There’s a good chance that as you read this during COVID-19 pandemic, you’ve got a pain in your neck, lower back pain or stiffness in one of your joints. Millions of people are experiencing new or increased back, neck, or shoulder pain since they began working from home because our homes are not necessarily designed to support long working hours.

Even before the pandemic, musculoskeletal (MSK) conditions have been the leading cause of disability in the United States (US), affecting one in two adults.

The evolving work-from-home economy is likely to increase this number in a significant way. For self-funded employers and health plans, this means escalation in cost attributed to musculoskeletal (MSK) pain. MSK is already one of the top cost categories for many employers, costing as much as 15%-20% of the overall health spend. Majority of MSK spend (82%) is on surgeries, and associated imaging. Given that our healthcare system is highly fragmented, medicalized, interventional, volume-driven with huge price variation between providers – over 50% of the musculoskeletal spend is wasted. The employers and health plans are getting poor return on their musculoskeletal investments.

It does not have to be like that. Conservative treatments such as physical therapy, chiropractic care and other rehabilitation services can effectively address the pain and functional limitations that typically accompany MSK conditions. For example, research has shown that early physical therapy intervention is associated with faster healing, reduced health care utilization and reduced overall health care costs.

Despite evidence and proof points, employees often don’t seek out the conservative musculoskeletal services as often as they should, nor are they encouraged by many primary care physicians or specialists to explore such options. That’s why it is not uncommon for people to start the therapy for back pain after 5 months from onset of pain, or 3 weeks after ankle sprain.

In addition to lack of awareness, access to conservative care is often made challenging due to many barriers. In-person care is limited to 9-5 schedule, 5 days a week. There is a wait for initial appointment, and since physical therapy or chiropractic manipulation regimen require frequent visits – taking time off work, travel and arranging for child care is not realistic. On top, the strange out-of-date benefit plan designs make out-of-pocket costs (for therapy) prohibitive for employees. Employees are often unaware of changes in their benefit plans from year-to-year, particularly for unexpected new onset conditions.

Physical therapy coverage in health plans

Physical therapy helps injured employees improve movement and manage pain. It is often an important part of preventive care, rehabilitation, and treatment for members with chronic musculoskeletal conditions, illnesses, or injuries. Most health plans in United States pay for physical therapy services that are medically necessary and that are provided by or under the direction and supervision of a physical therapist. 

However just because the health insurance plan covers physical therapy doesn’t necessarily mean that the plan will pay 100% of charges when an employee gets the treatment. In many cases, employees still have to pay a deductible, a co-insurance, or a copayment. 

How much does physical therapy really cost?

If your health plan covers physical therapy, the amount of money you or your health plan will spend depend upon a number of variables including

  • The type of therapy
  • The length of each therapy session
  • # of sessions
  • Your provider
  • The setting of service
  • Medical supplies or equipment

The cost of physical therapy can easily add up since it is not something that works in one visit but usually requires several visits. Obviously if your rehab requires more visits, you will end up paying more and yes, there is variation in pricing between providers.

The setting of service is very important to know. Physical therapy in a hospital setting will cost more than in the clinic. Digital (virtual or remote) physical therapy is the lowest cost option. Medical supplies is another cost component. No different than how you pay for a chocolate in the hotel room’s minibar. Same product, but much higher cost if you purchase it in the clinic vs. buying it from Walmart.

If you’re going to pay out of pocket for physical therapy, expect to pay an average of $125 per session. This is not the entire story though. While physical therapy is not much expensive on a per session basis, it is not cheap when you add the overall cost for the duration of the treatment and the numbers quickly add up. According to The American Physical Therapy Association (APTA), physical therapy for chronic or lower back pain costs $126 per session with most spending between $1,000 and $1,260 for around 8 to 10 sessions of treatment over six weeks. Another study from 2015 showed that members could pay $2,807 to $3,376 for up to 36 PT appointments following rotator cuff surgery.

Is physical therapy still worth it?

Absolutely yes. For 90% of MSK conditions, physical therapy is the right place to start. The clinical diagnostic accuracy by physical therapists matches with the orthopedic surgeons on patients with MSK injuries, at 1/25th of the overall episodic cost (when measured over 12 months).

For the remaining 10% cases, physical therapists can provide the assessment, guidance and triage to the right alternative treatment.

Physical therapists are also more accessible. It takes 1-2 days to schedule an appointment with physical therapist vs. 1-2 weeks with a PCP or a specialist.


Why aren’t health plans and employers making therapy services more accessible — despite the overwhelming evidence that physical therapy is both clinically effective and cost-efficient?  After all health plans, employers and providers want the same thing – to help members achieve optimal health outcomes and avoid dangerous, costly treatment that could result in further complications down the road. 

This accessibility problem is a result of poor health plan designs that have been carried over from time immemorial. In particular, cost-sharing requirements imposed by the health plan often do not reflect the true value of different treatment options available. Making high-value musculoskeletal services more accessible requires health plans to get rid of the legacy barriers that are getting in the way.

