How Physical Therapy Can Cut Healthcare Costs — and Why Insurers Should Invest in It

Healthcare costs continue to rise year after year, placing enormous pressure on patients, providers, and insurers. As policymakers and insurance companies look for solutions, one highly effective — yet often underutilized — strategy lies in physical therapy.

Physical therapy isn’t just about restoring movement after an injury. It’s about preventing unnecessary surgeries, reducing reliance on long-term medications, and getting patients back to life faster. Investing in PT early doesn’t just improve patient outcomes — it saves the healthcare system billions.

The Rising Cost of Healthcare

In the U.S., chronic musculoskeletal conditions like low back pain, shoulder dysfunction, and osteoarthritis are among the leading drivers of healthcare spending. Consider this:

• Low back and neck pain alone account for over $134 billion annually in direct healthcare costs.

• Knee and hip osteoarthritis contribute billions more due to surgeries, imaging, and medication use.

• Many of these costs are avoidable with timely, evidence-based physical therapy.

How Physical Therapy Reduces Costs

1. Preventing Unnecessary Surgeries

Orthopedic surgeries like knee replacements, spinal fusions, and rotator cuff repairs are often expensive and risky.

• Research shows that patients who try physical therapy first are 50% less likely to undergo surgery for conditions like low back pain and knee injuries.

• PT not only saves on surgical costs but also reduces the expense of post-op rehab, complications, and hospital readmissions.

2. Reducing Imaging and Diagnostic Costs

Expensive imaging studies — MRIs, CT scans, and X-rays — are often ordered prematurely.

• Studies show that patients who start PT early are 30–40% less likely to need advanced imaging.

• PT providers can identify functional movement problems and initiate treatment without the need for unnecessary diagnostics.

3. Lowering Long-Term Medication Use

Chronic pain management often leads to prolonged use of opioids, anti-inflammatories, or other pain medications.

• Early PT intervention has been shown to reduce opioid prescriptions by 89% for patients with musculoskeletal pain.

• Less medication use translates into lower pharmacy costs and fewer medication-related complications.

4. Promoting Faster Recovery and Return to Work

Physical therapy gets patients moving sooner, which promotes healing and speeds recovery.

• Patients receiving early PT return to work faster, reducing lost productivity costs for employers and insurers.

• For injured workers, PT decreases the length of disability claims and workers’ comp expenses.

5. Preventing Future Health Problems

Physical therapists don’t just treat symptoms — they address the root cause of movement dysfunction.

• By improving strength, flexibility, posture, and movement patterns, PT reduces the risk of future injuries and recurrences.

• This proactive approach saves money by breaking the cycle of chronic pain and repeat treatment.

Why Insurance Companies Should Invest More in PT

Despite overwhelming evidence, insurance reimbursement for PT often lags behind other interventions. Here’s why that needs to change:

• Higher ROI: Every dollar invested in physical therapy leads to significant cost savings downstream by avoiding unnecessary surgeries and hospitalizations.

• Better Outcomes: Early PT improves patient recovery timelines and satisfaction, reducing overall utilization of healthcare resources.

• Lower Risk: PT is a conservative, non-invasive treatment with minimal side effects compared to surgery or chronic medication use.

• System Sustainability: As healthcare costs spiral, payers must adopt solutions like PT that are both cost-effective and evidence-based.

A Call to Action

For the healthcare system to truly benefit from physical therapy’s cost-saving potential, insurance companies and policymakers must take action:

• Expand coverage for PT visits to encourage early intervention.

• Reimburse appropriately so clinics can hire top talent, invest in advanced equipment, and deliver high-quality care.

• Promote awareness of PT as a first-line treatment for musculoskeletal conditions.

The Bigger Picture

When patients access physical therapy first, everyone wins:

• Patients recover faster and avoid unnecessary procedures.

• Insurers save money on surgeries, imaging, and long-term medications.

• Employers reduce disability claims and get their employees back to work sooner.

• Communities become healthier, more active, and less burdened by chronic pain.

Physical therapy isn’t an expense — it’s an investment in better outcomes, lower costs, and a healthier population.

Final Thoughts

The future of healthcare depends on evidence-based, cost-effective solutions that put patients first. Physical therapy fits that model perfectly.

It’s time for insurance companies and the healthcare system to recognize the value of PT, support clinics with fair reimbursement, and empower patients to get the care they need before unnecessary and costly interventions.

Investing in PT today saves time, money, and lives tomorrow.