Breaking away from an agency setting to fly solo is an appealing idea to many professional counselors who yearn to provide direct service to their clients and gain control over his or her professional development. But opening a private practice takes more than just hanging a shingle and furnishing an office with a cozy couch and Kleenex. A conscientious therapist may be a bit overwhelmed to find that the tasks they face include myriad business-related details that cannot be ignored. Starting and managing a private practice requires discipline, commitment and a quality that few practitioners learn in their counseling training and even fewer believe blends ethically with psychotherapy business savvy.

But, many counselors simply roll up their sleeves and get down to business. Joyce Breasure, past president of the American Counseling Association and a nationally certified counselor, has managed her own private practice in Delaware for over 20 years. "In the past 20 years private practice has become a major work environment for professional counselors,'says Breasure, who cites the following study as proof.

In 1985, the American Counseling Association conducted a survey of its members from 1982 to 1984 to determine the number of counselors entering private practice. Within those two years, the number of counselors entering private practice increased 68 percent.

In 1983, of the 30,731 members who reported their primary work setting, 2, 629 were in private practice. In June 1997, of 30,760 members who reported their primary work setting, 9,684 professional counselors were in private practice. In 14 years, the number of counselors in private practice had increased by about 27 percent.

What are some pros and cons of owning a private practice? Breasure notes the following:

Pros
Counselors control:

• The policies and procedures of how services are delivered.
• Their own professional development.
• Clinical decisions regarding treatment techniques.
  
  Counselors gain:
• The opportunity to earn a higher income with fewer restrictions.
• Tax deductions on equipment, books and materials.
• Immediate acquisition of supplies without requisitions.

Cons
Counselors are responsible for:

• All problems and errors.
• Collecting fees.
• Maintaining self-discipline required to start and maintain the business.
• Generating income (no paid sick leave or vacation time).
• Cleaning and maintaining the office.
• Advertising.
• Bookkeeping.

The business of counseling

The ability to blend business with counseling is a skill that must be learned to reap the benefits of a solo practice. "Your first task is to know the laws and regulations of the area in which you plan to set up your practice,'says Breasure. "Professional counselors in 44 states and the District of Columbia are regulated, either through licensure or certification.'Because of this recognition of the profession by regulatory bodies, the number of practitioners in private practice will likely continue to rise,'says Breasure.

Insurance matters

The counseling field is a litigious community and private practitioners may operate in what may be viewed as high-risk situations. Breasure, who began teaching ethics 25 years ago, encourages counselors and therapists to purchase as much malpractice insurance coverage as they can afford. The cost of coverage is approximately $200 to $600 for $2 million to $4 million.

"Twenty-five years ago there had to be a huge breach of ethics for a client to sue,'she says." Today, an unhappy client will sue if they didn't like what you suggested or the changes that took place after they followed your advice.'
While some therapists chose to "keep it simple," forego insurance and operate on an out-of-pocket method of payment, others set up computer systems to record and track Medicare and managed care billing. To become a Medicare provider, the practitioner can request an application from the Medicare carrier in his or her area.

Managed care

To become a managed-care provider, practitioners would contact a managed- care company that they would like to work with and request an application. Many therapists are opposed to the system and have abandoned it entirely. "There is every good reason in the world to be opposed to managed care,'says John Klein, an editor of "Psychotherapy Finances,'a newsletter for behavioral health providers published by Ridgewood Financial Institute, Inc., Juno Beach, Fla. "Therapists naturally don't like rationed care. They believe in the service they are providing and they believe, as I do, that there should be more behavioral healthcare not less.'"The nature of managed care,'Klein explains, "is to deliver as few sessions as possible to cut costs.'Other reasons that therapists are at odds with managed care is that the amount of paperwork is burdensome and therapists need to justify every third session to a case manager. "A lot of practitioners make some of their own trouble with managed care. They spend so much time fighting it that they don't learn the system, and they don't learn how to make the best of a bad situation -- they make their own bad situations worse.'

But the therapist who is able to establish a solid relationship with a managed- care payor can develop a steady stream of patients and income. Skills that therapists working with case managers in managed care may need to build are: negotiating skills when requesting more time or sessions for a client; and how to work more briefly than they've been trained to perhaps within 6-10 sessions instead of 16-18.

