The Problems Created by Credentialing with Health Insurance for Therapists, Their Clients, and the Field of Mental Health by Brianna D. Mann, PhD

Tiffany Note: The following article is a guest post from Brianna Mann, PhD first published here on

There are many reasons therapists credential with insurance:

1) It’s what everyone does;

2) Doing so ensures a steady referral stream;

3) It provides access to care to a wider demographic; an opportunity to “give back”;

4) They have skills deficits and fears that prevent them from converting to private pay such as:

A) “I don’t know how to market and run a business”;

B) “Making money is bad”; “Providing charity is good”;

C) “No one who buys insurance will pay extra to see me”; and

D) “I’ll never find enough private pay clients to pay my bills”; “Some money is better than no money”.  

I’m sure there are plenty more.  I believe that we, as therapists, are doing ourselves, our clients, and our field a disservice by continuing to credential with insurance.

Click here to subscribe Therapists Work Additional Hours for Free It’s important to note that the number of client hours billed per week does not reflect the actual number of hours worked per week.  If therapists are credentialed with insurance, they can estimate that they will spend an additional 30 minutes per client, per week on various activities associated with insurance (e.g., credentialing, contracting, paperwork to authorize additional sessions, going through EOBs to make sure sessions were reimbursed, determining client portion of payment and collecting payment from clients, calling the insurance companies to discuss discrepancies, being upset about how much additional work they need to do to get paid, etc.).   Therapists are probably spending at least another 30-60 minutes per client, per week, on unpaid activities associated with their practice (e.g., session preparation, notes, scheduling, marketing, networking, referrals, consultation, training, internal process work, etc.).  Using these numbers, therapists who accept insurance spend 60-90 minutes, per client, per week, outside of session on client-related activities.  Taken together, these therapists are spending between 2 and 2.5 hours total per client, per week on practice-related activities, or 20-50 hours per week total, depending upon if the therapist sees 10 or 20 clients per week.  This time doesn’t include the self-care time essential for recharging to show up fully for work with clients.  I will discuss that later.
















To reiterate, providers who accept insurance spend 5-10 hours each week (depending on client load), above and beyond their regular duties, just dealing with the insurance process.   That is time that is given away: your precious time, for free!  Let’s look at what the reimbursement rates look like after paying basic overhead and when we factor in the unbillable time required to accept insurance.  Insurance company A reimburses at $130 per billable hour and Insurance Company F reimburses at $94 per billable hour; each company requires .5 unbillable hours per billable hour, for a total of 1.5 hours of required work, billable and unbillable; overhead is $40 per billable hour.  That means that the hourly rate for Insurance Company A is $130-40=90 divided by 1.5 total hours, which is $60 per hour.  The hourly rate for Insurance Company F is $94-$40, divided by 1.5 total hours, which is $36 per hour. The actual reimbursement rates are much lower than they appear in the contract you sign each year, and although Insurance Company A’s rate still doesn’t look that bad; Insurance Company F’s rate of $36 per hour is pretty low.  And, wouldn’t it be nice if your contract reflected your actual hourly rate of reimbursement? I think that’s called full disclosure.














































Contracted Hourly Rates Are Inaccurate and Accurate Rates Are Low If we take this a step further and enter in the total time spent on insurance-, practice- and client-related activities per week, which is 2-2.5 hours per client, the numbers are much lower.  The hourly rate under contract with Insurance Company A is $130-$40=$90 divided by 2-2.5 total hours, which is $45-$36 per hour. The hourly rate under contract with Insurance Company F is $94-$40=5$4 divided by 2-2.5 total hours, which is $27-$21.60 per hour.  Furthermore, I’ve chosen to present these numbers with only the basic overhead and haven’t included the other factors such as number of billable hours that are practical in a week, vacation time, or the often overlooked aspects of overhead such as benefits, self-employment tax, and student loan debt.  So, annual salary is not $21.60 to $45 per hour multiplied by 40 hours per week ($864-$1800) multiplied by 52 weeks in a year ($44,928-$93,600). The calculations required to determine a more accurate salary take up several more pages and are part of a larger article.  For your interest, I will include summary of those calculations here: -$14,321 to $29,737 per year (yes, that’s a negative number).    

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There’s No Guarantee of Payment or Timely Payment

Not only does accepting insurance require an additional 30 minutes per client per week, there is no guarantee that a provider will ever be paid by the insurance company for the work they’ve already done, and most certainly, the provider will not be paid in a timely manner.  For those of us familiar with the process, claims are typically processed and paid out within 1-4 months and sometimes are never paid, despite significant time and effort to receive reimbursement. I don’t know a single provider who has been paid for 100% of the legitimate claims they’ve filed.  There are lots of reasons given by the insurance company for these delays in payment and nonpayment of claims: the claim wasn’t received, the claim wasn’t received on time (even if it actually was submitted on time), there was some sort of error in processing the claim, there was a problem with their system, the diagnosis isn’t sufficient for that service, inaccurate coding by doctor, incomplete or inaccurate insurance information, lack of prior authorization or referral, the client’s specific insurance policy does not cover a 53-minutes session, it only covers a 38-minute session (after you have already provided a 53-minute session), the insurance company needs proof that the service is medically necessary (McKennon Law Group PC, 2017), or my favorite, the claim was approved but the insurance company “forgot” to issue a payment.  It would almost seem as if the system was set up to find ways to not pay claims.  Indeed, insurance companies utilize software nicknamed “denial engines” to search through claims for technical errors in order to increase the claim rejection rate legitimately (McKennon Law Group PC, 2017).

