5 Things Clinic Owners Must Know About Direct Billing in Private Physiotherapy and Allied Health Care Clinics

Direct billing in physiotherapy looks simple on the surface. Patients love it, it saves them the hassle of submitting receipts, and it can feel like a perk that sets your clinic apart.

But anyone who has actually run a clinic knows it’s not that straightforward. Direct billing comes with risks, responsibilities, and a heavy administrative load. I know this firsthand—I eventually stopped offering it in my own practice because the stress and liability outweighed the benefits.

If you’re a physiotherapy clinic owner considering direct billing, here are 5 things you need to know before hitting “submit.”

1. Scope of Practice vs Scope of Coverage

This is the biggest one. Just because you can legally provide a service as a physiotherapist or RMT doesn’t mean an insurance company has to cover it.

Take physiotherapy support workers (PTSWs) or Pilates for rehab. Both are in our scope of practice, but many insurers, like Pacific Blue Cross, don’t cover them. If you bill for something that isn’t covered, you’re the one responsible.

Every insurer is different, and their terms and conditions are constantly changing. Patients can still pay out of pocket and submit receipts themselves, but the liability shouldn’t sit entirely on you as the clinic owner.

2. Consent Is Everything

If you’re going to direct bill, you need signed consent on file from the patient. And it’s not enough to use a generic form. Insurers like TELUS, Sun Life, and Pacific Blue Cross all require their own versions.

You also need consent if you plan to charge a patient’s credit card when claims are denied. Without that documented, credit card companies may side with the patient in a dispute.

Protect yourself by getting the right forms signed up front.

3. Understanding Risk and Responsibility

Here’s the part most clinic owners don’t realize: you carry the liability. If your team makes a mistake and you submit the bill, you are the one insurers will come after in an audit.

With AI now scanning claims for inconsistencies, even small errors like unsigned chart notes can trigger massive clawbacks. Unless you’ve built indemnity clauses into your contracts, you may have no way to recover those losses from the clinician who made the error.

If you want to direct bill, make sure your contracts, policies, and systems protect the clinic—not just the practitioner.

4. The Hidden Admin Burden

Yes, direct billing saves patients time and can reduce credit card fees. But let’s be honest: the administrative side is brutal.

Most claims go through smoothly, but the 10 percent that don’t will eat up your staff’s time—denials, pending claims, dual coverage, calls from insurers. That 2–3 percent you save on fees? It often disappears once you factor in the cost of admin hours spent chasing down money.

Direct billing only works if you have strong systems, bookkeeping software, and enough admin support to handle it.

5. Audit Terms Matter

When you sign up with an insurer, you’re agreeing to their rules. Full stop. And those rules usually favor the insurer.

For example, Pacific Blue Cross has audited physiotherapy clinics up to three years back, while patients who submit on their own may only be audited one year back. That’s a huge difference in risk.

Every insurer has their own audit terms, clawback timelines, and requirements. If you’re direct billing, you need to know exactly what you’ve signed up for and have systems in place to meet those expectations.

Final Thoughts

Direct billing isn’t inherently bad. Patients love it, and it can help with retention. But the risks, admin load, and audit exposure are real—and too many clinic owners don’t fully understand what they’re agreeing to.

If you decide to direct bill, do it with your eyes open. Get proper consent forms. Protect yourself with contracts. Have airtight admin systems. And most importantly, know the audit terms inside and out.

If you’re not sure whether direct billing makes sense for your clinic, let’s talk. This is exactly the kind of decision I help clinic owners work through in my consulting practice.

Listen to my full episode on The Health of Business podcast for the full breakdown

Or reach out to chat about your clinic’s direct billing setup: