The Ugly Truth About Accepting Insurance In Private Practice (1/2)

Today is the first of our two-part blog series on way the pros and cons of insurance and private pay in private practice. With the focus on Insurance today. 

Are you feeling the stress about whether or not to take insurance or just do private pay?

Do you feel like you just don’t really understand either process enough to make an educated decision?

This is the first of our two-part blog series covering the pros and cons of taking insurance or doing private pay.

Deciding if you want to take insurance or not can be extremely daunting for many therapists. 

Insurance gets a bad wrap from a lot of mental health professionals in private practice.

It may not be for everyone, but it’s your choice to make.  

In this series, we are going to give you all the pros and cons of private pay and insurance so that you can confidently decide which is going to work best for you.

First, you should dig into what you are expecting out of your private practice and what you enjoy most.

If you don’t mind having a fully booked appointment calendar, consider taking insurance.

Taking insurance is going to do a lot of marketing for you so that you can solely focus on your clients and not how you are going to find them. 

Let’s dig into the pros of taking insurance in private practice.

insurance private practice

First, your private practice will fill up… fast!

Most clients who have insurance do one thing when they decide they need to seek therapy. They call up their insurance to see who is in their network.

When you are accepted on their network, you show up on these panels. Showing up on these panels gives you a steady stream of clients fast, usually completely booking your private practice within the first couple of months.


This also goes hand in hand with the second pro which is you don’t have to market.

When the insurance company is filling your practice up for you, you don’t have to put any effort or money into trying to find clients on your own.

The in-network referrals from the insurance companies do all the work for you.

Third, if you aren’t having to find any clients you can skip the process of creating your brand.

Your brand is how you present yourself to prospective clients. If you are booked without any effort, then you can skip this step.

Next, you can have more frequent sessions with your clients because of their insurance for your private practice.

When you are seeing a client who is using their insurance they are just paying a small copay and the insurance is paying for the rest.

Since they aren’t reaching into their pockets as much as private pay clients, they are more likely to see you weekly.

When you can get that frequency with the client, they are likely to achieve their goals at a much quicker pace, giving you and them a huge feeling of accomplishment.

This will likely start to give you a stream of referrals since they are so stratified with the healing you helped them achieve.

Economic recessions?

Not for you! With insurance, if the market tanks and everyone is holding onto their cash, you won’t be near as affected since insurance will be paying for most of the bill.

Finding Your Niche In Private Practice

This is also great for people who strongly are against the idea of niching down.

When you choose to accept insurance, you’ll get a broad range of clients so you get to see a little bit of everyone.

Number seven… you are helping people who would not normally be able to afford therapy because they can when you take insurance in private practice.

This is a huge moral motivation for a lot of therapists, and we see it as a major pro. Just because someone cannot afford out of pocket therapy doesn’t mean they shouldn’t have access to it. Accepting insurance helps reach out to all that may need help.

The final pro is, accepting insurance gives the practice some credibility in that the insurance company has credentialed you.

Now that we have highlighted all the reasons you should take insurance, lets cover why it has such a bad wrap.

insurance private practice pay

To start with, insurance can take a REALLY long time to pay you.

I’m talking about 6 weeks at the minimum and MONTHS at the latest. When you’re first starting out, waiting that long to receive payment could be detrimental.

Next, you have no control over basically every aspect of how you practice.

Insurance companies will tell you who you are going to see, and unless you have some major reason why you just aren’t fit for this client, you have to take whomever they send your way.

On top of them telling you who, they also restrict how.

They can tell you which methods you can and cannot use, along with how long and where you can see them.

This can get really frustrating when you are trying to help someone, but you have a list of rules on how you can do it.

Our third con is a big one… you’re going to make less money in exchange for your time.

You may have a set rate for what you charge clients who pay out of pocket, but guess what… insurance does not follow that at all.

They use your zip code and your qualifications to determine who much they should say you make. Then once they have that rate, they only pay you a portion of that. Normally around 60-80 percent.

When you are making so much less per client, you will have to see more clients to make your needed salary.

When you push yourself by seeing so many clients, you’re risking possible burnout.

If you are unfamiliar with burnout we have linked our blog about that right here.

If you find that frustrating, wait until you hear the next con.

Since you are taking insurance they dictate when you get paid.

They also have the right to deny your claim. In order for you to dispute this denial, you have to call them.

You will be spending a lot of your time on the phone with the insurance company trying to get paid for the work you are doing.

They often have a high rate of denial, and even the smallest mistakes can get your claim denied.

When a client’s insurance denies a claim, guess who gets stuck with that bill?

The client.

This often causes a disruption in the therapy process,

which is our next con. They can take up to two months to tell you that they have denied a claim.

When this happens it creates a huge bill.

This huge bill can be a major surprise to the client and they may not have the funds to cover it. This causes them to pause their current services with you and maybe even cause them to never resume.

Number 6 is stigmatization.

In order for insurance to pay you for that client, they have to have a diagnosis from you for them to see why the therapy is needed for this client.

This permanently marks this person with this diagnosis on their record.


When you are seeing clients with insurance you tend to get a larger group of them who are not motivated.

Since they aren’t paying as much of their own hard-earned cash they tend to take your healing less seriously causing you more frustration when trying to help them.

Lastly, accepting insurance ultimately requires having to have other software and systems in place.

You will need to learn how to handle billing properly along with making sure you have the correct software to do so.

That is our list of pros and cons for accepting insurance in private practice.

Keep in mind that not all insurances pay the same rate, so the pay cut you are taking, if you do decide to accept insurance, can span a wide range from one company to the next.

If you decide that accepting insurance is right for you, help yourself by getting specialized training for that.

There is no class in college that teaches you how to bill insurance correctly and as we have stated earlier, insurance companies can deny you for even the smallest mistakes.

So take some time and invest in your knowledge of how to bill correctly so you aren’t costing yourself money in the long run.

We found a fabulous course by Mastering Insurance, LLC we have it linked right here for you. 

You can always look into paying someone to take care of your billing. This is a way to ensure that you are getting paid for what you are doing and takes a large amount of stress off of your shoulders.

Leave us comments on how much this blog helped you make the call on whether you should accept insurance or not. 

Pin It on Pinterest

Share This