17:32] What did that exercise look like?

[00:17:34] How did you get on the same page with your team that they also now believe that there's

[00:17:39] no way that we should accept this insurance?

[00:17:41] How did that go about?

[00:17:42] It's a great question because that really was the thing I spent the most time on.

[00:17:46] I showed them, I said, okay, we do have options in everything in life.

[00:17:49] We've got options.

[00:17:50] We could choose to see these are per diem in UnitedHealthcare's case.

[00:17:55] These are per diem patients.

[00:17:56] We could see, you know, however many an hour we want.

[00:17:59] We could do this and kind of show it, laid that out.

[00:18:03] Or we could do that, you know, this other and, you know, and just kind of laid out the

[00:18:07] whole picture of what would this mean?

[00:18:10] What would this look like for you?

[00:18:11] Did you share with them?

[00:18:12] I don't want to cut you off, but did you share with them the same numbers that you and I

[00:18:15] were looking at?

[00:18:15] Oh, yeah.

[00:18:16] Yeah.

[00:18:16] Yeah.

[00:18:17] It was very, very open with.

[00:18:18] Like they understood that you were losing money.

[00:18:21] What we get paid, what it costs us to deliver care.

[00:18:25] Right.

[00:18:25] So if we're underneath in this current, we'd have to get up to here to make a profit to pay

[00:18:31] and then say, you know, I know you guys want the same things I want.

[00:18:35] You want to be able to increase your pay year over a year.

[00:18:38] You want to be able to have additional benefits in the company.

[00:18:41] There's all these things that we would love to have.

[00:18:44] And those things become affordable when we increase our pay per visit to this level.

[00:18:52] And, you know, this is the impact is having on us negative.

[00:18:55] We have to do something.

[00:18:57] Choose this or choose this.

[00:18:58] Or maybe you could come with an idea that I haven't thought of.

[00:19:02] Bring them into the discussion, have them propose ideas, then talk about what would that

[00:19:07] mean?

[00:19:08] You know, their idea.

[00:19:09] And so it was very clear that in our organization, the choice was to do this, even though it was

[00:19:17] hard.

[00:19:17] So you had to get your team on the same page and understand that we provide such a value

[00:19:22] that taking this insurance is not a benefit to the company, not to the owner, not to the

[00:19:27] company, not to them because it's going to infringe on their ability, on your ability to provide

[00:19:32] them benefits or raises, et cetera.

[00:19:34] Right.

[00:19:34] But what was the overall message then?

[00:19:37] What did you have to say to the patients?

[00:19:41] Right.

[00:19:41] I'm sure you guys kind of came together and had to come up with a unified story as to

[00:19:45] why you're dropping.

[00:19:46] And what did that look like?

[00:19:48] Yeah, that's a good question.

[00:19:49] So we made sure that we gave some notice so that the patients weren't just left high

[00:19:55] and dry.

[00:19:56] Blindsided.

[00:19:57] Sure.

[00:19:57] We explained to them that they have other options, that we can see them still.

[00:20:02] You know, we can see them on an out-of-network basis and that we will be telling them exactly

[00:20:07] what that would look like to them financially.

[00:20:09] So we did the work to look at what their out-of-network benefits were and then said, here's your options.

[00:20:15] You can continue.

[00:20:17] This is what it'll cost here.

[00:20:18] If you continue in-network basis, this is what it'll cost you.

[00:20:23] Here's some of the local options you have nearby.

[00:20:25] We think that this physical therapy outfit over here would be a good decision if that's what you choose to do.

[00:20:33] In fact, there was one individual that was particularly tough to see him go.

[00:20:40] He'd been with us for a while.

[00:20:42] And the physical therapist went with this individual to his first physical therapy appointment at the new facility.

[00:20:51] And I handheld him over and said, hey, everything's going to be fine.

[00:20:55] Sat in the room with him.

[00:20:56] And I was over at the office the other day when he came in.

[00:20:59] And it had been like a year since they'd seen him in the office.

[00:21:02] And he came in and everybody just got up and ran to him and hugged him and was like, we miss you so much.

[00:21:07] And he was like, hey, I'm doing really good.

[00:21:10] But he was coming back in to say, I miss you guys.

[00:21:14] He'd had a good experience at the other place, which was great.

[00:21:17] He was getting the care he needed, which was really the big concern was for our front office.

[00:21:23] So I think it kind of gave them that, okay, well, we took care of these individuals' needs as best we could.

[00:21:30] And they're getting the care that they need elsewhere.

[00:21:33] Right.

[00:21:34] Did you actually lay out a reason why you were dropping the insurance with those patients?

[00:21:40] Did you spell out the financial impact or whatnot?

[00:21:43] Did you share some of that?

[00:21:44] Just generally, we just say we can't afford based upon the time and the care that we give.