Barrier 1: Deductible

The deductible is the amount a member pays out of pocket before her health plan will cover any portion of her physical therapy visits. Let’s say your plan’s deductible is $1500 and you visit your physical therapist six times within the first two months of health plan enrollment, and the allowed amount paid to physical therapist per visit is $300. In this hypothetical scenario, you will have to pay the full bill for the first five visits and less for the sixth (copay and coinsurance may still apply after you have met the deductible).

From a health insurance perspective, it may make sense that when members are the first party to the loss (insurance jargon) in form of deductible, they will be very selective in using health care and pick only high-value. However research has proven time and again that deductibles get in the way of high-value care (for example preventive care or using PT for musculoskeletal conditions) as much as low-value care (for example visiting ER for low acuity back pain). When in doubt people stay away from both high-value and low-value care. Also because deductible resets every year, for someone who has been carrying pain from previous plan year faces enormous barrier in a new plan year, which does not make any sense. This poorly implemented plan design concept encourages some people to make irresponsible decisions after their deductible is met.

Barrier 2: Copay

A copay is a flat fee you pay for each visit. Your health plan determines the copay amount that you pay for each physical therapy session. Over the last few years, in an effort to keep member insurance premiums low—health plans have shifted a greater portion of the physical therapy cost to the member. As a result, copays have steadily increased.

The right copay for physical therapy is between $0 and $20 and members with copay over $30 are 29% less likely to see the PT than the ones with $0 copay.

Unlike regular physician visits, physical therapy regimen requires multiple visits based on the type of injury or pain. Having a high copay (over $20 per session) end up discouraging members from seeking rehab therapy care due to the high overall out-of-pocket cost.

As a result, this makes it harder for members with musculoskeletal conditions to achieve optimal care outcomes—which ultimately leads to poorer overall health.

Barrier 3: Coinsurance

The coinsurance is a type of out-of-pocket payment that is calculated as a percent of the total allowed amount for a particular service. It’s the member’s share of the total cost. For example, let’s say:

  • your health plan’s allowed amount for a physical therapy session is $200;
  • you have already met your deductible
  • you are responsible for a 20% coinsurance.

In this scenario, you will owe $40 at the time of service, and the health plan would pay the rest of the allowed amount for that visit. Coinsurance amounts may vary from visit to visit—depending on what services you will receive and that’s what the problem is.

Unfortunately you don’t always know in advance what services you will be receiving in any visit and hence you have no idea what % of what amount you’ll be responsible for. It is only after the visit, the services (and devices, products) are added to the provider’s claim, which is sent to health plan for adjudication, a managed care discount is applied, a cryptic EOB (explanation of benefits) is generated and sent to you 1-2 months after the visit with some details on what you owe.

Co-insurance is a simple concept to understand, but because of the way services are priced and paid, it is not transparent and discourages people from adhering to their treatment plan.

Barrier 4: Arbitrary Limits

Most health plans place a limit on the number of physical therapy visits (typically 20 visits) they’ll cover in a benefit period. The main idea behind this is to reduce inappropriate utilization. However this idea is fundamentally flawed.

These arbitrary limits per year do not account for initial diagnosis or severity, variability in rehabilitation progress, or complications. The number of sessions (and recovery time) you need depends upon the type of injury, complications and severity. 8-10 sessions may be good enough to recover from knee replacement but physical therapy for rotator cuff injuries can take as many as 30-40 visits over 3 – 6 months of recovery.

Some health plans put a combined limit across multiple unrelated services that includes physical therapy, speech therapy, pulmonary rehabilitation etc. This is really a dumb idea when you think about the plan design from a member’s perspective.

Instead of imposing an arbitrary limit, the benefit plan’s coverage should be designed to facilitate restoration of function. An appropriate physical therapy benefit should include the care coverage that allows an individual to return to his or her previous level of function.

Barrier 5: Referrals

Even though the physical therapy as the first line treatment provides the highest level of diagnosis for over 90% of musculoskeletal (MSK) issues and most states now permit direct access to licensed physical therapists for evaluation and treatment without a referral from a physicians, less than 10% of visits for first line treatment are made to PT.

Most members go to PCP, specialists or ER/Urgent care for first line treatment which initiates diagnostic testing, follow-up visits, medication prescriptions, and then finally a referral to a physical therapist. These visits and tests, as well as the pain medications delay the start of rehabilitation, ultimately hindering care.

On the contrary, requiring a physician referral for physical therapy services for a primary MSK complaint actually increases costs. Not all PCPs are up-to-date with latest in musculoskeletal care and the referrals are often dependent on the physician’s knowledge and attitudes toward MSK evaluation and their interpretation of the clinical guidelines for involvement of therapy or rehabilitation services.

Barrier 6: Pre-certification or Prior Authorization

Pre-certification or prior authorization is a utilization management review decision where a health plan determines whether a therapist’s choice of treatment is the best decision for the member based on plan’s clinical guidelines.

