On Tuesday, I talked with you about how to terminate contracts with managed care companies.
That’s just one of several reasons that you may need to change your fees or reimbursement policies in private practice.
During the last month, I’ve been having a really interesting discussion via email with a psychologist in South Carolina who is trying to decide whether or not to continue working as an in-network provider with managed care.
One of her concerns is about how to let clients know once she decides to make that transition . . . .
. . . after reading your blog I just realized that it takes a weeks worth of insurance clients to pay my overhead AND I spend the time at night filing the insurance.
I am considering letting people know now [that I am going to resign from managed care panels] but making my termination date in 6 months to give more time for patients to transfer to another therapist or reach and end point.
How did you go about making the change?
Thanks so much”
Not So Fast
Assuming that you have signed a contract as a preferred provider with a managed care company, you cannot simply quit accepting clients from them on the day you decide that you no longer want to work directly with managed care.
Nor can you start charging those managed care clients your full fee without legally taking the proper steps.
Every managed care company for which you are a provider had you sign a contract in order to be on their preferred provider list.
Each contract stipulates the manner in which you must resign.
Virtually all companies require written notice of your intent to resign.
Some may require you to complete the work that you have begun with current clients at your contracted rate.
Others will specify the length of notice that you must provide to the managed care company and your clients that you are working with.
Bottom line – read and comply with each contract.
They are legally binding.
Beyond the legal stuff, what is most important for you to remember when making any change in your fiscal policies is respect – respect for your needs as an individual clinician and also respect for your clients’ needs.
Heads Up
With that in mind, I encourage you to give your clients as much notice as is reasonably possible when it comes to changing policies related to fees.
Once I have made that decision, I typically tell my clients at the end of the next session that “I expect that my fees will be changing in the next few months.
When you come back, I would like to talk about this with you so that you are not caught by surprise.”
Talk About The Change
At our next appointment, I begin the session by talking about whatever those changes in fees are.
That allows me to explain why and how my policy on fees or reimbursement is changing i.e. “I will no longer be a preferred provider for United Behavioral Health” or “I’ve now completed my certification in EMDR.”
This also allows ample time for my client to bring up his / her concerns related to this change.
Put It in Writing
I also advise my client that s/he will receive a follow up letter from me outlining the policy changes so that s/he will have the information in writing.
( I usually send this letter immediately after we have had this initial discussion about the change.)
I also reassure my client in this session (and the letter) that my services will continue to be available to him / her after this new policy goes into effect.
I stress that the only thing changing is my fees or methods of payment and that, as in the past, I will continue to work with him / her and remain available to answer questions or problem solve related to this and all other issues.
Check In
About one month before the new policy takes effect, I remind my client of the impending policy change and ask if there are any concerns or need for me to do anything to assist in making this a smooth transition.
It is possible that a client may need help with budgeting to continue working with you.
It is also possible that a client may want to wrap up treatment prior to the new policy taking effect.
It is also possible that you may need to refer a client to another colleague as a result of this transition.
Or, you may need to be creative in finding other ways to support your client based on his / her unique needs.
Timing Matters
I typically give my clients two to three months notice prior to making these changes.
The psychologist noted above is considering giving her clients six months notice.
For most clients, I think that may be excessive.
Both your circumstances and those of your clients may change significantly in six months.
Your clients may not even remember your discussions five or six months down the road.
Likewise, you don’t want to burden your client unnecessarily.
However, there may very well be extenuating circumstances that would support such a lengthy notice.
If your practice is psychoanalytically based and you typically see clients for years at a time, perhaps your clients are planning that far out.
Or, if your practice is focused on working with clients who struggle with unstable interpersonal relationships and tend to personalize easily, you may indeed need a longer period of preparation with your clients before actually implementing these changes.
Never Lost a Client
I have never lost one client due to an increase in my fees; however, I have had to get creative in meeting client needs.
I have never lost a client due to ending contracts with managed care; nor have I struggled to fill my appointment book after terminating those contracts.
And, I’ve never lost a client due to changing my policies related to reimbursement for my fees; in fact, I’ve had clients respond by saying “You should have raised them a long time ago.”
Here’s The Reason Why . . .
Now, I will admit that I do have exceptional clients.
They are, in fact, my favorite clients.
But, that’s simply because that’s who I market my practice to – my favorite clients.
And, the results that I get are directly related to our relationship with each other.
These are the same building blocks that I write about in this blog and that I consult with clinicians about every day.
When you build your practice on respect and relationships, your foundation for building a strong and vibrant private practice is virtually unshakable.
Great information Tamara! I was toying with the idea of increasing my fees (not related to managed care though) for clients that are self-pay once I complete my Doctorate. Now I know how to approach the transition! Thank you
So happy to help, Carla! And, also eager to hear if others go about this in a different way, too. Remember, there’s always more than one right way!
How is that Doctorate coming? I keep meaning to ask! What’s the degree in? Where are you in school? And, what do you plan to do with it?
I raised my fees when I relocated to a new office a couple of years ago. I started telling clients about the move and the fee increase about three months prior to the actual move. At their last session at the old office I gave each client the fee increases in writing and had them sign it to verify that they were notified and were aware of the increase. I kept a copy in their file and gave them a copy for reference. It was not an issue with any of my clients.
Hi, Pam! I’m so glad you dropped in to share your experience because, of course, getting that signature that they were notified about your fee increase is part of informed consent! I completely forgot to address this. And, obviously, you were right to keep a copy in your file, too. Like you, I’ve never had an issue with clients begrudging a fee increase.
Thanks for dropping in to chat!
Hi Tamara!
Do you recommend a similar approach for phasing out sliding scale?
Hi, Shemiah! Thanks for showing up here to chat!
Yes, I do recommend the exact same approach – being respectful and considering that clients need to plan their expenses and income just like we do.
Thank you so much for the information Tamara! Now I know how to approach this transition!
Awesome!