One of the most anxiety-inducing questions for any OTP launching a private practice or side hustle is deceptively simple: how much should I charge? Most OTPs have spent their entire career having someone else set their rates. Now, for the first time, that decision falls on you — and getting it wrong feels risky in both directions. Charge too much and nobody books. Charge too little and you burn out working for less than you made as an employee.
The truth is that pricing is not a guessing game. It's a calculation informed by your costs, your market, and the value you deliver.
Why Most OTPs Underprice Their Services
Underpricing is far more common than overpricing in our profession. There are a few reasons for this. First, most OTPs are used to thinking about their hourly wage as an employee, not the full cost of delivering a service. When you were earning $38 an hour as a salaried clinician, charging $150 an hour feels outrageous — until you realize that your employer was billing $250 or more for that same hour and using the difference to cover overhead, benefits, and profit.
Second, OTPs tend to be helpers by nature. We went into this profession because we care about people, and attaching a dollar amount to that care can feel uncomfortable. But here's the reframe: if your rates don't sustain your business, you won't be around to help anyone.
Step 1: Know Your Numbers Before You Name a Price
Before you can set a rate, you need to understand what it actually costs you to deliver one hour of service. This goes well beyond your time in the session.
Calculate Your Fully Loaded Cost Per Hour
Your true hourly cost includes direct session time plus all the non-billable time that supports it — documentation, care coordination, travel, preparation, and follow-up. For most OTPs in private practice, every billable hour requires roughly 30 to 45 minutes of non-billable work.
Then layer in your fixed business costs: liability insurance, licensure renewal, continuing education, software subscriptions, marketing expenses, health insurance (if you're self-paying), retirement contributions, and taxes. As an independent practitioner, you're covering self-employment tax at approximately 15.3% plus your income tax bracket.
Step 2: Research Your Market
Your rate doesn't exist in a vacuum. You need to understand what other OTPs in your area and niche are charging, and what clients are accustomed to paying.
Where to Find Rate Data
Start with the AOTA Workforce & Salary Survey for national benchmarks. Then get local and niche-specific by checking competitor websites (many list rates), calling local practices as a prospective client, asking colleagues in OT business communities, and reviewing what insurance companies reimburse for equivalent CPT codes in your region.
Factors That Justify Higher Rates
Not all OT services are created equal in the market's eyes. Several factors allow you to command premium pricing: advanced certifications or specializations (CLIPP, CHT, CDRS, CAPS), niche expertise that's difficult to find locally, home-based or mobile services where you travel to the client, concierge or after-hours availability, and demonstrated outcomes or testimonials.
Step 3: Choose a Pricing Model
Hourly rates are the most straightforward, but they're not the only option.
Per-Session Pricing
This is the most common model in clinical OT. You set a rate per session, typically ranging from $100 to $250 depending on your market, specialty, and whether you're billing insurance or private pay. Clients understand what they're paying per visit, which makes budgeting predictable for everyone.
Package Pricing
Bundling sessions into packages (such as 6 sessions for a set price) offers several advantages. It creates commitment from the client, improves your cash flow with upfront payment, and reduces no-shows because the client has skin in the game. A modest discount for package purchases (5-10%) is standard and often worth it for the reliability.
Retainer or Subscription Pricing
For consulting work — ergonomic assessments for businesses, ongoing home modification advising, or facility consulting — a monthly retainer provides predictable income. This works particularly well when your services are advisory rather than hands-on clinical.
Value-Based Pricing
Instead of pricing based on your time, price based on the outcome you deliver. A comprehensive home safety assessment that prevents a $50,000 hip fracture hospitalization is worth far more than two hours of your time. When you can connect your service to a measurable outcome, you can price accordingly.
Step 4: Set Your Actual Rates
Here's a practical framework for landing on a number:
1. Start with your break-even calculation from Step 1
This is your floor. You cannot sustain a rate below this number.
2. Cross-reference with your market research from Step 2
If your break-even rate is significantly above market rates, you either need to reduce expenses, increase efficiency, or identify a premium niche that justifies higher pricing.
3. Position yourself intentionally
Don't default to the cheapest option. Most OTPs launching a practice should aim for the middle to upper range of their local market. Bargain pricing attracts bargain clients and signals low quality.
4. Build in room for adjustments
It's significantly easier to offer a discount or introductory rate than to raise your prices later. Start slightly higher than feels comfortable — you can always adjust downward, but raising rates on existing clients is a harder conversation.
Common Pricing Mistakes to Avoid
Matching your employed hourly rate. Your salary as an employee covered only your labor. As a business owner, your rate must cover labor plus overhead plus profit plus taxes. They are fundamentally different calculations.
Competing on price. If the only thing distinguishing you from another OTP is that you're cheaper, you're in a race to the bottom. Compete on expertise, specialization, convenience, or experience instead.
Offering too many free sessions. A single free discovery call is a smart business strategy. Offering free initial evaluations, free trial sessions, and free follow-ups tells the market that your time isn't worth paying for.
Not raising rates annually. Your costs go up every year — insurance, software, supplies, continuing education. Your rates should keep pace. A 3-5% annual increase is standard and expected in professional services.
How to Communicate Your Rates With Confidence
Stating your rate should be matter-of-fact, not apologetic. Practice saying your rate out loud until it feels natural. When a prospective client asks about pricing, lead with value, then state the number, then explain what's included.
For example: "My comprehensive home safety assessment includes a 90-minute on-site evaluation, a detailed written report with prioritized recommendations, and a 30-minute follow-up call to answer questions. The investment is $350."
Notice the structure: what they get, then the price. Not the other way around.
Building your OT practice doesn't have to mean figuring out pricing alone. OT Connected gives you the tools, community, and resources to run your business with confidence.