  • How many people would stay at a job where their boss didn’t pay for a full 1/3 of their working time (i.e., 60 minutes in session, 30 minutes out of session to bill)?  
  • How many people would stay at a job where requests to receive their paychecks are frequently denied?  
  • How many people would stay at a job where it could take 1-4 months to pay them?  
  • How many people would agree to learn and follow a complex billing rubric, with hundreds of variations, that can constantly change?

Should someone with a doctoral or master’s degree put up with all of this for compensation between -$14,321 to $29,737 per year?

Contracts are Limited and Clients May Switch Carriers at a Moment’s Notice

Another caveat is that, in some metro areas, such as the Twin Cities and Duluth, Minnesota, some of the most popular insurance companies (i.e., those with high enrollment numbers) with the best rates are not offering any new contracts.  Any therapists who decide to make the leap into private practice will not be able to get credentialed at the higher, $130 rate or will have to join a group practice in order to credential with those companies, which usually involves a much higher rate of overhead.  There may be other insurance companies offering the higher, $130 rate, but they typically don’t have the same enrollment numbers, so it is more difficult to get new clients. Not to worry, Insurance Company F is almost always offering new contracts at their $94 rate, and has pretty decent enrollment, so therapists can make between $21.60 and $27 per hour before taxes, benefits, student loan payments and vacation time. Not bad for a Ph.D.     

Finally, even if a therapist is able to get credentialed with an insurance company (or companies) with high enrollment and higher reimbursement rates, if their client switches insurance carriers, and the therapist is not credentialed with the new company, the therapist will lose that client (and that income).  Or, if the therapist is credentialed with the client’s new insurance carrier, the therapist will have to accept that carrier’s rate, which could be much lower than the rate they were previously receiving. Further, if a client stays with the same carrier, but changes plans, the client may no longer be able to afford their co-pay/coinsurance/deductible and may terminate therapy, and the therapist will experience a loss of income.   

Pay Rates Do Not Reflect Therapist Efficacy, Complexity of Treatment, or Effort Level

As I’ve discussed, pay rates vary widely, and somewhat arbitrarily, depending on whether insurance companies with higher reimbursement rates and higher enrollment numbers are offering contracts in a particular area.  Let’s consider for a moment another factor, complexity of treatment, which is tied to effort level, using two hypothetical therapists.

Therapist A lives in an area where Insurance Company A is offering new contracts at a $130 rate; Therapist A’s treatment specialty is personal growth and her clients tend to be very high functioning individuals, diagnosed with Adjustment Disorder, Unspecified.  She is able to see 20 clients per week.

Therapist B lives in an area where only Insurance Company F was offering new contracts at a $94 rate.  Therapist B’s treatment specialty is trauma treatment; she utilizes a deep, internal processing approach with clients that is effective but intense and emotionally draining for her and her clients.  Her clients are typically diagnosed with Posttraumatic Stress Disorder (PTSD) and Major Depressive Disorder (MDD). Because of the intense work she does with a high-risk population, Therapist B is only able to see 10 clients per week, while still ensuring a high level of client care and time for personal care.  Both therapists are great at what they do, but for reasons completely unrelated to their efficacy, treatment complexity, and effort level, Therapist A makes much more than Therapist B. In fact, Therapist B can’t even pay her bills.

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Contributes to Therapist Burnout and Devaluation of Mental Health Unhelpful beliefs about money and helping people lead to burnout.  Specifically, there’s a belief in society that people shouldn’t expect payment for good deeds, and if someone does, that is bad, and that person is also bad.  Along these lines, there are beliefs that money is bad or represents greed (Truffo, 2007). Interestingly, we all need money to survive, so these beliefs create a double bind.  An extension of these beliefs about money relates to therapists’ work as therapists: If therapists make their living providing good deeds to people, therapists are bad if they expect to be paid well, if at all (McLain, 2016).  The problem is that this belief is not practical or even very useful. The belief actually contributes to a larger problem, martyrdom. Society loves martyrs; they are good; they died for their cause; we should all aspire to be them.  The problem is, martyrdom is not sustainable; in fact, ask any martyr how martyrdom turned out for them and you’ll learn that it’s not sustainable. Putting others’ needs ahead of our own leads to all sorts of unhelpful dynamics that can be played out unconsciously, but the main one I’m going to point out is that it leads to burnout.   Burnout is a process that starts with putting others’ needs ahead of our own, telling ourselves that we are okay with it, attempting to push down feelings of resentment, unsuccessfully pushing down/fighting off feelings of resentment, and ends with feeling embittered and exhausted.  Facilitating martyrdom, resentment, embitterment, and exhaustion is the antithesis of the therapeutic process. Not only that, it’s poor role modeling for clients. In putting clients’ needs ahead of therapists’ needs, therapists create an unsustainable professional existence, not only for therapists as individuals but for the field.  Credentialing with the insurance companies requires therapists to make sacrifices of their time and money, in order for others (clients) to utilize their insurance plans. Therapists are expected to work a portion of the week for free and accept a salary that is not sustainable or commensurate with their training level to benefit another person.  If that isn’t martyrdom, I’m not sure what is. Not only is the salary insufficient, it perpetuates the belief that therapy is not valuable.  By accepting a rate of pay that is not sustainable or commensurate with their training level, not only are therapists martyring themselves, therapists are perpetuating the belief that therapy is not valuable.  Therapy is invaluable.  Therapists help heal people’s pain and change their lives.  I think many therapists fail to recognize this. Most therapists feel called to this work, find that their work just comes naturally to them, and can’t imagine working in another profession, which may be why therapists don’t see the value in their work.  Casey Truffo (2007) talks about this in her book, Be a Wealthy Therapist; she discusses the idea that helping people heal themselves is normal to therapists, just like drinking water, and therapists fail to see what the fuss is all about.  Normalizing the value of therapeutic work is also likely why therapists don’t feel they need to be paid more, don’t see the costs involved in their work, and focus on what others need, not asking for what they need (or feeling that they deserve to ask).  When therapists credential with insurance companies, they don’t have the ability to ask for more, more money or more time to take care of themselves, because they are bound by the pay rates and time requirements of the insurance process. Self-Care is a Pipe Dream Therapists asking for more time and money to take care of themselves isn’t a luxury, it’s a necessity to create a sustainable individual existence and sustainable field.  When therapists get home after a full day of clients, they often have nothing left to give and the work can have a detrimental impact on their personal lives. Remember Therapist B?  I discussed that her specialty is in trauma and she utilizes a therapeutic orientation that requires deep, internal processing of trauma with clients; this work is exhausting and heartbreaking. Depending on her client load and the issues addressed, some days when she gets home, she can only sit on the couch and stare like a zombie.  She’s not able have a conversation, make dinner, or engage with her partner or children in a meaningful way. On really tough days, she cries, is crabby, and needs a lot of emotional support from her partner; it might take her a day or two to get back to feeling like herself again. On really, really tough days, she experiences harassment, emotional abuse, boundary violations, and even feels scared for her life and safety.  And she has reason to feel scared, one of her colleagues was killed by a former client. The risks she takes and the sacrifices she makes in the service of helping others are real. It is impossible for this work not to affect therapists as individuals, no matter how great their boundaries are.  This is because the therapeutic process works when therapists are able to fully engage with their clients and truly feel their experience alongside them; this process is emotionally draining.  If you don’t work as a therapist, you can probably relate if you’ve ever supported a friend or family member through a painful time. The process takes an incredible amount of emotional energy and leaves you depleted.  This is a huge sacrifice to make for another person. I’m not saying people should stop supporting loved ones or stop providing therapy, I’m saying that therapists need consider the value of their work and the costs they incur to their health and personal lives.  And, if therapists want to continue to do their work effectively, they need to make sure they are taking care of ourselves in a way that recharges their depleted emotional energy. This also means being compensated in a way that prevents therapists from feeling resentful about the sacrifices they are making to help others, and that gives therapists the ability to take incredibly good care of themselves, in order to recharge their energy.   It might be helpful to conceptualize therapists’ work schedule and compensation rates like the work schedule and compensation rates of professional athletes.  Like professional athletes, therapists’ visible work, the hours they are paid for (direct client contact hours) are a tiny proportion of the work they actually do in order to show up as therapists (Powers, 2017).  Prior to starting in practice, therapists spend around a decade training to become therapists. After that, therapists spend hours each week, training to continue their work as therapists, not only doing formal consultation and training, but doing individual process work, so they can show up for their clients without letting their own issues cloud their perceptions and take up too much space in the therapy room.  Therapists also spend hours each week taking time for self-care to recharge their emotional energy. Therapists need to be paid well for their time “on the field”, because the rest of their time spent working is not compensated. The amount and type of self-care time therapists take needs to be commensurate with the amount and type of emotional output.  In other words, self-care for a therapist needs to be on a different plane than self-care for the average person. By self-care “on a different plane”, I mean retreats, long, restorative weekends with best friends, trips to beautiful places, gourmet meals, massages, hours and hours spent in favorite activities without any other responsibilities, anything that is self-indulgent.  These activities need not be material or expensive but they need to be restorative and about taking care of only the therapist, and not partners, kids, family members, or friends. Unfortunately, insurance reimbursement rates do not allow therapists to create a sustainable income and take the time necessary to take care of themselves. Therapists end up needing to stretch their boundaries to see as many clients as possible to earn a decent living, and doing so does not allow therapists to practice from grounded place of their needs being met and energy restored.