[00:21:51] And a lot of people have been in other physical therapy facilities.

[00:21:55] And they've sensed that what we do at ours is maybe a little different.

[00:22:01] I mean, they would sense, hey, these guys spend more time with me than my other experiences.

[00:22:09] And so it's not a difficult thing to say, oh, the additional time and effort and staffing that we have here to make sure that we are one-on-one with you is a different model than having, you know, you do your exercises kind of nearby and we kind of watch from a distance, which is another model.

[00:22:29] And that's okay.

[00:22:31] It's two different things.

[00:22:32] If you want this, what we do, we can no longer get paid by the your insurance company because they just don't pay us enough.

[00:22:40] So we were straight up with that.

[00:22:43] Right, right.

[00:22:44] So you were very clear that, you know, it's not affordable based on the experience that we want to provide, the customer service that we want to provide.

[00:22:51] We can no longer accept this insurance plan.

[00:22:54] And so it was pretty cut and dried.

[00:22:55] You didn't it sounds like you didn't wordsmith it too much.

[00:22:57] You were pretty straightforward.

[00:22:58] But it sounds like your team also had that same story.

[00:23:02] Like, I think that's an important part is someone's dropping an insurance that the message has to be unified between everybody.

[00:23:08] Yeah.

[00:23:09] Because the last thing you want to see is a patient that talks to, say, a technician and gets one story, talks to provider, gets a different story, and then talks to the front desk and gets a different story.

[00:23:19] You guys had to be all on the same page to make this go wrong.

[00:23:22] I think that was an area that you advised me in, and that was something we really focused on because of that.

[00:23:28] So you helped me think about that beforehand.

[00:23:31] And I went to my clinic directors and I said, imagine if I gave them that scenario and said, what would this look like?

[00:23:38] And I think they were just like, yeah, we better make sure that we communicate the same thing across all three clinics and across all employees.

[00:23:48] And so I don't think we were perfect at it, but I don't think we're perfect at most things.

[00:23:55] You know what I mean?

[00:23:55] But we did well.

[00:23:58] No, it was all of the difficulty was pre-drop pretty much.

[00:24:02] Let's drop everything.

[00:24:03] So after dropping it, the backlash wasn't as severe as you had imagined.

[00:24:07] Yeah.

[00:24:08] Once it was over, it was like, yes.

[00:24:10] Right.

[00:24:10] All the work on the front end kind of minimized that concern on the back end, right?

[00:24:14] That backlash.

[00:24:15] But looking back, how long did it take for you to say that was a positive decision?

[00:24:21] Was it before the actual contract end date or was it sometime after that?

[00:24:27] It was probably once we all, I felt like all my team was on the same page.

[00:24:31] So before the 90 days or 60 days, whatever it took to was up, you felt like that was a positive decision.

[00:24:36] No matter what the financial impact was after the fact, it didn't take months after that to figure that out.

[00:24:42] So I think that would be a fair statement.

[00:24:44] Yeah, I never thought about it that way.

[00:24:45] But in retrospect, I think that it was a good decision and I knew it before the 24th of May actually hit.

[00:24:54] Oh, I gotcha.

[00:24:54] And so how long was it before then that you decided to drop the other insurance plan?

[00:24:59] The other one took about a year.

[00:25:00] I just recently dropped the other one.

[00:25:02] And so, and why it took that long, I just didn't jump to it.

[00:25:08] I don't think I should have done it more immediately.

[00:25:11] There's really not, it's a much smaller.

[00:25:13] This represented, I think like 1%, maybe 2%.

[00:25:16] Oh, okay.

[00:25:17] All of ours.

[00:25:18] And so they just got backburnered.

[00:25:21] And I just need to get this done.

[00:25:23] And honestly, the thing that held me up probably for both of these was not having my contract in hand.

[00:25:29] So I was sending off to this, you know, health plan saying, hey, can you send me my contract?

[00:25:34] I don't have it here anywhere.

[00:25:35] Having to wait to get that back from them and all that stuff was an additional time frame.

[00:25:40] And so that's one thing it's, I'm trying to do now is have all of my contracts folder so that it's like, okay, anytime I want to pluck it out.

[00:25:49] And actually I'm into that point.

[00:25:52] I have increased payment in three insurances through simple negotiation recently.

[00:25:59] That was going to be my next question.

[00:26:00] So before you jump into that, did you try to negotiate with either of these plans?

[00:26:06] Which ones?

[00:26:07] Both of them.

[00:26:08] And so you got negative responses both times.

[00:26:10] Yeah.

[00:26:11] UnitedHealthcare was just like, it's not going to happen.

[00:26:14] Like no interest, no negotiation.

[00:26:16] The other one came back and increased what they were paying by $20 per visit.

[00:26:22] The other one.

[00:26:23] And I said, you're still below where I need to be.

[00:26:26] And we still agreed to disagree.

