Insurance vs Private Pay Private Practice | My Experience with Insurance
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- Опубліковано 11 лип 2024
- Insurance vs Private Pay Private Practice | My Experience with Insurance
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A major question people ask when first starting out in private practice is whether they ought to be on insurance panels. In this video I’ll share my own experience being on insurance panels in private practice.
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This video is geared for therapists of all kinds, including psychologists, MFTs, LPCCs, social workers, and others in the clinical counseling field.
Welcome to Private Practice Skills! I’m Dr. Marie Fang, psychologist in private practice. I post videos offering tools I learned the hard way about starting and growing private practice so that you don’t have to.
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This video is not intended as professional or legal advice. Be sure to seek the services of a professional if you are in need of them.
After I saw that my first postdoc in private practice wasn’t getting me my hours for licensure quickly enough, I joined a clinic that primarily accepted clients paying through insurance. Here are some of the pros and cons I experienced in that setting, plus all the things I did wrong:
Pros:
Full Practice.
No Marketing. Piggybacking off of that pro, I didn’t have to do any marketing at all. Potential clients called in because they got our clinic’s name through their insurance.
More accessible for clients.
Cons:
Lack of Control. I didn’t have any control over what clients I met with. Unless I was completely unqualified to work with a particular client, I had to take everyone who called.
Pay. Pay was a HUGE con. Insurance decides how much they believe the going rate is for your services based on your qualifications and zip code, but they often judge this as much lower than market rate. From that, they only pay you a PERCENTAGE of that rate. They think they deserve a cut for getting you that client without you having to do any marketing.
Okay, fair enough. But it gets worse. Even after going through a thorough pre-approval process to make sure a potential client qualified to apply their insurance for my services, still about 50% of the claims would get denied. Think about that - you put in all this work and you might only get to take home the copay from the client - which was usually around $25 per session. That’s not even enough to break even. As an intern, that came out to just a couple dollars on the hour reflected in my paycheck.
Wasted Time. I spent around 3-5 hours per week on hold with insurance companies contesting denied claims. Not only did this waste my time, this was time that I could have been meeting with clients, so I also see this affecting pay as well.
Disrupted Therapy. Even though about half my claims were denied, I often didn’t receive a denied claim from insurance until several months after submitting my first claim for a particular client. So I would be 3 months in to weekly therapy with a client only to find out that they now owe me $1500 they didn’t expect to pay. Can you imagine if that happened when you went to go pick up your car from a tune-up? They initially quoted it would cost you a couple hundred bucks, and now you suddenly owe well over a thousand? It’s totally unfair. Often clients would stop therapy at this point, and I received many angry phone calls from clients when they would get the news.
Stigmatization. Insurance only pays when we give an ICD-10 diagnosis, and even then it often needs to be moderate or severe for them to cover it. Not everyone meets criteria for a more severe diagnosis, and for those who do they may not wish to have that on their insurance record.
What I think I did wrong (or in this case, my supervisor did wrong):
Get specialized training. Insurance billing is a PROCESS. If you’re thinking of billing insurance yourself, explore coursework specifically designed to teach you how to do it. It’s not a “learn as you go” type of endeavor. Any little error on a claim is cause for insurance to deny the claim.
Employ someone to bill insurance. Don’t like the idea of spending 20% of your workweek on hold with insurance? You may want to consider hiring someone to do that for you.
If you’re considering accepting insurance in private practice, it’s a good idea to think through these items.
I do billing for an acupuncturist. We've dumped a couple of his payers due to low pay, high denials and constant MNR submissions. We've added courtesy billing to his practice. Most people won't submit these on their own, so I've found it helpful to offer this service for them. They pay full price upfront, and refund goes directly to the patients, sometimes the patient pays less than their co-pay. This captures more patients for your practice and eliminates the hassle of dealing with the insurance companies.
This needs to be addressed by policy makers. Health insurance companies in the US wield too much lobbying power and impact the access and quality of care.
Insurance is a whole different ball game. If you are going to accept insurance verify the pt bh benefit 1st. Yes its very time consuming but it will be best. When I call to verify i find out if that insurance actually covers their bh benefit and sometimes it does not. For example a pt may have BCBS but their bh is covered by Magellan. Sometimes pt do not know this. And copays play a big part too. I have had individuals decline services bc they had a $40 copay.