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Creates a Diffusion of Responsibility for Care

When people use an insurance plan to pay for medical or mental health services, three parties are involved in the care of one party and a diffusion of responsibility takes place.  This diffusion of responsibility facilitates a fallacy that someone else is paying for the client’s services: “Insurance is covering it.” The client is ultimately paying for services via the insurance plan they’ve purchased, but the onus of responsibility rests on a third party, or appears to rest on a third party.  Why does this matter? Well, when someone pays directly for a service, there is a clear, reciprocal exchange. I provide a service and you are responsible to pay me for the service. When a third party is involved, the responsibility is diluted or “diffused”. The client pays for a financial service from the insurance company, receives a healthcare service from a therapist, and the third-party financial service is required to pay the provider for the healthcare service that was provided to the client.  Do you see how complicated that is? The client is no longer responsible to pay directly for the healthcare service they received; the financial service they hired is responsible to pay for that service.

Further complicating this exchange is the fact that the insurance contracts are incredibly complicated, most people do not understand the contracts (McKennon Law Group PC, 2017) or their financial responsibility.  So, when the third-party financial service doesn’t cover part or all of the healthcare service for some reason, perhaps the deductible has not been met or they claim that the service isn’t covered under the umbrella of the financial service, who takes responsibility?  Theoretically, the client does, but what happens in practice? The client often feels jilted by their insurance company because they are operating under the false belief that the insurance company is supposed to cover their healthcare expenses, and the client is upset (often with the provider) because now they have to pay the provider for a service they can’t afford, and likely wouldn’t have purchased if they’d known they’d have to pay for it directly.  And, what happens when the insurance company says, “I am not going to pay for the healthcare service you received because your provider didn’t follow our convoluted rules” (i.e., your provider provided your healthcare according to best practices, rather than according to most cost-efficient practices) and now you are responsible for full costs? The client is not going to believe that it’s their responsibility to pay for their healthcare services because their insurance company told them that their provider did something wrong.  This damages both sides of the therapeutic relationship: The client feels that their provider has cheated them and the provider feels their client has cheated them. Meanwhile, the insurance company adds the unpaid service to its profit margin. The involvement of a third party in what is supposed to be a reciprocal relationship between two parties, one providing a service and the other receiving the service, creates a diffusion of responsibility; and when that third party is motivated by its profit margin to pay out less in services than its client pays in for services, a conflict of interest develops.

Clients Take Risks They Wouldn’t Otherwise Take (i.e., Moral Hazard)

Related to diffusion of responsibility is the concept of moral hazard.  When someone else (e.g., insurance company) is responsible for the risks (e.g., financial) another (e.g., therapy client) incurs, the less responsible party (e.g., client) behaves differently than they would under maximum risk exposure (Wikipedia).  For example, a teenager who buys his own car is more likely to take his ownership responsibility seriously, taking better care of the car, compared to a teenager whose parents buy him a car. Let’s consider how this is relevant in therapy. To begin, the financial responsibility for therapy isn’t felt by the client; they do pay for the service, but indirectly by paying for another service (i.e., insurance).  The concept of moral hazard would say that the client would be more likely to take on financial responsibility they might not be able to afford if someone else is supposedly responsible. Further, if clients did bear the full, direct financial responsibility for therapy (by paying for services directly), they would likely not seek services unless they could pay for the services. By purchasing and utilizing insurance, clients are putting themselves in positions of financial vulnerability and are likely unaware that they are doing so.

Discourages Client Responsibility for Payment and Treatment

The concept of enlightened self-interest also explains which party is most motivated to ensure a payment is made (Powers, 2017). When the insurance company won’t pay a claim and especially when the reason(s) for rejecting a claim is(are) pinned on the provider for allegedly not following the convoluted rules, who is most motivated to make sure the claim is paid: the provider, the insurance company, or the client?  The party who is most motivated is the party who stands to lose/gain the most; that is the party who isn’t being paid for a service they already provided, the therapist. As a result, the therapist is highly motivated to spend additional time, fighting with the insurance company to try to get the claim paid. Further, if the insurance company refuses to pay the claim, asserting that the provider failed to follow an obscure rule, the client is exempted from their responsibility to pay for the service that they already directly received.  Even if the insurance company does not blame the provider for the rejection, the client has little motivation to pay the claim, given that they have already received the service. The therapist is in a one-down position. Imagine the strain that this lack of reciprocity puts on the therapeutic relationship. Even if the client pays for the service that wasn’t covered by insurance, how are they going to feel, initially going into the relationship with the therapist, believing that all services will be covered by a third party, and then incurring a large bill?  Who is the client going to be upset with? Perhaps their insurance company, but how about if the client has attachment problems? And, how about if the insurance company blames the provider for the insurance company’s refusal to pay the claim (e.g., “provider provided a service that was not medically necessary”)? And, what does this process communicate about who is responsible for the client’s care? Taking insurance doesn’t benefit the therapist, it benefits their client. Therapists are being paid less than their market rate, and they have to do a great deal extra, unpaid work so their client can use their benefits.  This isn’t fair to providers.

