Physical therapists who are in the market for a software billing and practice management system have many choices. They may opt to pay a one-time fee, or seek out companies that license software systems by the user or by the computer. One company charges users per patient treatment, which could be cost-prohibitive for some practices over the long term. The 2009 American Physical Therapy Association (APTA) annual private practice section meeting in Colorado, where the exhibit hall was dubbed “software hall,” featured dozens of programs designed by PTs for PTs. Comparing features and prices, and considering governmental factors and reimbursement requirements, may seem daunting. Buyer’s remorse is futile once you ink a contract and share your data, so choose wisely.


Hospitals have relied on computerized billing for decades. Craig Hospital (, Englewood, Colo, has billing systems that capture all tests and treatments performed on patients to produce bills for government and insurance payors. Implementing a computerized system that creates “clean bills” was a team effort among clinical staff, who clinically interpret regulation changes; billing staff, who produce bills that are compliant and will not get rejected; health information management staff, who code bills; and IT people, who create a user-friendly end-product, says Julie Keegan, the hospital’s VP of finance. Craig adopted their current system over the past 12 months. One vendor supplies billing and clinical documentation, and ties the whole system together.

“With a computerized system, you can build in profiles,” says Keegan. “For example, if there are 20 fields that you want to make sure are squeaky clean before a claim is transmitted, you build in those 20 fields in the computer and then the computer won’t allow the bill to drop until those are all complete.” The facility, which treats patients with spinal cord injury and traumatic brain injury, staffs approximately 30 occupational therapists, 30 PTs, 12 to 15 speech pathologists, 25 respiratory therapists, and about 10 full-time recreation therapists. At any given time, it serves about 80 inpatients and about 50 outpatients.

Billing and coding managers stay current with never-ending changes in regulations. Many hospitals rely on vendors for alerts trumpeting changes. “You can subscribe to newsletters so you get alerts from various vendors, and then you have dedicated staff who read those newsletters and change the billing systems accordingly,” says Keegan. “The hardest part isn’t changing it in a computer, it’s then retraining the staff. You’ve got to meet with each person and make sure they know the change.”

Some therapy treatments are billed based on time periods, others by episode. Some cases—in which Medicare requires bills to be based on time—are not as easily protected by the system as others, because the system does not know if a therapist set the timing right or wrong, says Keegan.

“If you’re talking about doing 50,000-plus treatments every year for the next 20 years, that’s a big chunk of money just toward the software,” says Kevin Hulsey, PT, DPT, who has been in practice for 10 years and operates RehabAuthority (, a large outpatient orthopedic practice comprising 10 clinics scattered across Idaho and Wyoming. It specializes in spine care, furnishing the aforesaid 50,000 treatments a year. (Hulsey had earlier created a PT billing/collecting company, and sold it.) Software consumers must also employ people or contract with others to make the software work.

For its first 7 years in operation, RehabAuthority used a basic, cost-effective software system tailored to small clinics, with “small expectations,” says Hulsey. It provided documentation, billing, collections, and a scheduling program. The practice found some aspects cumbersome and slow, and it was not network-friendly, so they sought an alternative, eventually choosing to take it in-house.

“If you have visions of having a large company, and if you have a vision of doing things your way—I am in favor of creating a software for yourself,” says Hulsey. The practice began building its current system some 5 years ago. Each component was created in consultation with system users: billing and collection staff members and documentation tapped PTs’ input; front office coordinators created prompts and data entry pages; and reports were created by Hulsey, the operations officer, and the controller. The programmer updates and revises the software as needed.

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The practice invested about $30,000, and the billing company invested $30,000 “to create this product that we will have forever,” says Hulsey, who calls the move “cost-effective.” The data collection software provides an initial evaluation, 700/701 reports, plans of care, progress notes, discharge summaries, interdisciplinary communications, physician’s communications, basic orthopedic outcome measures, Oswestry disability indexes, and neck disability indexes. The software cannot communicate directly with insurance companies’ computers, but an intermediary software bridges that gap, says Hulsey. Since beta testing, the new system has been up and running in all of the sites for about a year and a half.

Testing and implementation struggles yielded some delayed payments. “Our collection percentage had overall dropped about 14% during this process, and it was a really tough go in ’07 and ’08 while this thing was working itself out,” Hulsey says. “Fortunately, things corrected in ’09, and we were able to get those monies back. Now, things are rolling.”

Being able to build in a range of prompts has made a significant difference in the billing and collection, the consistency, and the continuity, says Hulsey. Benchmarks trigger prompts when actions stray outside norms—ie, when patients’ authorizations and verifications are due, if a patient has not been in for a week, or is scheduled less than three times a week. Across the exercise-based physical therapy practice, clinicians average 4.2 units of charges per treatment. Should patient charges be entered at less than four units or more than five, prompts are triggered. Clinicians are prompted to make sure plans of care are sent and collected within a 30-day window, and front office coordinators are prompted daily about this.


Hulsey scoured year-end numbers for 2009, concentrating on the referral summation sheet, which lists physicians who referred patients to the practice; how many patients they sent; how many visits, how much insurance billing, and how much patient payment was generated; and total charges. Noting that the numbers were a little off, he discovered that patients who had direct access, without a referral, were being left off of the report. Within an hour, the programmer updated the report to include a field for those who had self-referred.

Outcomes are a hot topic in the industry. The APTA system includes outcomes studies. “For us, it’s garbage in, garbage out,” says Hulsey. “We have such a hard time getting the results.” To be useful, outcome measurements need complete data—measurement before and after clients have completed care. “We’re over 90% collection rate on that first disability score, and we’re at 40% on the back end,” says Hulsey. Among the roadblocks—people who self-discharge or physicians who discharge patients before the last visit, and front office personnel who make data entry errors or forget to enter data.

The practice has an electronic health record and the system is Web-based. Many insurance companies accept electronic signatures, but others require hard documents with a legitimate signature. The practice is partnering with a software company in Burlington, Ontario, to electronically store all documents that require signatures, so they interface with the system. They have not tried electronic scheduling, but are in the process of building it and plan to have it finalized within the next quarter.

Hulsey looks to the future, when physical therapy and health care IT may force all health care records to interact with each other to streamline the process. “Physical therapy is an important player in the health care game, and we continue to be a very small player in the health care game—consequently, we end up riding the coattails of the physician practice. If we are going to insure 30 million more Americans who are going to be seeking health care, we’re going to have to be more efficient.”

Judy O’Rourke is associate editor of  Rehab Management. She can be reached at .