I trained in major medical hospitals inpatient and outpatient hospital clinics; so I had absolutely no experience with insurance companies and their Drama Rama. When I opened a private practice, I kept my medical staff privileges and also applied for medical staff privileges at other hospitals. My referrals for my private practice all came from my medical colleagues. I have never been paneled with insurance companies for my private practice. Private Pay Only. all master level therapists and doctoral and postdoctoral psychologists in my territory only accept Private Pay. ~~thank you for the video Dr. Marie
The best advice I've gotten is that once you are licensed, to try one panel out for 1 year and see how you like it and if its a positive for your practice. My practice is 50/50 now and its a pretty perfect balance for business side, cash flow, and gives me a very diverse case load! My past supervisor has told me he never struggled with any claims or needing to provide documentation so maybe things are becoming more accessible since COVID years? Thanks for your videos!!!!!!!
Thank yo so much for making these videos! I'm about to start the masters program in counseling here at the local university and and am learning as much as I can.
Private pay even if it's gonna take me awhile to build my caseload! 😅🙏
Eunice Shin I definitely understand that choice! It may be possible that you still earn more income that way even when your caseload is smaller.
You are hilarious! And thank you, this video is really helpful!
This was incredible and so helpful - thank you! I've always wanted to organize my private practice without the hassle of insurance (I specialize in trauma and fear the therapeutic process would be blunted by insurance denials...just another potential trigger of losing power & control) so I am really hoping I can go private pay just one day a week (while maintaining FT hours at another job) just to build my caseload. This video gave me a glimmer of hope that it is a viable option (to not take insurance) and helped to outline what you need to do (marketing etc). Really loving your videos and channel; please keep up the amazing work because we value your support and expertise!
That is a great strategy! Keep your FT job and slowly dip your toes into private practice. I hope you enjoy the process!
Very helpful walk-through
1 - your hair color is gorgeous! 2 - very helpful. I am looking to get a masters and just learning all this about the biz. Thanks!
Thanks! I can never seem to keep my hair color the same for very long since it's so porous and likes to change color quickly in the sun. So I'm always trying new things to correct it and it can be hit or miss! Best wishes to you as you pursue a masters!
holy crap, thanks..this was SUPER helpful.
Oh yay, I'm glad you found it helpful!
Thank you for sharing your experience!
Thanks so much! I know everyone has unique experiences so I hope people find the best fit for them!
Thanks! This was very helpful
So glad to hear it! :)
I like group practice for getting on insurance panels. However, when you dealing with insurance it affects your pay. I get paid once a month and with the corona virus COVID-19. It’s a struggle because with clients drop due to high co pays until they meet their deductible. There’s a lack of control of when I get my 60% and the facility gets 40%. Wasted time yes....no bueno. 😟 Everything you said is true I plan to move towards private practice and avoid insurance if possible.
I hope you find a path that's a good fit for you soon!
I love your channel
I realize this is an older video. At the time of this writing it is May 2023. I think some things have changed in the insurance world. I started a private practice in late 2022. For the most part, all of my clients prefer to use insurance over self pay. I have only had one denial so far that I am still trying to appeal. And, so far, I only have one case of an insurance company losing my claims (they say they have no record of claims being sent to them when I have evidence that they were sent in). So, there have been a couple of problems that have needed my attention, but for the most part, I am getting paid on a regular basis. I do not live in an affluent area of the USA and most people do not want to pay cash if their insurance will cover their sessions. The city I live in is the capital of my state and many working individuals in my area are employed by the state and have insurance that is reliable. Another source of income for me is EAP counseling. Although EAP does not pay very well, the clients who use it usually decide to remain on my caseload after their EAP benefits run out and then I can bill their insurance companies. There is one particular insurance company I work with that does not pay me well at all, and I might not renew my contract with them next year. I just want to provide some encouragement for people who are thinking about taking insurance. I love Private Practice Skills. It has been a huge help to me. Thank you.
Thank you for the video! My husband is starting a private practice and I will be handling the billing. Do you have videos or recommendations for the specialized training you mentioned in this video?
Thank you for sharing your experience. I’m thinking of starting private practice in the next year or so. I was not aware of the cons regarding insurance. Definitely something to think about.
Melissa Fontenot it is definitely worth considering all the pros and cons before making the right choice for you!
I’ve always heard bad things about accepting instance companies.
Who are you held to accountable to when you do only private pay? Thanks!
No wonder all of the professors in my PsyD program urge us to not rely on insurance companies.
Insurance companies are like a stranger in a suit standing in the corner with a calculator during the session. Get. Out.
How frequently does insurance pay therapist? I have a great opportunity to potentially work in a group private practice under someone who accepts insurance, so I will have to accept insurance. I have student loans and will need to get regular payments though.
Do you need a phd or doc for this or can I just use the masters degree in about to start in September?? Thank you love the channel
I suggest you double-check with your local insurance panels and see what their policies are. I bet you can also learn more by connecting with the therapists in your area and asking around. Good luck!