[00:26:29] And I dropped it.

[00:26:30] So they actually flew way more.

[00:26:32] Actually, they were by far our most.

[00:26:35] Like UnitedHealthcare, did they have a significant administrative burden as well?

[00:26:39] If UnitedHealthcare would have come back and said $85, we would have taken it.

[00:26:42] Way more.

[00:26:43] Oh, okay.

[00:26:43] So it wasn't, they had to get like way higher than what you were collecting per visit to

[00:26:48] be worth it, considering that.

[00:26:49] These people came back and said $85.

[00:26:51] And we said, with your administrative burden, it needs to be $100 a visit.

[00:26:54] Oh, okay.

[00:26:54] Or we're not.

[00:26:56] It's like break even.

[00:26:58] Well, I'm just assuming.

[00:26:59] I don't know your numbers, but I'm still thinking $85 is close to cost per visit for you.

[00:27:03] We'd have taken it still.

[00:27:04] Yeah.

[00:27:04] We'd have still done it, I think.

[00:27:06] For.

[00:27:06] Okay.

[00:27:07] And you're okay with that on UnitedHealthcare side?

[00:27:09] Yeah.

[00:27:10] I think we would.

[00:27:11] And whether or not that was smart.

[00:27:12] Yeah.

[00:27:13] Well, your pay per visit.

[00:27:15] Okay.

[00:27:16] I mean, that's fine.

[00:27:17] No judgment.

[00:27:17] You can get your pay per, you can get your per visit cost down into the 60s when you always

[00:27:25] have your productive, right?

[00:27:27] You know?

[00:27:27] And so it's not all that idea then.

[00:27:30] If you're super productive with the same staff, if you've got your team being super productive,

[00:27:34] the expense rate stays the same while you're seeing more visits.

[00:27:38] So then your cost per visit goes down.

[00:27:40] I get it.

[00:27:40] I get it.

[00:27:41] Yeah.

[00:27:41] It just means you have to really push production and make sure that's humming, right?

[00:27:45] You just can't have gaps in your schedule.

[00:27:47] Yeah.

[00:27:47] You got to be, you got to have a wait list.

[00:27:49] You got to be backfilling those wait, those people when they cancellations come.

[00:27:53] Yeah.

[00:27:53] It's all doable, right?

[00:27:55] Right.

[00:27:55] You do it every winter here in Arizona.

[00:27:57] Everybody does.

[00:27:57] You get so busy.

[00:27:58] You can't see everybody.

[00:28:00] And then the summers, it's a little softer, but different parts of the country is probably

[00:28:04] like.

[00:28:05] Right.

[00:28:06] Exactly.

[00:28:06] And I do want to get into the negotiation part, but did you find that your confidence

[00:28:11] in dropping some of these insurance increased because of your initial experience?

[00:28:16] Yeah.

[00:28:16] Yeah.

[00:28:17] Yeah.

[00:28:17] So now you're on the hunt a little bit to either negotiate or drop them.

[00:28:21] It sounds like.

[00:28:22] Right.

[00:28:23] And since then you've had greater confidence in negotiating and you've had some wins.

[00:28:27] Yeah.

[00:28:28] Yeah.

[00:28:28] Yeah.

[00:28:28] So when they come back and they say, hey, we'll pay you $85 versus $65.

[00:28:35] And I said, you got to get here.

[00:28:37] And they said, no.

[00:28:38] I said, okay, well then we're going to drop you.

[00:28:42] And because I just, all of the variables, it was such a small 2% of all of our costs, a ton

[00:28:48] of admin burden.

[00:28:49] But then with these other, especially with workers' comps.

[00:28:53] It's easy to lose them.

[00:28:54] I think that's, they're making, the third party administrator is making so much money.

[00:28:57] There's so much room there.

[00:28:58] Right.

[00:28:58] I just recently, just last week, sent back for a second time.

[00:29:02] So I said, hey, we want to get paid $120 per reason.

[00:29:06] And they come back and they said, right now we're getting $90.

[00:29:11] Right.

[00:29:11] Right.

[00:29:12] So we come back and they say, we'll do $95.

[00:29:14] And I said, well, that's great.

[00:29:17] That's a good win.

[00:29:18] But because I'm used to, that's profitable.

[00:29:20] Right.

[00:29:21] But then I said, we want a hundred.

[00:29:24] Right.

[00:29:25] And they came back and they said, okay, we'll do it.

[00:29:29] It wasn't that hard.

[00:29:30] It was just a matter of waiting two weeks in between responses, you know, and when that

[00:29:35] happened, our Cigna carrier or Cigna third party ministry, especially health Ash.

[00:29:42] We were able to do that with them too.

[00:29:43] They came back and we said, we want this.

[00:29:46] And they, same thing.

[00:29:47] It went back and forth three times and ended up increasing that one.

