You want the time you spend treating clients as a mental health provider valued appropriately. But, considering in-network rates and time spent dealing with insurers rather than patients, is it?

When mental and behavioral health providers, therapists and substance abuse counselors ask these questions about their own businesses, they often start thinking about private pay.

Why being out of network is the answer

At first glance getting off insurance panels may be intimidating. But when you peel back the layers of these arrangements, you start to see that they're not always conducive to practice growth.

The issues in-network

For instance, just take a look at what you’re getting paid. Are the fees that you’re bound to through insurance panels commensurate with the value you offer clients? Or do you think maybe your time is worth more?

Or how about the way you’re asked to treat people—can a client really get over an addiction in the specific number of appointments allotted by their insurer? And should they really have to prove to the insurer that they need more care?

Don’t forget: in order to continue operating this way you inevitably will need to hire a biller. Otherwise, your ability to scale your practice will be severely limited.

These problems are nothing new for mental and behavioral health providers. It’s life in-network. And while there are certainly benefits to running your practice that way, many providers find the negatives outweigh the positives.

Being an out-of-network provider

So why is being out-of-network better? Where's the advantage in leaving insurance panels and being an out-of-network therapist? Running a private pay counseling practice?

The freedom to run your out-of-network practice the way you see fit.

When you leave insurance panels you’re able to set the rates at your private pay practice. If you’re worth $100 a session, you can charge that. If you’re worth $200 then you can charge that too. And if you’re able to effectively communicate your unique selling proposition to potential clients, then they will pay because your care is worth it.

But that flexibility extends beyond rate setting. You’ll have more control over client treatment schedules and day-to-day client flow. You’ll also have the freedom to hire who you want, when you want, rather than feeling forced into hiring a biller.

Instead of working through the complexities of in-network reimbursements, you take payment upfront. Afterward, you create a superbill and hand it off to the client, who files for reimbursement.

You can certainly assist clients with their superbills, but billing at your private practice will be much easier this way.

But let’s not forget...

However, there are certain aspects of private pay practice that some providers may find challenging.

You’re placing a bet on yourself. And that means that it’s up to you to connect with and convert prospective clients. If you’re someone who enjoys marketing and selling yourself and your services, private pay may be right up your alley!

And if you’re not, no worries! Effectively communicating your unique selling proposition isn’t something that comes naturally to everyone. It’s often something you have to learn.

Your private pay practice plan: Going out-of-network

The decision to get off insurance panels is up to you: Do whatever is best for your practice and your clients.

However, if you’re ready to take the private pay path then you’re going to have to do some prep work. It’s a big move—almost like starting a new practice—and you should do it the right way.

And to start you need to determine: How much am I worth and how do I convince prospective clients of that?

Setting rates and selling clients on your private pay practice

You should start by figuring out what rates you will charge. In other words, how valuable is the care you provide and what sort of revenue is required for the lifestyle you hope to live?

It’s important to overcome the misconception that it’s wrong to place too high a price tag on mental health care. Sure, you can’t set ridiculous prices; care should be reasonably accessible. But you shouldn’t be forced into an unlivable wage either.

What’s the proper balance for your practice and the clients you plan on treating?

After all, treating people in the throes of addiction, rescuing marriages teetering on the edge and helping children adapt to intimidating school environments is valuable work. If you don’t acknowledge that, how will your clients?

What’s your unique value proposition?

Your unique value or selling proposition is the reason people should set an appointment at your practice over an in-network provider. This unique selling proposition is the value you offer that other providers don't. Why are clients paying the rates you set?

It’s up to you to decide what this is. It frequently comes from a practice niche or clinical focus. And often, that specialty stems from something of personal interest or importance to providers.

What are the reasons a substance abuse provider enters this clinical focus? Who does he or she hope to treat and what is the mission statement in doing so? Answering these questions for your own private pay practice will help you land on your unique selling proposition.

How to get off insurance panels

There are two options for dropping off insurance panels: Do it all at once or break up with insurers one at a time.

Many providers recommend doing it one-by-one or in chunks. That way you can ensure a steady stream of in-network reimbursement from your better payers as you navigate dropping off the worst insurers’ panels.

Like any other, insurance panels for mental health may require you to jump through some hoops in order to finalize your move toward private pay. You may have to send notice of your intention to drop off panels in writing, for example.

Make sure to read through contracts with all of your insurers before notifying them of your intention to leave. And be persistent in following up.

How to get private pay clients

One of the top fears about choosing direct care over managed care is that you’ll lose clients when you drop off insurance panels.

It’s a totally reasonable concern: Clients gravitate toward in-network providers when they have the option. However, many of them aren’t fully aware of the out-of-network benefits their insurance plans offer. Additionally, if your unique selling proposition is worth the cost of your out-of-network care, clients will pay.

So how do you begin engaging clients—both current and prospective—on this topic?

Start with the clients you have

It’s cheaper to keep a current client than it is to convert a new one. So how do you keep most of your clients when you drop off insurance panels? Communication

After you’ve decided which insurance panels you’ll drop off first, let those clients know. You can email them, call them or give them the update in appointments. Explain why you’re becoming an out-of-network provider, how that will affect rates and what that means for their treatment moving forward.

If you’d like you can offer to help patients with superbills or sign up for an out-of-network billing software to help you streamline billing.

Finding new private pay clients

Chances are if you do it the right way, you’ll be able to leave insurance networks and retain most of your clients. But, if not right away, then before long you’ll probably start thinking about new clients. How do you sell them on the value your private pay practice offers?

It starts with that unique selling proposition. If yours is well crafted and appeals to your target clients, it should sell itself. With your clinical focus and unique selling proposition set, your ideal client should be clear. Not everyone is going to be the perfect client. You should target your marketing and messaging to the sort of client you hope to treat.

As an out-of-network provider, you’ll rely more on your marketing for new clients. And when that marketing generates new leads, you’ll need effective scripts to communicate how you’ll treat individuals.

Enjoying practice freedom as a private pay provider

If you’re able to develop a powerful selling proposition, effectively extricate yourself from insurance panels and communicate that move to clients, you’ll be in a position to grow as an out-of-network provider.

The work that goes into getting off insurance panels pays off with the freedom providers enjoy when they’re out-of-network. This is often true in mental health and substance abuse, physical and occupational therapy, eye care and many other practices.

And if it’s right for you and your clients, we wish you all the luck as you build your private pay practice!