Do you dream of starting a physical therapy business after graduating from a Doctor of Physical Therapy (DPT) program? Compared to working as an employee in a clinic, owning a private physical therapist practice gives you more autonomy, helps you grow as an entrepreneur and clinician and offers the potential for higher income.
However, starting a physical therapy practice also means putting in longer hours, filling out more paperwork and learning a business skill set on top of your clinical skill set. You don’t have to do it all by yourself; you can get advice from your mentor and hire experts.
Can physical therapists own practices? Sure. Here’s a detailed (but by no means comprehensive) map of how to open a physical therapy clinic.
1. Research the market1
Before starting a physical therapy business, research who your patients would be. Ask yourself the following questions about where you’ll be offering your services:
- Who needs physical therapy in your area (and what are their age range and occupations)?
- Why would they need it (what are the acute and chronic conditions they’re dealing with)?
- What types of PT would they need (such as manual techniques or stretching and strengthening exercises)?
You can survey prospective clients directly. Ask them what it would take for them to choose your physical therapy business.
Also, check out your competitors: their size, structure, locations, services and length of time in business. What can your physical therapist business offer that is different or better than what they provide?
2. Choose your niche
In a private physical therapy business, do you intend to focus on sports injuries, workplace injuries, pediatrics, geriatrics, post-surgical rehabilitation, chronic pain or other PT specialties? Will your PT practice emphasize manual physical therapy, PT modalities, stretching and strengthening or all of the above?
Also, determine if your physical therapy business will be staffed solely with physical therapists or will you bring in other rehabilitative science practitioners? That might include other healthcare professionals such as occupational therapists and speech-language pathologists within your interprofessional care team.
3. Decide on the business structure
Are you starting a physical therapy business on your own? Or would you prefer to work with other physical therapists, open a franchise or purchase an existing private practice in physical therapy?
Another option for how to start a physical therapy business is partnering with a gym or a large corporation that wants to offer PT onsite. You could consider offering virtual physical therapy services, too.
Research the options and their tax implications. You could set up your PT business as a sole proprietorship, a PLLC or an S corporation.2,3,4
4. Choose the method of compensation5
Will your physical therapy business be cash-based or insurance-based? If you choose the latter, research the insurance contract terms with each provider.
Also, will your office manager handle billing or will you use a third-party service? There are pros and cons to each option, so do your homework.
5. Develop a marketing plan6
Starting a physical therapy business can begin with choosing a business name and getting a logo and business cards designed. Map a strategy involving digital channels such as a website, social media and a blog.
Don’t forget print materials like brochures and postcards and, if feasible, place radio or television ads. Consider creating a customer incentive or loyalty plan.
Meet with local physicians to let them know about your services. Make it easy for them to schedule patients with you.
6. Develop a physical therapy business plan
A business plan serves as a roadmap for the growth and evolution of your physical therapy business. It can help you secure funding and keep you on track with your milestones.7
It should describe the following:
- Your services
- Your market research
- The competitive landscape
- Your marketing plan
- Operational details
- Your management team
- A first-year budget
- Details about compensation
- A financial summary
When going through this process of how to start a physical therapy business, include costs for insuring your clinic.
7. Secure financing8
Once you plan for a physical therapy business, secure loans or investments from banks, angel investors, family members and friends. Consider crowdfunding, with incentives (such as free PT treatments) for each level.
Other options include borrowing money against your retirement accounts or taking out a second mortgage—but be careful not to get in too deep.
8. Determine your location
Start looking for a space for your physical therapy business after you know how much startup money is available. Think about factors such as:
- Visibility
- Proximity to potential referral sources (e.g., doctors and fitness centers)
- Ease of parking
- How much space you need (with room to grow)
- Length of lease
- Too-close proximity to competitors
- Necessary renovations now or down the road
9. Fill out necessary paperwork
Set up a professional limited liability company (PLLC) or another business structure. Get your EIN from the IRS, make sure your PT license is up to date, purchase professional liability insurance coverage and set up a business bank account and credit card.