"While the economy is strong, many clients will continue to pay for therapy, but a recession would change that and therapists would have to depend on some third-party payors.'Klein suggests that practitioners not completely disconnect themselves from managed care, but instead supplement their managed-care income with private pay income.

"Managed care is where a tremendous amount of behavioral healthcare is going to take place so you can't be divorced from that system entirely, but at the same time you don't want to depend on it entirely,'says Klein. "If you find that 70-80 percent of your practice income derives from managed care you are in a downspiral in terms of income, because rates are going down and, so far, there is no bottom in sight. So, if most of your practice is managed care, you can almost guarantee that you are going to make less money next year than you did this year.'

Elizabeth, "Betsy,'Chadwick, MDiv, MSW, ACSW, does not spend energy
promoting herself as a managed-care provider. "I feel strongly that working under that umbrella sabotages my energy, enthusiasm and excitement,'says Chadwick, a certified Imago Relationship Therapist and Reiki II Practitioner.

"I have worked under some managed-care companies happily and I've worked under others miserably. It depends on the company and the plan the person has in the company.'Chadwick says that managed care doesn't allow her the freedom or time to conduct therapy in the manner in which she would like. She also sees a limit to the degree of confidentiality that she can assure clients that use managed care, and cautions them beforehand. "With a managed-care company the person at the 800 number is going to be in the clinical sessions,'she says. "That means that I, the therapist, cannot promise the client confidentiality. And I can't promise clients that I'll be able to do therapy the way I would prefer to do it, because I may be told what to do by the managed-care company.'

Karen Peterson, PhD, prefers serving private-pay clients. By foregoing insurance and maintaining handwritten records, she eliminates onerous paperwork, and doesn't need to keep an elaborate computer program to track sessions, or churn out treatment reports at set times.
"I don't like contracting with insurance companies or any third-party payors for that matter, because by definition, it can create a risk in the therapeutic alliance.'Peterson says that clients get distressed if their insurance company defaults. "It's not my responsibility whether the insurance company pays me,'says Peterson. "The client needs to pay me first and then get reimbursed by their insurance company.'"I personally am not on any insurance plans and I do not intend to be and I used to be on a lot of them.'

The author of The Tomorrow Trap: Unlocking the Secrets of the Procras-
tination-Protection Syndrome, Peterson says that therapists who create a specialty niche for themselves can attract a substantial amount of clients who will be willing to pay out of pocket for the therapist's realm of expertise. "I am a maverick,'says Peterson. "I am very different from many therapists in private practice in that I have a specialty in the procrastination/writer's block area. So, I strongly recommend that therapists develop a specialty, because that enables them to stand out from the crowd a little bit. Clients will come to them and forego their insurance if they feel that the therapist's services are what they need.'Peterson encourages newcomers to private practice to create their own niche. While the caseload may be less, the therapist will be less prone to burnout, able to maintain a higher standard of service and will be paid out of pocket.

"Managed care fees are often 50 percent or less of what the customary fee would be in that area,'explains Peterson. "You can become inundated with clients, you may not have enough time for them and you're not getting paid sufficiently to feel comfortable turning away even moreclients.'

Fees

Fees for counseling services vary according to location. A practitioner starting a private practice should research and compare his or her services to other mental-health professionals in the area to determine a fair and reasonable fee.
Sliding-scale fees are attractive to clients without insurance or whose insurance does not cover mental health because they can receive treatment within their financial structure. "Determining the average co-pay fee in the area is a good base from which to set a sliding scale fee,'offers Breasure.

But setting fees can sometimes be easier than collecting them, admits Breasure. "Someone who received help may have to be turned over to a collection agency and for some counselors this goes against the helping process,'she says.

Therapist, promote thyself!

According to Chadwick, a practitioner in the psychotherapy field for 20 years and creator of two different private practices, the biggest obstacle for therapists and the most important part of marketing is how the therapist views self-promotion.
Most therapists, she reveals, perceive marketing as a foreign entity that is something that they have to learn to do, and believe marketing has nothing to do with their current profession.

"Let's define marketing as any activity and attitude that furthers your business,'says Chadwick. "If you define marketing that way, obviously the most important place to start is the premise of what it means to market yourself.'

Chadwick advises therapists to learn to know and say out loud, without
arrogance or aggression, that the service they offer is good. "Successful marketing requires a fundamental attitude; a place inside of yourself where you know that you are really worth being known. It's an attitude of self-worth an attitude of confidence and abundance,'says Chadwick. "If you don't have that confidence it doesn't matter how many techniques you learn.'