Not only does the concept of enlightened self-interest identify the party with the highest level of motivation to ensure that claims are paid, enlightened self-interest speaks to personal responsibility for recovery.  Like the teenager who purchases his own vehicle, when people pay for something directly, they are more likely to be motivated to “get their money’s worth”, putting more time and energy into their investment. They now assume ownership of the service they have purchased and see recovery as their responsibility, as their recovery.  When it appears that someone else is paying for the service (e.g., insurance company), even if this is a false perception, the level of ownership is diminished, as is level of responsibility for recovery.  

Adding another layer of complexity to the impact of third-party payment for a service is the fact that when a third party pays for a service, that party assumes power over the type, amount, and frequency of the treatment because that party is paying for the service.  That party is motivated to keep costs of services down to maximize profits. Curiously, in the case of health insurance, that party isn’t actually paying for the service, the client is, indirectly. Yet, the third party assumes control over care. By involving a third party in payment for mental health services, clients give up control over their treatment.  The insurance company is not doing the client any favors by offering their health insurance service, and neither are therapists by accepting insurance. The client still pays for treatment, but has little control and ownership over their treatment and recovery. Is this a practice we want to perpetuate by continuing to accept insurance and following the treatment practices dictated by insurance companies?

Discourages a Reciprocal Therapeutic Relationship

Even if all claims are paid without any problem, lack of reciprocity between client and therapist still occurs. According to Cialdini, the rule of reciprocation states, “…we should try to repay, in kind, what another person has provided us” (Cialdini, 2009, p. 19).  How can a reciprocal relationship exist when one person provides a direct service and someone other than the person receiving the service pays for it? Further, what happens when that third party doesn’t pay for the service or pays a pittance for the service? When a relationship is not reciprocal, a power imbalance develops; in this case, it’s a power imbalance with the therapist in power and the client in a position of indebtedness.  This type of dynamic is not only counterproductive but can be harmful in the context of any relationship, especially the therapeutic relationship. It places an already vulnerable individual in the position of increased vulnerability and leaves them open to exploitation. This is the antithesis of the dynamic we want to create in therapy.

Enables the Harmful System to Continue

By credentialing with the insurance companies, and doing to the work to ensure that they pay for their clients’ services (because they want to get paid), therapists insulate their clients from their insurer’s devious behaviors, and they enable a harmful system to continue to exist.  Consider this example, if a mother protects her children from their abusive father by taking the physical abuse herself, is she actually protecting them? No, she’s not. The way to protect her children is to get away from that man; that is the only way they can all be safe. Further, how able is she to help and protect her children when she’s being abused?  Not very well. And, how able is she to change the dynamics that exist in that abusive situation and begin the healing process while she is still living in it? That will be a nearly impossible task and any therapist who works with her is going to focus on getting her out of there, not on trauma treatment. In fact, trauma treatment is contraindicated in situations where someone is actively being abused.  Do you see where I’m going with this? If therapists don’t agree with the health insurance system and think it’s harmful to people, including themselves, then they need to get out. Therapists need to make changes from the outside and stop helping to support the system from the inside. Therapists are impotent to make changes when they are dependent on their abusive partner to pay their bills.

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The Fall of Private Practice Under the Third-Party Payer Model

If therapists aren’t yet convinced that accepting insurance is not in their best interest or in their clients’ best interest, we should talk about the future of mental healthcare under the current insurance system.  Under this system, the field of physical medicine has been turned into a factory, with talented physicians turned into assembly line workers, expected to provide an accurate assessment, diagnosis, and treatment in under 15 minutes, and another accurate assessment, diagnosis, and treatment after that, and another accurate assessment, diagnosis, and treatment after that, ad nauseam.  The field of mental health is also turning into a factory, and therapists into assembly line workers, utilizing a Western Medical Model that pathologizes abuse, neglect, and other traumas and utilizes briefer, symptom-reduction-based treatments that do not necessarily address underlying problems. Providers have been forced to change treatment approaches, and abbreviate treatment, experiencing reductions in allowable treatment session length, treatment frequency, and treatment duration.  Ultimately, therapists are not able to practice according to best practices if they would like to receive insurance reimbursement.

It is my understanding that the plan is to phase out the smaller clinics and independent practitioners because it’s much more cost-effective to contract with one large clinic than many small clinics.  Not only are there fewer contracts to write and manage, larger clinics are able to offer on-call services, which apparently cut down on inpatient hospitalizations, and ultimately, cut costs for insurance companies.  Indeed, insurance companies in the Twin Cities Metro area and Duluth, Minnesota have already begun to refuse contracting with new clinicians, unless they are part of a group contract with a larger clinic, so this phasing out process has begun.  Additionally, to cut costs, insurers are rolling out therapy apps to cut down on costs of paying actual therapists, further pointing to the start of a phasing-out process. I could be wrong, but it looks to me like Rome is falling. And, as with the fall of the Roman Empire, the smart Romans left before it fell (Powers, 2017).  My advice to therapists: When in Rome, leave before the Empire falls.

