3 Pricing Psychology Tips for a Cash Based Physical Therapy Practice

The psychology of pricing is often more important than the actual pricing. Bottled water is a classic example. Water is a commodity. Fill a cup from your kitchen sink and pay $0.05. Pour the same water from a plastic bottle and pay $2. Buy that same plastic bottle at a concert or baseball game and pay $5. 

Pricing Psychology Tips for a Cash Based Physical Therapy Practice can not only help more prospective patients understand the value in the service, but it might also improve outcomes for those clients.

1. High Price Buy-in, Low Cost Follow Ups

When I look at what I believe to be the most valuable part of what I do as a physical therapist, I believe it is the initial evaluation, developing the plan of care, and establishing goals.

I love the high price buy-in because it rewards me for what I believe is the most important part of what I do, then the low cost follow-ups reward my patient for investing in themselves.

A popular way to make this pricing psychology work for a cash based physical therapy practice is to establish your average plan of care duration and determine what the price would be for a CashPT model. For example, if an average CashPT sees a patient for $150 per session and an average plan of care duration of 6 visits, the total cost is 6 x $150 = $900.

In a case like this, I might choose to set my initial evaluation rate at $500 and follow up visits at $80. In this case the same 6 visit plan of care would cost $500 for the first session plus 5 x $80 for follow up sessions totalling the same $900.

The pricing psychology here is one in which the consumer paid a premium for the right to receive a $70 per visit discount on all follow up care. The consumer also is less incentivized to quit early because of the initial upfront investment. 

2. Selling a Plan of Care vs Selling Visits

I prefer to hire professionals and pay for the outcome or pay for the job rather than paying for the time. If I need legal documents drafted I would like to just pay a flat rate rather than paying by the hour. When a plumber comes to my home I want to know a flat rate for what the job will cost rather than feeling like I am paying by the minute and the slower the plumber works the more it is costing me.

Selling a plan of care allows both you and your patient to elliminate any doubt in the process. Your patient will pay for the program then focus on achieving results.

3. Price Benchmarks

If your patient doesn’t have a framework to compare the cost of your service there is no way to determine if it is expensive or affordable.

Here in Middletown, OH a local hospital has publicly posted patient pricing for physical therapy services. The price of an initial physical therapy is over $600. I can create a comparison chart upon which I list the hospital’s publicly posted price of $600 compared to my price of $200.

Even if my prospective client would have considered $200 expensive in the first place, after seeing the hospital’s price of $600, my price now seems affordable.