Physical Therapy and Financial Planning, Part 2: The Treatment Plan

In the first part of this 2-part series published last month, we presented how the initial patient evaluation in physical therapy is very much like the discovery process in financial planning. Both involve an in-depth examination of the patient/client necessary before a determination can be made as to how best address their needs. In this the second part, we will present how the treatment plan addresses the physical needs of the patient in the same way a financial plan maps out the how the client can achieve their goals.

The Treatment Plan

After completing the initial examination, the physical therapist will discuss their findings which include the PT diagnosis and prognosis. Sometimes this diagnosis may differ from physician findings. If that is the case, the PT will explain their reasoning for how they came to this determination. The prognosis is important for the patient because it gives them a realistic timeline for the treatment of their ailment.

Treatment typically begins with education regarding the pathology, typical treatment, expected recovery, and long-term expectations of the patient and PT. This education is ongoing throughout treatment and will assist the patient in better understanding not only their injury/pathology and what may have caused it, but how to prevent it from reoccurring in the future.

In the case of post-operative patients, an important aspect to address is post-op instructions. These can include pain management techniques, which motions/activities to avoid, and benefits of early mobility. It is imperative that patients understand these instructions as they can negatively impact their healing and recovery if not followed.

Similar to the financial plan discussed later, the physical therapy treatment plan is tailored to each individual patient using subjective (qualitative) and objective (quantitative) data obtained during the initial evaluation. This data is the basis for the plan that the PT will employ during the course of treatment. However, this plan is not set in stone. The plan can and usually changes as the patient’s response to treatment is evaluated on a daily basis. This allows to physical therapist to ensure that the methods utilized are effective for that particular patient. 

The Financial Plan

Once the discovery process is complete, which involves the gathering all of the client’s quantitative (amount of assets, income, etc.) and qualitative (needs, wants and goals) data, the advisor can begin to develop the financial plan. In the initial stage, the financial plan creates a reality test to determine if the client’s goals are attainable based on the client’s current and planned future assets relative to their stated goals and objectives.

Assuming the goals and objectives are realistically attainable within the client’s time frame, the advisor proceeds on a step-by-step process of how to best address specific concerns which may include maximizing retirement savings, utilization of currently available and future income, portfolio management, possible income tax and estate planning strategies. These strategies are typically divided into short, intermediate, and long-term tasks to be accomplished.

A financial plan will most likely seek to implement the most urgent tasks within the first 30 – 60 days.  These may include consolidating personal (non-qualified) and retirement accounts as it is common for investors to have several accounts with different advisors or from previous employers.  Another task in the short-term is that the advisor may coordinate the investor’s selected portfolio allocation to each of the newly consolidated portfolio type.

Common intermediate tasks, to be accomplished in the first 90 days, is adjusting retirement plan deferrals to take maximum advantage of available plan provisions and to maximize asset accumulations.  Tax optimization strategies can also be coordinated with the client’s CPA and implemented during this phase of the planning process.

Developing estate planning strategies and ultimately the appropriate will and trust documents tend to take a bit longer, typically in the 120-day range.  The estate plan should incorporate the client’s goals and wishes for the utilization of their assets during their lifetime and the disposition of those assets upon their death.

Once the financial plan is fully implemented, it must be monitored and updated on a regular basis, typically not less often than every 12 months.  This will keep the plan current and relevant to the client’s goals.