How Providers Can Evolve and Take Their Power Back

Even if this article has convinced therapists that it would be in their best interest and their clients’ best interest to get off insurance panels, raise their rates, and move to private pay, the rationale and fears I discussed in the beginning will probably keep them stuck.  So, I’m going to provide some suggestions to address each of these.

  1. It’s what everyone does.  I’m going to challenge you to challenge the status quo.  It’s terrifying, trust me, I know. (I was terrified to write this article.)  Courage is about being terrified but doing something anyway. If you aren’t already working with your own therapist, I’d encourage you to get a therapist and work on some of the fears you have surrounding challenging the status quo.    
  2. Ensures a steady referral stream.  If you learn how to market, you can develop a steady referral stream without being dependent on insurance.  Begin networking with other small business owners who have been successful and get to know successful private pay therapists.  There are a lot of really great free resources online that will teach you to market your therapy practice. There are also a lot of courses you can purchase, books you can buy, and/or consultants you can work with to help you learn to market.  Further, many of the consultants offer free resources via podcasts, blogs and mini-courses. I’ve mentioned many of them below.
  3. Provides access to a wider demographic; an opportunity to “give back”.  I don’t believe that your business is necessarily the place to give back (or that you need to give back more than you already are as a therapist), but if it must be, please follow the airlines’ moto, “Secure your oxygen mask before assisting others.”  Until you are in a place of financial integrity, it is not the time to give back. And when you are in a place of financial integrity and if you insist that you need to give back through your business, you can offer some sliding scale or pro bono spots.  However, there are some dynamics that can play out when offering services for reduced rate or free, so please be aware (McLain, 2018). This also might be something helpful to work on with your individual therapist. I’ve also included some books addressing financial integrity below.  
  4. Skills deficits and fears related to running a business get in the way.  For the skills deficits, again, there are a lot of great, free resources and courses to help you learn to run a business (e.g., “Selling the Couch Podcast”); there are also some great courses you can purchase (e.g., “Abundance Practice Building”; “Your BadAss Therapy Practice”), books you can buy (e.g., Profit First; The Dip; The Millionaire Next Door; The Total Money Makeover) and/or consultants you can hire to help.  Network with other successful professionals and figure out their methods.  For the fears, I would specifically like to address the fear, “No one who buys insurance will pay extra to see me.”  Yes, they will, and they are actually paying someone right now; that person is called their life coach. And, their life coach is charging them between $200-$667 per hour for a service you are fully capable of providing (Burza; Marver; Stimpson).  As I mentioned before, working with an individual therapist will be helpful in overcoming your fears. Books such as Be a Wealthy Therapist, podcasts such as “The Practice of Being Seen”, and courses such as Tiffany McLain’s “Lean In. MAKE BANK.” address many of these fears and provide opportunities and exercises for therapists to work through these fears.  

If you, as a therapist, want to remove yourself from insurance panels and move into the world of private pay, it will be scary (terrifying) and will require learning some new skills, but it is possible.  And, if therapists want to create a sustainable existence for ourselves, our clients, and our field, we have no choice but to evolve and make a paradigm shift. With any paradigm shift, there will likely be an upheaval and chaos as we all adjust to the new way, but such is the nature of challenging the status quo.  The alternative to evolution is fairly undesirable.

Now it’s YOUR turn!! What is the #1 takeaway YOU have after reading this article? Share your wisdom, ideas, disagreements and ah-ha moments in the comment section below!

Brianna Mann, Ph.D., provides OCD treatment, PTSD treatment, and anxiety treatment in the Lake Minnetonka, Mound, and St. Louis Park, Minnesota areas. Brianna has been a therapist, specializing in the treatment of anxiety for 13 years; for more information, please see

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  1. Dee

    There needs to be a change that allows people who need mental Health care to actually get it. Socialized medicine is the only answer for us all. Cash is only possible for a certain number of people in a certain social class. Many people who need therapy can not afford any out of pocket. Should they be prevented from getting help when they need it? The system does need to change. Seeing cash pay only is not the answer or an option for many. COVID will leave many people out of insurance and with no money. So no help??? There IS another answer. Take profit out of healthcare. Destroy insurance companies and focus on people. Socialized medicine means everyone, all the time, getting healthcare, as a nation we need to value people ot the profit as without the people there is no money anyway

    • Tiffany

      Thank you for sharing your insights!

      I’m all for systemic change AND I believe therapists who are burnt out, stressed, financially strapped and emotionally crushed are in no shape to step up and change the system. I’m a big advocate on getting therapists well-resourced so we can make these big changes.

      I’m also a big advocate for clear, strategic action items with timelines.

      I’d love to hear what steps we can take collectively to make this happen, along with a clear deadlines for each step AND any suggestions for organized organizations that are implementing these steps that we can contribute our time and money towards.

      THANK YOU!

