I truly believe that medical insurance is one of the greatest inventions of the modern world. The idea that people can get the care they need for emergencies and unexpected events is fantastic.
While I could have opted out of medical insurance to save money while I was in college, I never did. I understood how valuable of a resource insurance is. And yet, as a business owner, I have decided that I will not get on insurance panels.
In fact, some people in the world have the notion that Kelly and I hate insurance because we talk so much about private pay practices. It isn't that we hate insurances... it is just that we often wake up to messages like this one from our clients:
This person had done everything right. They had outsourced their billing to someone who was supposed to be verifying coverage and was an expert in insurance. (Hot tip: When interviewing someone to outsource your insurance billing to- make sure they are going to verify before EVERY appointment and document that- not every insurance biller includes that level of service). They had submitted the claim in a timely manner, completely filled out, and they had been paid. They had completed important work with the client and closed the case file. So now, what to do?
"The insurance company is requesting I pay back over $200. There was a post payment claim review for claims paid on 6/29/14 and 7/1/14 that they say subscribers contract was canceled on 3/1/14. I was looking through the contract tonight and they clearly state I(we) have 120 days to submit claims but when it comes to their right to recall funds already paid...there is no length of time indicated. Miranda, this is a great example of why not to take insurance. the $$ I spend on outsourcing my appeal vs paying fund back or the time it takes me away from other work. I can go on and on..."
Getting on insurance panels in private practice
Most therapists we work with are one man shows. They may outsource a few tasks, or have a part-time contractor- but they are the primary source of income for their business. Navigating insurance panels as a provider is a full time job.
Why Insurance is a Full Time Job
When is the last time you went into a doctor's office and saw the doctor submitting insurance claims? How many staff people work in the office? The truth is, most of the time the doctor has more than one full time person keeping the insurance train moving forward. And yet, most therapists are trying to navigate not just one, but many different insurance panels.
Diversification is Fabulous
Normally, I would say that diversifying your streams of income and your referral sources is awesome- but that means you have to read more than one contract and learn an entirely different process. While I have worked with some awe-some insurance companies while in private practice- too many of them have practices that are shady.
Are Insurance Companies Shady?
Ok- maybe I don't have proof they are shady. However, I have spoken to people who have worked for insurance companies who have verified that insurance companies reward for things like delaying payment, denying payment, etc. Example: You fill your paperwork out perfectly. You submit timely. The same insurance company always bumps it back. Then, you realize you can re-submit the exact same paperwork and it will be paid the second time. How many people don't resubmit the second time? How much interest do they get on money they can hold in their accounts for one more month?
Let's Get Helpful
Here is the truth, we aren't here to bash on insurance companies or say they aren't an option. But, here are some tips to help you make the right decision for you, and go in as an empowered therapist:
- Talk to other local therapists who are on the same panel before you sign up. Ask them how easy and simple it is. Ask them if there is anything that just isn't making sense- or that feels like a run-around.
- Read the entire contract and all supplements... carefully. I know this may seem crazy. Or, you may determine there is over 300 pages of material and say "I don't have time for that." If you don't have time to read and understand the contract- maybe you don't have time for insurance. And please understand when the contract says "they agree to do everything in blank handbook"- that means the handbook is part of the contract.
- Be honest with yourself. Did you keep up with your paperwork and love keeping everything organized and buttoned up when you were working at an agency? Or, did you need other people keeping you accountable and did you dread all the forms?
- Create a business plan. Sit down and determine what you need your fee to be in private practice to have a sustainable practice. You can't squeeze blood from a turnip. Or, in other words, if you determine you need an average of $80 per session and the insurance company is offering you $40 a session- the math doesn't add up. You can take our free how to set fees training here.
- Seriously consider outsourcing to someone awesome. You need someone who has expertise in mental health and is available for you 24/7. Your billing person basically becomes another arm of your business. Here is an interview we did with one private practice insurance biller.
- Create a clinical vision. Be real with yourself about the type of clinical work you want to be doing. Does it align with medical necessity? If you prefer to preventative work, getting insurance reimbursement will be difficult. If you like working with major mental illness and use an evidence based approach- it may be a good fit. If you like working with major mental illness and are using a cutting edge technique that is not fully researched yet- you may have difficulty getting paid.
- Connect with awesome resources. Barbara Griswold of Navigating the Insurance Maze is one of my favorite peeps for all things insurance. She is real, keeps a sense of humor, and has awesome books, articles, and can do individual consults.
I am thinking of putting together a Private Practice Insurance Dictionary- like I did with the Website Dictionary for Therapists. Post your comment below and post any terms you would like defined in regards to insurance.