Ways You Leave Money on the Table: A Comprehensive Guide for Therapists
Operating a successful private practice involves more than providing exceptional care to clients; it also requires managing the financial health of your business. Unfortunately, many therapists unknowingly leave money on the table, often due to overlooked processes in their insurance billing practices.
This guide explores three common ways revenue is lost in private practice—failure to verify eligibility and benefits, neglect to collect client payments, and not appealing denials. Each issue is accompanied by practical solutions to help you maximize your practice’s revenue and sustain its financial success.
Ways You May be Leaving Money on the Table (without realizing!)
Not Verifying Eligibility and Benefits
Verifying Eligibility and Benefits gives you a clear picture of whether or not the patient will be covered by insurance for services, any special circumstances for their insurance coverage and what payment responsibility the patient has, if any. Therapists often focus on building rapport and establishing trust when welcoming a new client. While these steps are vital, overlooking the verification of insurance eligibility and benefits can lead to significant financial challenges later.
Insurance plans can be complex, with carve-outs for mental health services, out-of-network clauses, or session limits that are not immediately apparent. Submitting claims without verifying these details risks denial or underpayment, leaving you with unexpected out-of-pocket expenses or unpaid services.
Pitfalls of not verifying eligibility and benefits:
Carve-Outs: Some insurance plans delegate mental health benefits to separate carriers, creating confusion if claims are sent to the wrong payer.
Session Limits or Authorization Requirements: These details must be included in claims being denied after the service has already been provided.
Deductibles and Copays: Failing to clarify a client’s financial responsibility can complicate payment collection.
Solution: Implement a Verification Process
Establishing a robust process for verifying benefits before the first session can prevent these issues:
Train Staff or Outsource Verification: Ensure your team understands how to navigate insurance portals or get a Practice Solutions biller on your team- we’ll manage eligibility and benefits for you.
Check for Specifics: Verify whether mental health services are covered, note session limits, determine if pre-authorization is required, and confirm deductible and copay amounts.
Communicate with Clients: To avoid surprises, share a clear summary of their benefits and financial obligations.
Investing time in thorough verification can save your practice significant revenue and reduce the risk of claims rejection. Need help ensuring that the processes you establish are successful? Learn more about Professional Services from Practice Solutions.
Not Collecting Payments from Clients
Therapists often face challenges when discussing money with their clients. Many practitioners delay or avoid collecting payments, particularly copays and coinsurance, to avoid disrupting the therapeutic relationship. Unfortunately, this practice can have long-term financial consequences.
When payments are collected at a later time of service, they are more likely to become overdue or written off entirely. This creates a financial strain on the practice and places an administrative burden on follow-up collections.
Common Pitfalls of not collecting payments from clients:
Client Misunderstandings: If financial expectations are not clearly communicated, clients may assume insurance covers the full cost of care.
Delayed Collections: Relying on post-session billing can lead to unpaid balances or disputes about charges.
Write-Offs: Unpaid balances are often written off as “bad debt,” eroding your practice’s profitability.
Solution: Establish Clear Payment Protocols
Proactive payment policies can help ensure timely collection of revenue:
Set Expectations Early: Include payment terms in your client intake paperwork and review them during the initial session.
Require Payment at the Time of Service: Use secure payment platforms to collect copays and coinsurance immediately.
Automate Payments: Offer options for automatic payment processing to reduce friction in ongoing sessions.
Positioning payment collection as part of the therapeutic investment helps clients understand its importance while reinforcing your practice's professionalism. If processes are your problem, Professional Services may be your solution. Or, our patient support services allow Practice Solutions to manage patient payments. Contact us to learn more!
Not Appealing Insurance Denials
Insurance denials are an unfortunate reality when working with third-party payers. However, many therapists fail to appeal these denials due to time constraints or a lack of familiarity with the appeals process.
According to a study by the Kaiser Family Foundation, only 1% of denied claims are appealed. This statistic highlights a significant opportunity for therapists to recover revenue that might otherwise be forfeited. Denials often result from errors or incomplete information, which can frequently be resolved with an appeal.
Common Pitfalls of not appealing insurance denials:
Missed Opportunities: Failing to review denial codes and reasons for rejection often results in lost revenue.
Recurring Issues: Without addressing the root causes of denials, practices may face repeated claim rejections.
Time Constraints: The appeals process can be time-consuming, leading some providers to deprioritize it.
Solution: Create an Appeals Strategy
By implementing a structured approach to managing denials, therapists can recover significant revenue:
Analyze Denials: Carefully review explanations of benefits (EOBs) or electronic remittance advice (ERA) to determine why claims were denied.
Act Quickly: Submit appeals within the insurance company’s specified time frame, providing all necessary documentation to support your case.
Track Patterns: Use denial data to identify trends and adjust processes to prevent similar issues in the future.
While the appeals process requires diligence, its potential to recover revenue makes it an essential practice for any therapist working with insurance. Practice Solutions billers are experienced in denial management and appeals, working to recover the money that your practice may be leaving on the table - and you may be leaving money on the table unintentionally!
Why Partnering with Practice Solutions Makes the Difference
While understanding these common billing challenges is a critical first step, solving them requires time, expertise, and attention to detail—resources many therapists simply don’t have to spare. Practice Solutions connects therapists with experienced professionals in insurance billing, ensuring that practices are maximizing their revenue through good billing processes.
We specialize in supporting therapists by handling the complexities of insurance billing, from verifying benefits to collecting payments and managing denials. By partnering with us, you gain access to:
Expert Knowledge: Our team stays up-to-date on the latest insurance trends and best practices.
Time Savings: Spend less time on administrative tasks and more time focusing on your clients.
Increased Revenue: Ensure you’re collecting every dollar you’re owed for the care you provide.
Final Thoughts
Therapists dedicate themselves to improving their clients’ well-being, but financial stability in private practice requires attention to detail in revenue management. Verifying eligibility, collecting payments, and appealing denials are critical components of a robust billing strategy that ensures you are compensated fairly for your work.
By implementing the solutions outlined in this guide, you can reduce financial stress, increase your revenue, and focus on what matters most—providing exceptional care to your clients. Take control of your practice’s economic health and stop leaving money on the table. Your work is valuable, and your revenue should reflect that.
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