How to Price CPT Codes for Your Cash-Based Physical Therapy Practice
By: Maggie Bergeron, PT, Co-Founder ∙ Estimated reading time: 8 minutes

Disclaimer: This blog post is intended as a general educational resource for physical therapists and practice owners. Pricing decisions, billing practices, and reimbursement rules are complex, vary by location, and change regularly. Always conduct your own research, consult with a qualified billing specialist or healthcare attorney, and verify current rates directly with CMS and relevant payers before setting your fee schedule.

Introduction: The Question Every Cash-Based PT Asks

You've set up your cash-based practice, you're generating Superbills for your patients, and everything is going smoothly — until someone asks: "How much should I charge per CPT code?"

It's one of the most common questions we hear from physical therapists running cash-based practices in the United States, and it's surprisingly hard to find a clear answer. That's because, unlike insurance-based billing, there's no single authority telling you what to charge. But there are clear frameworks, benchmarks, and best practices that can guide your pricing.

In this post, we'll break down exactly how CPT code pricing works for cash-based practices, what benchmarks to use, and how to set a fee schedule that keeps your practice profitable while remaining fair to your patients.

What Are CPT Codes — and Do They Come With a Price Tag?

CPT (Current Procedural Terminology) codes are five-digit standardized codes maintained by the American Medical Association (AMA) that describe specific medical services and procedures. Physical therapists use them to document and communicate exactly what care was delivered.

Here's the key thing to understand: CPT codes don't come with a fixed price for cash-based practices. They are labels, not price tags. As a cash-based provider, you are not bound by insurance contracts, which means you have the freedom — and responsibility — to set your own fee schedule.

This is actually one of the biggest advantages of running a cash practice. You're not subject to the year-over-year reimbursement cuts that insurance-based practices face. However, it does mean you need a thoughtful approach to pricing.

Step 1: Use Medicare Rates as Your Baseline Benchmark

The most widely used reference point for CPT code pricing is the Medicare Physician Fee Schedule (MPFS), published annually by the Centers for Medicare & Medicaid Services (CMS).

Even though cash-based practices don't bill Medicare directly, most practitioners in the industry use Medicare rates as a benchmark. It's the most transparent, publicly available pricing reference available, and it gives you a consistent foundation to build from.

How Medicare Rates Are Calculated

Medicare reimbursement is based on Relative Value Units (RVUs) — a system that assigns a numeric value to each CPT code based on the time, skill, and resources required to deliver that service. That RVU value is then multiplied by a conversion factor set annually by CMS.

For 2026, CMS has approved a conversion factor of $33.40 — a roughly 3.26% increase over 2025's rate of $32.36, which is welcome news after several years of consecutive cuts.

Important: Medicare rates vary by geographic location (called "MAC localities"). A unit of 97110 (Therapeutic Exercise) may reimburse differently in San Francisco than in rural Kansas. Always check your local rate using the CMS Medicare Physician Fee Schedule Lookup tool.

Approximate 2025 Medicare Rates for Common PT CPT Codes

The table below shows approximate national non-facility Medicare reimbursement rates. These are for reference only — always verify current rates directly with CMS.

Rates are approximate national averages and subject to change. Verify current rates at cms.gov.

What Cash-Based Practices Actually Charge

Cash-based practices typically charge 1.5x to 2.5x Medicare rates, sometimes more in high cost-of-living markets or for highly specialized services. The rationale is straightforward: you're offering more personalized, one-on-one time, there's no insurance overhead, and you're not losing revenue to contractual adjustments.

Step 2: Calculate Your Cost Per Visit

Before finalizing any prices, you need to know your cost per visit — the true floor below which you can't sustainably operate.

To calculate it:

1. Add up all your monthly expenses: rent or mortgage, utilities, software (like your practice management system), payroll (including your own), supplies, malpractice insurance, continuing education, marketing, and any other overhead.
2. Divide by the number of patient visits you see per month.

The result is your average cost per visit. Your prices must exceed this number to generate profit. From there, you can set your fee schedule with a clear margin built in.

This step is often skipped, and it's why some cash-based practices undercharge and struggle to stay afloat despite being fully booked.

Step 3: Build a Proper CPT-Based Fee Schedule (Don't Invent Your Own Codes)

One of the most common mistakes cash-based therapists make is creating their own pricing structure — charging a flat rate for "a 30-minute session" or "an hour of PT" without referencing CPT codes at all.