The health plan guidelines may vary from one year to another and decisions on pre-authorization requests generally take up to 1-2 weeks. This slow archaic fax-driven process hampers member access to care and negatively impact member outcomes.

Instead of blanket policy where all requests have to go through pre-authorization, health plans can deploy machine learning tools to a) identify efficient providers from inefficient ones and b) high-value vs. low value services and c) allow efficient providers to prescribe high-value services without any prior authorization requirement.

Cook et al have demonstrated that patients who report 50% reduction in pain in the first 2 weeks of a PT plan of care have a significantly greater likelihood of reduced disability at 6 months. This logic can be applied to waive the need of pre-certification for the first 3 visits or 2 weeks of treatment. If the member needs additional sessions, the PT should be able to justify it based on the results from initial treatment. This collaborative relationship between therapist and health plan can improve the health care outcomes for the member.

Barrier 7: Inadequate coverage for digital musculoskeletal (MSK) care

Let’s accept it. The Monday through Friday, 9-to-5 model of in-person therapy that happens within the four walls of a physical therapist’s clinic was no longer working for the majority of people even before the COVID virus arrived. Virtual physical therapy, also known as remote, mHealth, e-health, mobile therapy is vital now, particularly given the challenges we face in healthcare today.

Virtual physical therapy is more convenient, accessible and effective than in-person alternative for most people. Members get care in a familiar setting with convenient hours and location. And when members and therapists are communicating, there’s always an opportunity to close loops if someone’s not doing as well as they should be.

In addition, the use of digital health technology addresses access issues due to distance, availability of providers and specialists, impaired mobility, and lack of transportation, especially for BIPOC population. In the virtual care model, the connection can be in “real-time” as a live interaction or asynchronous. Much more so than with traditional care, virtual musculoskeletal care includes a larger educational component. Because the therapist is not physically present to assist with movements or joint stabilization, the onus is much more on the member to learn these techniques and practice them continually.

Despite several years of pleading, it was only in march 2020, CMS and commercial payers decided to add virtual physical therapy to the list of services they would cover during the pandemic. The payments for such services at this time is kept the same as for an in-person visit. The health plans should ensure that this new model of member-centered care that leverages advanced cloud technology to deliver better health outcomes at a lower cost is covered in future on a permanent basis.


The right health plan design for an employer is not a cookie-cutter plan offered by the carrier, but a custom plan built around its employees – more specifically the condition and needs profile of its employee population. If an employer has high rates of MSK conditions in its population or if musculoskeletal spend is one of its top cost category, the health plan must cover high-value treatments that have proven to be effective for these conditions.

An effective plan design incorporates the principles of value to determine cost-sharing. The value is generally determined by the effectiveness of the procedure or treatment and benefit to the member in relation to overall cost. Value-based insurance design (VBID) is one such model that recommends lowering or removing financial barriers to essential, high-value clinical services and aligning members’ out-of-pocket costs, such as copayments and deductibles, with the value of services.

Amid an environment where there seems to be a high-dollar treatment for every musculoskeletal (msk) condition, it’s remarkable to consider that relatively low-cost and non-invasive PT is making such a mark on reducing healthcare costs. VBID encourages such low cost options prior to high cost ones (such as trying physical therapy for pain relief prior to having surgery).

A variation of this plan design is where pre-authorization and cost-sharing is waived for the first few visits. This breaks down the initial barriers for the member to access physical therapy in a timely manner. Examples of such plan designs are being tested by various organizations including TRICARE and United Healthcare among others.

TRICARE found out in their research that that rates of attendance to at least one physical therapy session varied significantly, ranging from active duty beneficiaries at a 65% attendance rate to non-active duty dependents only reaching 38% attendance. The low-attending group happens to have the highest cost-sharing requirements for physical therapy. The experiment of cost-sharing waivers is based on an assumption that it could help to increase participation in “high value” treatment for low back pain.

In the United Healthcare model, the physical therapy is offered in a bundle “PT bundle”. Any member with a documented diagnosis of low back pain is eligible for receive up to three PT sessions for a single copay, which is comparable to the typical copay amount for a single PT session.

The value-based PT bundle approach with either waiving cost sharing or a single copay for the bundle represents an innovative application of the principles of VBID focusing on enhanced access to a potentially high-value but underutilized treatment option to treat musculoskeletal conditions that are prone to unnecessary and avoidable care.

Sprite Health’s corporate musculoskeletal program provides a single point of access for all MSK conditions, across the entire MSK continuum. Our virtual physical therapy services provide a more affordable and convenient way to prevent and treat pain. Chronic pain management provides an evidence-based, PT-led digital program for chronic joint and back pain that includes personalized exercise therapy, behavioral health support, education & guidance. Bundled surgery provides access to high-quality musculoskeletal surgical care at a pre-negotiated bundled rate. MSK financial management leverages predictive analytics, clinical expertise and plan administration capabilities to eliminate waste – resulting in over 30% net savings in your MSK spend.

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