  2. Gwendolyn E Nelson-Terry

    I’m rather new to the PP area. I started my practice after moving to a new city. As I got out in the community and started to network with other therapists I learned that almost everyone in the city took insurance, it seemed to be that it was just how things were done. I signed up for a few panels – one with shockingly low reimbursement rates. What I learned from the experience is that (there are always exceptions to the rule) client’s who use insurance have way less of a buy in to the therapy process. They tended to be the client’s who cancelled last second, which was a pain because a lot of the insurance companies don’t reimburse for late cancellations and they also do not allow for the therapist to charge for late cancellations. Insurance client’s also tended to the the client’s that showed up for 2-3 sessions and then ghosted me. I also noticed that being on panels didn’t insure a steady stream of referrals. In fact I didn’t get many insurance based client’s at all. I decided to start the process of leaving insurance panels and to focus on learning how to market. I’m struggling with this a bit but I also know that it is possible to be in PP without the hassle of insurance.

    • Brianna Mann

      Hi Gwendolyn! Thank you for weighing in with your experiences. Yes, the power of the status quo is strong in us. It is so upsetting how low the reimbursement rates are (and the fact that we aren’t allowed to discuss them specifically under threat of losing our contracts–I am pretty sure that restricting freedom of speech is unconstitutional, but I digress), so low that some of them barely cover overhead! The experiences you mention are totally speaking to the concepts of moral hazard, enlightened self-interest, reciprocity, and diffusion of responsibility. They are also similar to complaints I’ve heard from other therapists. Way to take your power back and go out on your own!

  3. Kimberly Jackson

    Thanks for taking the time to compose this narrative, but I disagree with some of the fundamental assumptions. For context, I am in-network with ONE insurance provider and the rest of my clients are private pay. I have an integrated EHR that facilitates electronic billing quite easily and I usually receive payment from the insurance company within 1 week of submitting the claims. For most of these clients there is an unlimited number of visits and no authorization/ treatment review is required. It seems that you are depicting a worst-case scenario in this blog post rather than acknowledging the variance that may exist from one insurance plan to another.

    Furthermore, I object to the concept that an insurance client requires 30 additional minutes of work per week in comparison to private pay clients. Best practice would dictate that we are writing session notes for ALL of our clients, regardless of whether it is required for payment, continued treatment, etc. It is also likely that to obtain a steady stream of private pay clients one must spend additional time each week, month, etc. writing online content, marketing, networking, etc. It all balances out in that regard.

    I agree that the fixed terms of the contract may be problematic and do not seem to be adjusted from year to year to reflect cost of living increases. However, for therapists who are in the beginning phases of practice building and may lack a safety net or nest egg starting out I think that being on at least one insurance panel can be helpful and minimize some risk.

    • Tiffany

      Thank you for sharing your perspective, Kimberly! I know for a fact that a lot of therapists have had similar experiences in regards to insurance. It’s always helpful to have a variety of folks with different viewpoints speaking up and making waves!

    • Brianna Mann

      Hi Kimberly! I’m glad to hear that you haven’t had problems with the insurance companies; that is as things should be. In terms of amount of time the insurance process takes, I was speaking from the perspective of the clinicians I’ve informally surveyed and from doing some of the business administration work of a group practice, including the cumulative time spent in all aspects of insurance (e.g., credentialing, contracting, paperwork to authorize additional sessions, going through EOBs to make sure sessions were reimbursed, determining client portion of payment and collecting payment from clients, calling the insurance companies to discuss discrepancies, being upset about how much additional work you need to do to get paid, etc.). Certainly other people have had different experiences and the experiences are likely different for different insurance companies and for different clients. Yes, best practices do indicate that we should be taking 30-60 minutes of time for each client (for a variety of activities); I meant that insurance adds 30 minutes to that, for a total of 1-1.5 hours out of session. You are right, marketing does take time. I would argue that if done with intentionality, marketing can be an extension of therapists’ values systems and comprised of activities that therapists would be doing anyway (or would rather be doing). For example, meeting new colleagues to form a support network for therapists and provide opportunities for case consultation; public speaking or writing on social justice issues; providing education on mental health to other professionals or the community. For me, taking time on the insurance process does not serve my values system because I do not agree with the way the system “works” (I talk more about this in the longer version of my article), so I would prefer to spend my time marketing. Others may see this differently and that is their right. And, you are right, taking insurance certainly provides a safety net for clinicians in the early phases of practice and I understand why people go that route.

  4. Jennifer Chain, Ph.D.

    I absolutely love and agree with all the points mentioned in this article. Another point that I want to add is that research has shown repeatedly that when more women enter into a field that was dominated by men, the pay drops. I believe this is happening in the field of psychology/mental health. Therefore, I believe it makes not only economic and business sense, but it is a social justice imperative for therapists to leave insurance companies and charge what we are worth.

    • Tiffany

      Oh my GOSH! I love this comment, Jennifer. I’ve heard it similarly described as the Glass Cliff – when traditionally underrepresented populations begin entering a field, it is a sign that that industry is about to drop off a cliff. Fuck no! Let’s change it, starting with US.

    • Brianna Mann

      Hi Jennifer and Tiffany! Absolutely! I completely agree with this and the injustice of it really gets my blood pressure up. I talked about this a little in the section entitled “Substantial Salary Reductions Over Time” in the longer post. We have flipped from field that was 70% male to a field that is 70% female over the past few decades. In 1994, one insurance panel was paying $150/session; that same company is now paying $130/session; $150 in 1994 is $253 in 2018. The medical field remains around 70% male and salaries are much higher.

