Sonoma’s largest independent physical therapy center to close

One of Sonoma’s largest physical therapy practices and the only local option for aquatic therapy is closing at the end of October.

Caliente Springs Physical Therapy owner and co-founder Mike Kelly is disbanding his corporation and terminating his lease at 17350 Vailetti Drive.

“It is devastating… but what it comes down to, after almost 20 years in business, is lower and lower insurance reimbursements, service interruptions during fire season and, now COVID,” Kelly said. “The bottom line has just fallen away.”

Kelly’s operation includes a small gym, three treatment rooms and use of the adjacent Aquatic Center pool. He specializes in aquatic therapy, and is one of the few North Bay physical therapy centers to offer the popular option.

Health insurance payments going down

While physical therapy is a booming growth business due to an aging population, sedentary lifestyles and early specialization in sports, smaller independent providers are struggling with lower reimbursement rates and stricter Medicare billing guidelines.

In January 2021, Medicare will reduce its reimbursements for physical therapists by 9 percent and for treatments provided by PT assistants by 15 percent, according to Kelly. He estimates that 70 percent of his business is Medicare clients.

“The [private practice] therapists who are getting by right now are those that are private pay – not taking insurance,” he said.

High cost of doing business

While insurance reimbursements have been going down, the cost of business has steadily risen. Kelly has been happy with his location and that his landlord has “been really good” but Kelly has a triple net lease, making him partially responsible for taxes, maintenance and repairs on the property.

“Since 2017, it has been a rough go and every year it seems like something comes up to make it more costly to operate,” he said.

COVID guidelines

Caliente Springs shut down completely in mid-March and Kelly laid off his staff. After six weeks, he got the clinic open again and gradually hired three therapists back, thanks to a personal loan and a PPE loan of $54,000. But Kelly will have exhausted most of the loans by the end of October.

“It just doesn’t make sense to go into further debt,” he said.

Prior to the pandemic, Kelly had three physical therapists, seeing patients every 30 minutes. With COVID regulations in place, he now has no more than two therapists seeing clients every 45 minutes to allow for cleaning and disinfecting between appointments.

“We hoped this would blow over in a couple of months but there is no end, no back to normal in sight,” said Kelly.

What about telehealth?

Typically, physical therapists need to get close to people in order to treat them. “Telehealth has its limitations when it comes to what we do,” says Kelly.

“It is very helpful for some clients but only appropriate for a small portion of cases,” he said. “Most of our clients want that one-on-one encounter.”

Service interruptions

Kelly said that ever since the fires in 2017, and power outages in subsequent years, operating the physical therapy practice has been a struggle.

“We lost income that we haven’t been able to make up,” he said.

So what lies ahead for Kelly?

Physical therapy and aquatic therapy have been Kelly’s life work. He trained at UCSF and did an additional year of aquatic therapy at Mills Hospital before starting Sonoma Valley Hospital’s aquatic physical therapy practice in 1993.

He reached out to a physical therapy practice in Petaluma to see if they might be interested in taking over his business, lease or equipment. “But they are battling the same issues we are.”

The Index-Tribune reached out to Sonoma Valley Hospital, which operates the other large physical therapy practice in Sonoma, behind Sonoma Fit gym on Sonoma Highway. A spokesperson for the hospital said that the hospital has “no plans to take over the Caliente Springs Physical Therapy practice” but is examining “the best way to serve their clients.”

The demand is there. Caliente Springs is typically fully booked in any given week.

Sandi Genovese, 75, began seeing Kelly earlier this year because of a complications from a torn rotator cuff.

“Everyone I called recommended Mike,” she said. “I had tried one other place in the past and I couldn’t believe the difference. The team there made such a difference in my recovery. This a terrible loss for the community.”

Jill Gumina found herself with debilitating lower back issues, unable to stand for more than a few minutes at a time, after knee surgery in March. Her husband recommended she see Kelly at Caliente Springs to see if she could improve her quality of life.

“Mike is a life-saver,” she said. “Every time I tell people about how much his team has helped me with my back, they tell me their own stories about the great success they have had there, how his team has helped them to get their lives back. I will cry if he closes. I will be brokenhearted.”

Clients told the Index-Tribune that they want to create a Go Fund Me fundraising page for Kelly, and were confident that many current and former clients would contribute.

“While I so appreciate that,” said Kelly. “It would just be a band aid. I can’t see a way to fix the underlying issues here and to stay open.”

Looking back over the past 20 years, Kelly said that building his practice and offering aquatic therapy in Sonoma has been a dream come true for him.

“I’m not sure what I will do now but I hope to still treat patients in Sonoma somehow.”

Contact Lorna at lorna.sheridan@sonomanews.com.