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The U.S. occupational & physical therapy services market size was valued at USD 47.50 billion in 2021 and is projected to grow from USD 50.26 billion in 2022 to USD 72.70 billion by 2029, exhibiting a CAGR of 5.4% during the forecast period. Based on our analysis, the U.S. market exhibited a decline of -13.0% in 2020 as compared to 2019. The global COVID-19 pandemic has been unprecedented and staggering, with occupational & physical therapy services experiencing lower-than-anticipated demand in the country compared to pre-pandemic levels.
The U.S. has recently witnessed a steep demand for occupational & physical therapy solutions. These services are crucial in alleviating the quality of life of individuals suffering from cognitive disabilities, movement disorders, chronic pain, and injuries. Moreover, these therapies aid in preventing short-term disabilities from turning into chronic conditions. The growing prevalence of chronic diseases in the U.S. and the increasing number of sports injuries are primarily responsible for augmenting the growth of the market.
Additionally, favorable reimbursement policies, the growing number of occupational and physical therapists in the country, and increasing awareness about the benefits of occupational and physical therapies support the adoption of these services.
Market Growth Hampered Due to Reduction in Patient Visits amid COVID-19
The COVID-19 pandemic adversely affected the U.S. occupational & physical therapy services market in 2020 due to many factors. Reductions in patient visits to outpatient rehabilitation clinics due to the imposition of stringent lockdown regulations in the nation is one of the key factors that affected the market during the pandemic. Furthermore, a sharp decline in hospital visits due to a temporary halt on elective and non-emergency procedures disrupted the demand and supply of these services. In addition, most of the occupational & physical therapy clinics were closed due to the strict lockdown. Moreover, the impact of COVID-19 is projected to have affected the business of the key players operating in the market.
However, the market experienced a strong rebound in the financial year 2021 attributed to relaxations in COVID-19 lockdown and increased adoption of telehealth tools in public and private practices.
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Increase in Growth Opportunities on Account of Growing Emphasis on Patient Engagement Coupled with Adoption of Wearable Technologies
Occupational & physical therapy service providers are adopting advanced technologies and rehabilitation gyms for patient retention and engagement. Many rehabilitation centers are opening gyms for patients so that they remain healthy after being discharged from hospitals.
Furthermore, increasing adoption of wearable devices and telehealth services also improved patient engagement. The requirement of physician face-to-face visits at least three days a week may be fulfilled using telehealth. The majority of occupational and physical therapists in the U.S. are offering telehealth services after COVID-19 to treat patients. According to the report published by the American Physical Therapy Association, 98.0% of physical therapists were not offering telehealth consultations with patients before the COVID-19 emergency. However, after July 2020, more than 47.0% reported using telehealth, a proportion anticipated to increase over the pandemic.
Market Growth Propelled By Growing Prevalence of Chronic Disorders and Geriatric Population
One of the prominent drivers of the market is the increasing prevalence of chronic diseases in the country. The growing number of patients suffering from chronic diseases is anticipated to surge the demand for rehabilitation services, including OT and PT services, during the forecast period.
Moreover, the growing elderly population in the country is presenting a large patient pool requiring occupational & physical therapy services. Older people are susceptible to various chronic disorders. Also, falls are a common reason for seniors who require physical therapy. Thus, the rising aging population in the country is responsible for increasing OT and PT services adoption, thereby augmenting the U.S. occupational & physical therapy services market growth.
Industry Value to Rise Due to Shifting Preference toward Non-opioid Alternatives for Pain Management
Another important factor expected to drive the market growth is the shifting preference of patients toward physical and occupational therapies instead of medication due to certain side effects associated with medication therapies. These factors and other serious issues, such as misuse of prescriptions, overdose, and related deaths due to opioids, are causing the shift of patients from medications to occupational & physical therapy services. Furthermore, significant coverage provided by payors for non-opioid treatment for pain management has raised the demand for occupational & physical therapy services in the country.
Furthermore, the long-term benefits associated with physical therapies are anticipated to surge the demand for rehabilitation therapies, including occupational & physical therapy services. Additionally, the increasing patient pool suffering from chronic pain is anticipated to surge the demand for pain management solutions.
Moreover, the growing awareness about the benefits of physical and occupational therapy among patients influences the adoption of these services and drives the market growth during the forecast period.
