Grow Your Practice by Billing 'Out-of-Network'
By Deb Legge, PhD, CRC, LMHC
Many counselors are not on all insurance panels. The reasons vary.
Some counselors prefer to run private-pay private practices. Some insurance companies don’t empanel counselors. Other insurance company panels are closed to new providers in certain areas of the country.
But just because you are not on a particular panel does not mean you have to pass on treating clients covered by that insurer. No matter why you don’t take your potential client’s insurance, you may have a viable option that might help both of you be able to work together.
Many insurance companies write contracts that include an “out-of-network” benefit for their customers; this benefit allows people to see providers who are not on the insurance company’s panel, but who are eligible to provide the services.
The next time you get a call from a new client asking if you take an insurance for which you are not a provider, you might want to let them know that you are happy to find out their out-of-network benefit and let them know how that might work in your practice. Your offer to help with this process is often a relief to the client—who really wants to see you, but who doesn’t want to deal with his or her insurance company.
All you will need from these potential clients is their full name, date of birth, insurance identification number, and the phone number (on the back of their card) of their insurance company. You can then call the insurance company and choose the option for “benefits and eligibility.”
When the representative comes on the line, let him or her know that you have been contacted by one of their customers who has asked you to find out their “out-of-network coverage for outpatient mental health services.” The rep will ask for the client’s information and will also want your NPI and/or tax ID number. With all of that information, the rep can look up the benefit.
On rare occasion, a client will have no out-of-network benefit (although this is more common with Medicare supplements and managed Medicaid). In that case, you can let your client know that his or her policy does not allow for out-of-network providers, and you can negotiate a private fee or refer them on.
More the norm, you will be given the deductible and co-insurance associated with that person’s out-of-network benefit. For example, you may be told that the client has a $250 out-of-network deductible and, once that is met, they have a 25 percent co-insurance. The insurance rep can also tell you if the deductible has been met for the year, and whether the policy is a calendar policy (Jan. 1 – Dec. 31) or if it starts at another time during the year.
This is important to you because deductibles will come back around each year. During this call, you can also find out if pre-authorizations are required, if there are session limits, and to which address you should send the claims.
The co-insurance can be a bit trickier until you learn the r
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ules of your local insurance carriers. For example, some insurance companies will not reimburse you directly (they will only send checks to the clients). In that case, you’ll want to collect in full at each session and your clients will be reimbursed according to their benefit.
If, however, the insurance company will reimburse you as the provider, you can collect in full for the sessions that will count toward the deductible. After that, you can collect just the co-insurance (in our example, that would be 25 percent).
If you are the one receiving the insurance checks, you will also get an EOB (explanation of benefits), telling you how, what, and why they are paying (or not).
Just to cover yourself, be sure your agreement with your clients spells out your policy that they are responsible for any payments not made by insurance.
This process may seem confusing, but once you do it a few times you’ll get the hang
of it, and it will open more doors for you when building your practice.
AMHCA Private Practice Library
Getting the information and support you need on the business of private practice can help you to build a successful and sustainable business. AMHCA members are invited to log-in to AMHCA’s Private Practice Library at to read articles by Dr. Deb Legge—for members only—on the business of running a clinical mental health counseling practice:
- “Finding a Home for Your Private Practice" (May)
- “Setting Your Fees”(April)
- “Getting on Insurance Panels” (March)
- “Finding Your Niche” (February)
- "Is Private Practice Really for You?” (January)