Consult with an attorney to make sure you understand how to start a physical therapy business that adheres to HIPAA standards.9 Also, you will need to prepare documents for your patients to fill out: medical histories, insurance forms, pain maps, HIPAA disclosures, etc.
10. Begin searching for and hiring staff
Spread the word that you’re starting a physical therapy business to your former classmates and colleagues who are physical therapists. Gauge their interest in joining your practice and ask them for referrals.
Even if you know them personally, vet candidates through an extensive interview process, background checks, etc. When starting a physical therapy business, hire an office manager who is competent, kind and friendly and who can be the face of your practice.
Consider hiring therapists and staff from different socioeconomic backgrounds, races, cultures, genders, sexual orientations, religions, and ethnicities to promote diversity in healthcare and increase relatability with patients.
11. Design the space
A professional architect and designer will help you maximize your square footage while capturing your vision of your physical therapy business. Plan the floor layout for a positive environment and efficient patient flow. Consider your color scheme and whether images on the walls will relate to physical therapy or be more abstract.
12. Purchase equipment
When starting a physical therapy business, list the equipment you will need. Your list might include hi-lo treatment tables, ultrasound units, TENS units, laser therapy units, exercise balls, resistance bands, weights and more. Also, purchase new computers and comfortable furniture.
13. Find the right software
To keep track of patient scheduling, records and billing, consider software programs such as:
- An electronic health record system
- A patient portal
- A payment platform
- Scheduling software
- Accounting software
- Customer relationship management software
Hire an expert to get your IT system up and running for your physical therapy business.
14. Celebrate
You’re almost ready to open the doors to your physical therapy business. It’s been a lot of work, but you are gaining valuable skills and knowledge. You’re about to enjoy the rewards of career autonomy and ownership.
The largest PT school in the United States*, the University of St. Augustine for Health Sciences (USAHS) offers a hands-on Doctor of Physical Therapy (DPT) degree. Practice with mock and real patients in our state-of-the-art simulation centers and learn anatomy with our high-tech tools. Prepare for clinical practice with a wide range of patients, as well as advanced roles in research, practice leadership and policymaking. Residential and Flex paths are available.
*Based on total DPT degrees conferred during 2020-2022, as reported by the Integrated Postsecondary Education Data System (IPEDS). Data is captured by IPEDS through interrelated surveys conducted annually by the U.S. Department of Education’s National Center for Education Statistics (NCES). https://nces.ed.gov/ipeds/
Sources
- U.S. Small Business Administration, “Market research and competitive analysis,” SBA, 2024, https://www.sba.gov/business-guide/plan-your-business/market-research-competitive-analysis.
- IRS, “Sole proprietorships,” IRS, March 28, 2024, https://www.irs.gov/businesses/small-businesses-self-employed/sole-proprietorships.
- Priyanka Prakash, “PLLC: The Complete Guide to a Professional Limited Liability Company,” NerdWallet, October 28, 2020, https://www.nerdwallet.com/article/small-business/professional-limited-liability-company.
- IRS, “S corporations,” IRS, May 9, 2024, https://www.irs.gov/businesses/small-businesses-self-employed/s-corporations.
- American Physical Therapy Association, “Payment,” APTA, 2024, https://www.apta.org/your-practice/payment.
- U.S. Small Business Administration, “Marketing and Sales,” SBA, August 30, 2023, https://www.sba.gov/business-guide/manage-your-business/marketing-sales.
- U.S. Small Business Administration, “5 reasons you need a business plan,” SBA, December 10, 2018, https://www.sba.gov/blog/5-reasons-you-need-business-plan.
- U.S. Small Business Administration, “Fund your business,” SBA, May 14, 2024, https://www.sba.gov/business-guide/plan-your-business/fund-your-business.
- U.S. Department of Health and Human Services, “HIPAA for Professionals,” HHS, May 17, 2021, https://www.hhs.gov/hipaa/for-professionals/index.html.