  5. Sarah Lavoie

    I know she’s right. When I was first starting out, insurance panels were a savior and helped me get lots and lots of clients in the door. Now that I’ve been licensed for over 5 years and in practice for about 3 years, currently living in the most expensive city in the country, and making less than both of those example payments from insurance in the article, I have absolutely been considering going off panels. I made so little income last year I felt like a failure. Considering that this year is more than half way over, I know the numbers are just as promising. But, again, she is right. I’m afraid. Afraid I’m not good enough, that no one will pay, and that I’ll never find clients. Actually, I’m more afraid of what I think I have to do to find those clients. The idea of going out and doing public speaking presentations or cold calling doctors is so scary to me, I’m uncomfortable just thinking about it. I know there are lots of therapists out there making money, I just don’t believe I can be one of them, not if I have to do those things. I am also afraid of spending a lot of money to someone to help me get clients, and then have it not work. I have been thinking about a few different programs to try. How do I convince myself to make the leap.
    Another thing, I also use insurance to pay for therapy. I can’t bring myself to pay out of pocket at the rates I would want to charge, so how can I expect someone else to?

    • Elaine

      I think this was a great article and can really relate to Sarah Lavoie’s comment. I’ve been home with our special needs child for 16 years and am at a loss as to how to get back into the field. (I’ve been licensed since 2000.) I find it hypocritical that therapists want to ask for top private pay rates, than admit they are unable to pay for therapy themselves. Why don’t therapists compromise by lowering rates and avoiding insurance panels altogether?

      • Tiffany

        OR! Keep fees high and also avoid insurance panels, thus ensuring they can pay their own therapist full fee. AND – I’m excited to hear that you’re getting back into it. There are SO MANY resources out there – both paid and free – that will help you build a solid, cash pay private practice. As long as you’re consistent and willing to try things that feel scary, you’ll succeed. Given that you’ve spent 16 years caring for your special needs child, I know that you’re not short on commitments, consistency and a willingness to put in the hard work. You have SO much to give and there are clients out there who will be lucky to have you.

      • Brianna Mann

        Hi Elaine! Thank you!! It sounds like you have been continuing to do good work, even out of the field! I think you and Sarah are both onto something regarding the dissonance between what we ask for and what we do. Resolving the dissonance will likely help us move forward. I think a lot of us have internalized the societal value of mental health, which is that it is undervalued/devalued. According to social psychology, we have a cognitive bias that says expensive = good/valuable and inexpensive = bad/not valuable (Cialdini, 2009). I talked about this in the longer version of my article in the sections “Health Insurance Facilitates the Undervaluing…” and “Discrepancies in Salary…”: “We place more value on manufacturing a widget, how fast our money can grow, moving our consumer goods across the country, and almost as much value on the training of our pets than we do on our well-being.” I agree with Tiffany, I think we should keep our fees high and avoid insurance panels!

    • Tiffany

      Sarah! You’re not alone. I know a ton of therapists struggle with exactly these same questions. I am working on a massive article about the marketing piece, but I’d like to challenge you on something. I bet you have clients who struggle with certain fears that keep them from living their fullest life. I have no doubt that, by taking the leap and taking these risks that scare you, you will be a better clinician, better able to help THEM navigate through their fears and take action. So, that being said, what is a re-frame you could employ to go from letting fear dictate your actions to… something else?

    • Brianna Mann

      Hi Sarah! This is such a stuck place to be in. I can absolutely relate and know lots of other therapists who can too. It makes me so sad that our field is filled with beautiful, talented people, making the world a better place and we are all struggling to get by and feeling such self-doubt and insecurity. “Being seen”, which is what is required to market, is TERRIFYING! I was so scared to be seen by writing this article that I immediately and literally became sick to my stomach when I sent this out to my reviewers. As much as I wish there were a way around this, I think it just requires practice and lots of self-compassion. There are certainly less scary places to start (e.g., reconnecting with old colleagues/professors/classmates) but it’s still scary. I would really recommend a course or even some books (e.g., Be a Wealthy Therapist) if you can’t afford a course. Tiffany’s Lean In. Make Bank. course was amazing to push me to challenge my fears around being seen/not good enough/scarcity/hopelessness/others’ rescuing me; it accelerated a process that would have taken at least another year in therapy. By the way, she didn’t ask me to say this 😉 Yeah, I totally get the dissonance around not being willing/able to pay your own therapist your private pay rate. I know this is scary and may sound crazy, but I save up some money, then dropped my insurance plan and requested to go private pay with my therapist, and now pay for all medical expenses out of pocket. I’m still scared that I’ll run out of money but I feel better doing this.


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About the Author

Hey, I’m Tiffany McLain, LMFT, and I teach you how to charge good money for the good work you do.  I’m the founder of Lean In. MAKE BANK. Academy, a group program that empowers therapists and social workers like you to reimagine your relationship with money, offering the tools and community support to not just earn more but to fundamentally change your life and the lives of those you serve.

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