How To Break Free From Insurance and Build a Thriving Private Practice
Have you ever dreamt of a therapy practice where you ditch the paperwork hassles, fight for fair reimbursement rates, and actually offer the treatment you believe in?
Let's be honest, most therapists have.
But then reality hits: How do you make a living without insurance? What about angry clients and a drop in income?
In my experience as a private practice coach, I often hear therapists talk about their struggles to make a sustainable income. Many hoped to escape the burnout they experienced in agency work, only to find themselves facing new challenges in private practice. The constant grind to meet insurance requirements, coupled with low reimbursement rates, often leads to a different kind of burnout.
These are all valid concerns. But here's the thing: countless therapists have made the leap to private practice and built thriving businesses. In fact, many in my Balanced Private Practice Community actually regret not going private pay from the start. They saved themselves a ton of time, money, and frustration.
Now, before we dive in, let's be clear: This isn't about being anti-insurance nor about pushing you into a corner. It's about exploring the "what ifs" and showing you a path that might just lead to a happier, more fulfilling practice.
Transitioning to private pay isn't a one-size-fits-all solution. It's crucial to weigh the pros and cons carefully.
Benefits of Private Pay
Imagine this: you set the pace, choose your clients, and focus on what matters most – making a real difference in people's lives. Here are some of the key benefits of transitioning to private pay:
Freedom and Flexibility: Design your practice around your life, not insurance company rules.
Focus on Quality Care: Spend less time on paperwork and more time helping your clients.
Financial Security: Set your own fees and build a sustainable income.
Greater Client Satisfaction: Offer a wider range of services and cater to your ideal clientele.
Of Course, There Are Challenges Too. Here are some realities to consider:
Building a Client Base: You'll need to develop marketing strategies to attract new clients who are the perfect fit for your practice.
Financial Investment: There may be upfront costs for marketing and business tools.
Saying Goodbye to Some Clients: Not everyone will be able to afford private pay therapy. Be prepared to have open conversations with your current clients.
Unfamiliarity: Navigating the business side of things can feel like new territory.
While I never took insurance myself, I've coached countless therapists through the transition from insurance panels to private pay. Here's what I've learned and what I recommend.
Self-Reflection Questions
Before making the leap, ask yourself these crucial questions:
How will leaving insurance affect my current and prospective clients?
What do I need financially to sustain my practice and myself?
Why am I considering private pay?
What is the potential impact on my practice if I leave insurance?
How will I communicate this change to current and prospective clients?
Plan and Timeline
The first step in this transition is to have a clear plan and timeline. This is where the "freedom number" comes in. It tells you how many clients you need to see at your desired rate to live comfortably. Knowing this figure will help you make data-driven decisions and give you the confidence to book full-fee clients. I talked more about this topic here.
Define your Niche
Think of your ideal client. Who do you enjoy helping the most? What problems do you excel at solving? Niching down attracts the perfect clients for you, allowing you to refine your message and become an expert in your field. Don't worry, it doesn't mean turning away everyone else. It simply allows you to attract the clients who value your specific expertise.
Start Building Your Brand
Develop a website (consider a one-page website!) and social media presence to showcase your expertise and connect with potential clients. Start posting psychoeducational content and growing your audience well before your practice officially opens. Building an online presence takes time, so starting early gives you a head start.
Embrace the Power of Networking
Start talking about your plans to open a private practice to everyone you know. Share your plans with doctors, dentists, and other mentors. Network with other therapists and begin building your referral network. By the time your practice is ready to launch, you'll have a network in place to support you.
Communicate Openly with Existing Clients
Be upfront and transparent with your current clients. Explain your reasons for going private pay and emphasize the benefits for them. For loyal clients, consider offering a special "thank you" rate for a limited time. For those who can't continue, provide referrals to other therapists who take insurance. With clear communication and a little empathy, you can part ways with clients on good terms.
Inform Clients About Out-of-Network Benefits
Ensure all your clients are informed about their Out-of-Network (OON) benefits. Some clients may have these benefits and not be aware of them. This information can open the door for them to continue therapy with you, even after you leave insurance panels.
Gradual Transition
There's no need to jump ship all at once. You can gradually phase out insurance panels while building your private pay model. This allows you to build your confidence and financial security without feeling overwhelmed. Focus on building trust and value with your clients. Those who appreciate your work will respect your pricing.
Overcoming Fears and Imposter Syndrome
Transitioning to private pay can be liberating, but it takes a lot of planning and a little hand-holding (which is where I come in!). As a private practice therapist, I understand the overwhelm of starting your own business. The frustration of feeling overworked yet underpaid, the fear of raising fees or leaving insurance, the struggle to find your niche, and the imposter syndrome questioning your worth.
Consider enrolling in a course that will give you a step-by-step guide to transitioning away from insurance or personalized coaching to help you navigate the business aspects of therapy.
If you’re ready to take this step and need guidance, I’m here to help. Together, we can create a plan tailored to your unique practice needs and goals, ensuring a successful transition to private pay therapy. Remember, you don’t have to recreate the systems you were trained in – you can create something even better. Are you ready?
Apply to Work with Me.
Learn More About Me and My Courses.
Create a practice that aligns with your values and fuels your professional fulfillment.
About the Author
Meet Audrey Schoen, LMFT, business consultant, and entrepreneur. She supports solo private practice owners in finding a sustainable income while navigating the complexities of accepting insurance. With firsthand experience as a successful private practice owner and a parent of twins, Audrey understands the challenges of balancing work, parenthood, and self-care. By simplifying complex information into actionable steps, she empowers practitioners to launch their practices confidently, avoid costly mistakes, and achieve their dreams. Audrey's passion lies in helping private practice owners create a practice that aligns with their lives while offering invaluable knowledge and guidance to build thriving and fulfilling practices.