Market Growth to be Hampered by Reimbursement Capping for Therapies
The majority of the patients in the U.S. are dependent on medical reimbursements for healthcare expenses. The country's public and private insurance providers are instigating price capping on various physical and occupational therapies, which is anticipated to hamper the adoption of these services during the forecast period.
Moreover, high claim denials associated with occupational and physical therapies are prominent factors restricting market growth. The primary reasons for claim denials are data entry errors, misuse of the modifier codes, failing to establish medical necessity, and eligibility issues. The increasing claim denial rates in the U.S. are accountable for restraining the adoption of physical and occupational therapies.
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Outpatient Clinics Segment to Hold Largest Share Owing to Increasing Workplace Accidents
Based on setting, the market is segmented into hospitals, outpatient clinics, and others.
The outpatient clinics segment is estimated to be the largest segment during the forecast period. The dominance of this segment is attributed to the increasing number of physical therapy outpatient clinics, surge in the number of industrial accidents in the U.S., and increasing demand for occupational & physical therapy services in the country.
The hospitals segment is expected to account for the second-largest market share and is anticipated to register a significant CAGR during the forecast period. The surge in the prevalence of chronic diseases and increasing collaborations between market players and hospitals offering physical and occupational therapies are major reasons driving the segment growth.
Orthopedic Therapy Segment Dominates the Market due to Increasing Prevalence of Orthopedic Diseases in the Country
Based on application, the market is segmented into orthopedic therapy, general therapy, geriatric therapy, pediatric therapy, neurological therapy, and others.
The orthopedic therapy segment dominated the U.S. market in 2021. The growing prevalence of orthopedic diseases and the increasing number of sports injuries are anticipated to drive segment growth. Moreover, increasing cases of bone fractures in the U.S. are responsible for driving the segment growth.
Moreover, the general therapy segment held a significant share in the market due to the growing prevalence of psychological disorders such as anxiety and depression. The segmental growth is further driven by an increasing number of occupational therapists to meet the rising demand for occupational therapy services.
Private Health Insurance/Out-of-Pocket Segment Share to Rise Due to Increasing Collaborations between Healthcare Institutions and Private Health Insurance Companies
By payor, the market is segmented into public health insurance and private health insurance/out-of-pocket.
The private health insurance/out-of-pocket segment held the largest share in the market. It is attributed to the increasing number of insurance holders in the country and the increasing collaborations between private health insurance companies and healthcare institutions in the U.S. Further, the market is projected to grow owing to rising initiatives by private insurance companies to cover occupational & physical therapy services.
Moreover, the public health insurance segment held a significant share in the market attributed to collective initiatives by Medicare, Medicaid, and other public health insurers to provide affordable healthcare to people in the U.S. and increasing public insurance holders in the country.
Select Medical Dominates the Market Owing to Growing Emphasis on Strategic Collaborations
The market is highly fragmented, with many players operating in the market. The top players leading the market include Select Medical, Upstream Rehabilitation Inc., Athletico Physical Therapy, and ATI Physical Therapy. These players hold a significant share in the market due to increasing strategic collaborations, introduction of innovative technologies, and rising emphasis on inorganic growth strategies for bolstering their market presence.
Moreover, other players such as Encompass Health Corporation, U.S. Physical Therapy, and PT SOLUTIONS continuously engage in strategic expansion initiatives to establish their footprints in emerging regions.
An Infographic Representation of U.S. Occupational & Physical Therapy Services Market
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The U.S. occupational & physical therapy services market research report provides a detailed analysis of the market. It focuses on key aspects such as competitive landscape, setting, application, and payor. Besides this, it offers insights into the industry and market trends and highlights key industry developments. In addition to the factors mentioned above, the report encompasses several factors that have contributed to the growth of the market in recent years.
Value (USD Billion)
By Setting, Application, and Payor
Fortune Business Insights says that the U.S. market size was USD 47.50 billion in 2021 and is projected to reach USD 72.70 billion by 2029.
The market is expected to exhibit steady growth at a CAGR of 5.4% during the forecast period (2022-2029).
By setting, the outpatient clinics segment dominates the market.
The increasing prevalence of chronic diseases, the growing burden of the old age population in the U.S., and favorable reimbursement policies are the key drivers of the market.
Select Medical, Upstream Rehabilitation Inc., Athletico Physical Therapy, Encompass Health Corporation, and ATI Physical Therapy are the top players in the market.
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