Many therapists, get into therapy because of dysfunctional family backgrounds and a sensitivity to the importance of therapy. "It is hard for us to claim our value, so the marketing motivation has to be 'I know I'm good and I'm going to plant marketing seeds of what I have to offer in all different forms and everywhere I can. I'm going to tell everybody what I'm doing and how great I am and the perfect clients are going to come to me.''

The marketing strategies Chadwick suggests are the ones that cost the least, and are simple and useable in multiple situations, such as an ad in the Yellow Pages.

Here's how to do it:

• Adjust the cost to fit your budget
• Write a few lines of pertinent copy free of jargon in a small box to inform readers of evening and/or Saturday hours, and the mode of the counseling: individual, couples, families, groups.
• Clients seeking a therapist are usually in distress. Offer a free phone consultation.
  Highlight your name in red.
• A business ad beginning with the letter "A'is one of the first they will see a letter toward the end of the alphabet is one of the last. Aim for one or the other placement.

A business name instead of your own name gives the reader information about the nature of the business. (Chadwick's business name is LifeWorks, a tag that offers a philosophy and hope.)

Plant seeds

• Volunteer time to conduct a free support group one night a month.
• Market the things you love to do.
• Use 1,000 business cards every six months. Pass to: grocery store clerks (ask them to pass them on), taxi drivers, servers, store bulletin boards.
• Use photo flyers.
• Use note cards with your business name. At every opportunity send handwritten notes of appreciation to everybody.
• Join your Chamber of Commerce and become known.
• Create a Web site on the Internet and link it to other sources.
• Give the first counseling session for free unless the client decides to continue, at which point the first hour becomes billable.
• Offer some community workshops and seminars for free.

Write magazine articles, a newspaper column or a book.

Software:

Many therapists choose computer software to control their paperwork. Lots of helpful programs abound with various applications. Take a look: The Paper Office, by Edward L. Zuckerman, Guilford Press, $55. Clinical Documen-tation Sourcebook, by Donald E, Wiger, John Wiley Sons, Inc., provides sample forms for every stage of the treatment process in book form and on computer disk. It is one in a series of about 20 Practice Planners with topics related to mental health. A total office management solution for groups and solo practices is Therapist Helper, available through www.TherapyShop.com.

Bluewater Management Systems, features Bluewater Management Counseling and addiction support environment. BMCASE has outcome assessment software that tracks existing patients and provides data in graphic form. Capabilities include the ability to develop and refine clinical treatment approaches or counseling strategies. The company provides management consulting and software solutions in all areas of industry and healthcare. More information may be obtained at www.surf.-to/blueh2ms.

Klein advises therapists to consider the following three points when shopping for software:

1. Don't buy the cheap ones.

2. Find time-tested programs.

3. Find a program capable of processing electronic claims.

Software can help therapists keep track of money that they cannot keep track of in their head, and manipulate data more easily than if it were on paper and in files. This is particularly helpful when organizing managed-care records, which can get complicated, when assessing how many sessions have been approved, how many have accrued, and the amount of fees to collect.

Horror stories abound about clinicians who continue to see patients beyond their session allotment. "That's a decision you can make on your own,'says Klein, "if you want to do some pro bono work or you want to discount your fees for those patients who need it.'
However, Klein explains, "if the company has approved six sessions, and the therapist has seen the client 12, the therapist will not be paid. To make matters worse, there are no hard and fast rules to memorize the number of sessions each company provides for.'
Therapists have to know what their companies specify and it may vary even within a company. Keeping track of the variables is imperative to being organized and running a smooth business.

"I've spoken to clinicians who literally went out of business, because even though they were busy all day, they weren't keeping track of their own money. They were working for free and they didn't even know it,'says Klein. "They had to work for somebody else, because they didn't want to take on the tasks; they didn't want to be a business person. Clinicians, if they are going to stay in private practice, even if it takes a few hours a day, have to be businesspeople, not just therapists.'


Jan Marie Werblin is associate editor
of Professional Counselor magazine.

One person has commented on this article.

 1. Untitled
Troy Peverall, Unregistered

thanks for reiterating much of what I have spent my time doing over the last 5 years. the info is both affirming and again challenging to continue.

 Posted 2008-01-22 20:16:28

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