How to Pay Your Therapists Without Hurting Your Group Practice

One of the biggest decisions you'll make as a group practice owner is determining how much to pay your therapists. It's a critical step, but before you set a rate, there's an even more important question you need to answer:

How much does your business need to make to run successfully?

I know it sounds a little backwards, but trust me—it’s a game changer. Before you can offer a competitive rate to your therapists, you need to have a clear understanding of your practice’s financials.

Why This Matters

Too many practice owners set therapist rates based on what feels fair or what competitors offer, without first ensuring their business can sustain those numbers. Here’s why getting clear on your financials is essential:

1. Your Business Needs to Be Sustainable

You can't offer great pay if you’re not clear on your revenue needs and expenses. Your rates should cover not only therapist salaries but also overhead costs, business growth, and a profit margin that ensures long-term success.

2. Avoid Financial Stress

The last thing you want is to offer a rate that sounds good in the moment but leaves you scrambling to pay bills at the end of the month. Understanding your financial needs helps you set fair rates while keeping your business healthy.

3. Set Yourself Up for Long-Term Success

If you don’t take the time to get clear on your numbers, you’re risking burnout—yours and your therapists’. A financially sound practice allows you to grow your team without putting your own well-being or the stability of your business at risk.

Getting Clear on the Numbers

Before setting therapist pay, ask yourself:

✅ What’s my monthly revenue goal?
✅ What are my business expenses?
✅ What’s my desired profit margin?

Once you have these numbers, you’ll know exactly what your practice needs to sustain itself while offering fair, competitive pay to your therapists.

Final Thoughts

I’m not saying you shouldn’t pay your therapists well—absolutely, you should! But setting rates without understanding what your business truly needs can lead to financial instability.

By getting clear on your financials, you’re not just ensuring fair compensation—you’re building a practice that is healthy, sustainable, and positioned for long-term growth.

What financial steps are you taking to ensure your practice thrives while paying your therapists fairly? Let’s discuss in the comments!

PS If you’re ready to ensure that you are offering the right pay for your therapists, why not join us in The Group Practice Connection? This is a community of like-minded group practice owners working together to ensure our businesses are run smoothly and efficiently. Part of what we work through is confidence in numbers and looking at metrics. Check it out here!