When Money Interferes with the Therapeutic Relationship

So, you’re a therapist doing the hard and critical work you love.

That is, until it’s time to talk to a client about the co-pays that aren’t being paid, the deductible that isn’t being paid, the cash payments that aren’t being paid, the no shows or late cancellations that leave you irritated….

Chasing down payments from insurance companies is bad enough; chasing down money owed you by your clients themselves after all the work you’ve done helping them is worse.

Not only is this not what you signed up for when you opened your practice after years of studying and testing and all the other aspects of college life – including student loans! – but there’s the potential of your frustration with their non-payments making it difficult for you to be objective regarding their various concerns. And your clients may feel it, even if they can’t actually identify it.

Or, you may decide you have to cut your losses and discharge the client, which again isn’t what you signed up for. (After all, your ideal is to see yourself making their lives easier and more successful, not dumping them over unpaid bills, right?)

Therapists and clinicians, like doctors or any other professional personnel, should not be in the position of having to discuss payments and payment plans with their clients. And we know clinicians who have chosen to write off thousands of dollars owed them, rather than deal with this problem. In our book, that’s just not right. After all, what does your client learn from this? Anything positive at all?

There are ways to address the problem, although none are fool-proof.

First, don’t make your own appointments with new clients. Have an “office manager” – who can be “virtual”, and who all new clients have to go through for that first appointment.

Second, have written policies and procedures in place that are signed off prior to, or at, the client’s first session. Ideally, the client should sit down with the office manager ahead of time, but minimally, those policies should be explained by that office manager, which can be done by telephone, Zoom or some other electronic platform.

Third, send out monthly statements to your clients. If all is paid in full, say thank you with a smiley face or whatever works for you. If there are outstanding balances, add a note asking for prompt payment.

Fourth, when an unpaid balance reaches a certain threshold despite the above, your office manager should call the client in (again, this can be done electronically if necessary), and review the balance, develop a plan for repayment, and keep on that client. This could include the office manager saying “I am recommending your therapist not see you again until there’s progress on this bill because she has her own bills to pay, as well as a waiting list of people who want your appointment slot”. The office manager and/or her staff can be the bad guys and take you, the therapist, out of the equation.

Included either here or before the first session should be a document identifying the various steps in the payment / collections process. At Heritage Health Services, we call it “Payment Tiers” which goes all the way to Small Claims Court.

Heritage Health Services is not a collections agency… not even close. We are an office management company, with extensive experience in the mental health world. We will work with your clients to get payments made, without the negative connotations of dealing with a collections agency.

However you choose to deal with collecting the payments owed you – whether you plan to do it yourself, work with an office manager/bookkeeper, or send everything to a collections agency – promise yourself that you will start today. And do it.

FMI re Heritage Health Services’ supports please contact Linda Snyder, M.S. at 207-740-2247.

Categories: Business Practices

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