[00:29:52] And right now I'm in conversation with Blue Cross Blue Shield.

[00:29:55] Their methodology, I've been through this before with them a few years ago and didn't get any

[00:30:00] adjustment.

[00:30:01] Yeah.

[00:30:02] They are asking the same sets of questions and their methodology isn't just ask and

[00:30:08] we'll tell you.

[00:30:08] Theirs is, okay, answer these questions and establish how you're different.

[00:30:14] And they want you to please your case.

[00:30:17] And so we're still midway through that.

[00:30:20] Right.

[00:30:20] Yeah.

[00:30:21] We don't have the time to get into the details as to how you negotiated and whatnot.

[00:30:25] And that's, frankly, that's a different podcast episode altogether.

[00:30:29] Yeah.

[00:30:30] Well, and I don't think I'm the best at it.

[00:30:32] Like, I think there's people out.

[00:30:33] But you tried, I mean, you're reaching out, you're talking to the contract service providers,

[00:30:37] right?

[00:30:37] You're actually trying to negotiate with people and not just sitting around, which is,

[00:30:42] that's awesome.

[00:30:43] Yeah.

[00:30:44] Hey, that's a difference maker.

[00:30:45] I mean, when you make a couple more dollars per visit, that's a big difference.

[00:30:51] It's huge.

[00:30:51] It goes right into your pocket, frankly.

[00:30:54] Right?

[00:30:55] Because expense line should stay the same.

[00:30:57] You get another $10 per visit.

[00:30:59] Yeah.

[00:30:59] You extrapolate that over the course of a year and the number of visits that you see,

[00:31:03] that's just added profit, right?

[00:31:04] You can do a lot for your employees, for your family, for your business, expansion, et cetera,

[00:31:10] because you just, you made a big difference.

[00:31:12] I don't think anybody in our organization would say that was a bad decision.

[00:31:17] Everybody would be like, oh yeah, that was the right thing to do.

[00:31:20] Can I ask, since you started this with, I know you started with Blue Cross Blue Shield

[00:31:24] three years ago.

[00:31:26] They didn't make any change back then.

[00:31:27] They might now, but now that you've been through the United Healthcare, the Medicaid

[00:31:31] and the renegotiations part, what has been the difference in your average reimbursement

[00:31:34] per visit over the course of the last three years?

[00:31:38] About 10% increase or so.

[00:31:41] Yeah.

[00:31:42] About 10%.

[00:31:43] Yeah.

[00:31:44] Nice.

[00:31:45] That's awesome.

[00:31:47] Yeah.

[00:31:48] At least 10% from the numbers that I saw, I think it's at least 10%, right?

[00:31:53] We are kind of heavy Medicare.

[00:31:55] So we were, before these last, what, six years of cuts, we were around 100.

[00:32:02] Then it's been like steadily decreasing to the mid-90s.

[00:32:08] And now we're up to 106, 107, you know?

[00:32:13] And so, yeah, it's a little, around 10.

[00:32:17] Yeah.

[00:32:18] Awesome.

[00:32:18] And these are the things that you have to do as an owner to combat the inflationary pressures,

[00:32:22] the decreasing reimbursements and that kind of stuff.

[00:32:25] This is the kind of stuff that you got to start doing.

[00:32:28] You can't just sit by passively, idly by, and expect things to continue to go hunky-dory,

[00:32:34] right?

[00:32:35] I like, I would use, when I was explaining this to my staff, the watermelon truck story,

[00:32:41] you know, a man buys a truck and fills it with watermelons and goes and sells them for

[00:32:47] a dollar a melon and buys them from the grower for a dollar a melon, sells them to the customer

[00:32:54] for a dollar a melon.

[00:32:55] And isn't, you know, he looks back and says, man, I'm not doing so well.

[00:32:58] I haven't made any money.

[00:32:59] He said, I know the solution.

[00:33:01] I need a bigger truck.

[00:33:02] And so that is what you feel like when you're seeing some of these low payers.

[00:33:08] It's like, I just need to see more of these people.

[00:33:10] No, you don't need a bigger truck.

[00:33:12] Just sell your melons for more than they cost you to make.

[00:33:16] Right.

[00:33:16] Right.

[00:33:17] Exactly.

[00:33:18] Yeah.

[00:33:18] I love that you're ending on that story because that's the perfect analogy for our profession.

[00:33:26] Cool, man.

[00:33:27] Awesome.

[00:33:27] Well, thanks for sharing, man.

[00:33:29] I really appreciate you taking the time.

[00:33:31] This was awesome conversation.

[00:33:32] Thanks, Mark.

[00:33:32] You betcha.

[00:33:33] Thank you.

[00:33:36] Thanks for joining us today in the Physical Therapy Owners Club,

[00:33:40] the resource for stability and freedom in your PT practice.

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