This creates problems for your patients. When a patient tries to submit a Superbill to their insurance company for out-of-network reimbursement, the insurer needs to see recognized CPT codes and corresponding charges. If your fee schedule doesn't align with those codes, the claim becomes harder — or impossible — to process.

The best practice is to price each CPT code individually and bill accordingly. For example:

• Initial evaluation (97162): $175
• Therapeutic Exercise, 2 units / 30 min (97110): $70
• Manual Therapy, 2 units / 30 min (97140): $68

A typical 60-minute treatment session might include 2–4 CPT codes across several units, so your total session charge is simply the sum of the codes delivered.

Step 4: Understand Timed vs. Service-Based Codes

Not all CPT codes work the same way, and understanding this distinction is essential for accurate billing.

Timed (Time-Based) Codes

Most PT treatment codes — like 97110 (Therapeutic Exercise), 97140 (Manual Therapy), and 97112 (Neuromuscular Re-education) — are billed in 15-minute units. The 8-Minute Rule applies: to bill one unit of a timed code, you must provide that service for a minimum of 8 minutes.

Service-Based (Untimed) Codes

Evaluation codes — 97161, 97162, and 97163 — are billed once per encounter, regardless of how long the evaluation takes. The complexity level (low, moderate, high) is determined by clinical factors, not time.

Step 5: Research Your Local Market

Medicare rates and your cost-per-visit calculation give you a floor and a framework, but ultimately your prices should also reflect what your local market will bear.

Factors to research in your area:

• What are other cash-based PT practices charging?
• What is the average household income in your area?
• What out-of-network PT rates do common insurance plans in your region set?
• Are you offering a specialized service (e.g., pelvic floor PT, vestibular rehab, sports performance) that commands a premium?

Pricing too low can actually undermine perceived value — patients often equate price with quality, especially for out-of-pocket services.

What Patients Need to Know About Reimbursement

When you hand a patient a Superbill, they'll often ask: "How much will I get back from my insurance?"

The honest answer is: it depends entirely on their individual plan. Reimbursement is driven by:

• Their out-of-network deductible — if they haven't met it, the full payment may apply to the deductible rather than triggering a reimbursement payment
• Their out-of-network coinsurance — e.g., insurance pays 70%, patient pays 30% after deductible
• Their plan's "allowable amount" for each CPT code — this is what the insurer considers a "reasonable" charge, often pegged to a percentage of Medicare rates

A patient with a high deductible may not receive a reimbursement check — but their payments still count toward that deductible, which can matter later in the year if they need other care.

We recommend encouraging patients to call their insurer before their first visit to ask about out-of-network physical therapy benefits. You can even provide a simple worksheet to help them ask the right questions.

Setting Up Your CPT Code Prices in Embodia

If you're using Embodia to generate Superbills, you can add your CPT procedure codes and set your unit price for each one directly in your account. 

You can also create Service Defaults — preset bundles of the CPT codes you typically use for a given service type — so that generating a Superbill after a session takes seconds, not minutes.

For a step-by-step setup guide, visit: Setting Up Superbills on Embodia

Key Resources for Staying Current

CPT codes and Medicare rates are updated annually. Here are the most reliable sources to bookmark:

• CMS Medicare Physician Fee Schedule Lookup: cms.gov/medicare/physician-fee-schedule/search
• American Physical Therapy Association (APTA): apta.org — publishes coding guides and billing updates for members
• Strata PT Medicare Fee Calculator: stratapt.com/medicare-fee-calculator — useful for looking up locality-specific rates
• AMA CPT Code Updates: ama-assn.org — annual updates to the CPT code set

Summary: How to Price CPT Codes in 5 Steps

1. Use Medicare rates as a benchmark — they're publicly available, widely used as a reference, and give you a defensible starting point
2. Calculate your cost per visit — know your floor before setting any price
3. Build your fee schedule around actual CPT codes — don't create your own session-length codes
4. Understand timed vs. service-based codes — bill units correctly to reflect what was actually delivered
5. Check your local market — adjust for geography, specialization, and what patients in your area are accustomed to paying

Cash-based practice gives you the freedom to price your services in a way that truly reflects the value you deliver. With the right framework, you can build a fee schedule that's competitive, sustainable, and easy for patients to use when submitting to their insurance.

Have questions about setting up Superbills or CPT codes in Embodia? Visit our Help Center or reach out to our support team at support@embodiaapp.com 

Related reading:

• A Beginner's Guide to Superbills & Receipts for a Cash Practice
• A Superbill Glossary for Physical Therapists