fee splitting

[PSYD2024]

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Early Career Psych here...is a 60/40 split a good option working in private practice? 60 would go to me and 40 to the practice. Anywhere from $200-260/session.

 

[Sanman]

I would call 60/40 is average. 70/30 would generally be good and 50/50 or below bad. The question here will be how busy can they keep you, how restrictive is the non-compete, and are there any benefits other than split (cover Mal practice Insurance? CEUs?)

 

[AcronymAllergy]

I would call 60/40 is average. 70/30 would generally be good and 50/50 or below bad. The question here will be how busy can they keep you, how restrictive is the non-compete, and are there any benefits other than split (cover Mal practice Insurance? CEUs?)

Agreed, 60/40 is pretty typical from what I've seen, but a lot of it depends on what support and benefits they're providing.

 

[WisNeuro]

Just a quick point of clarification, "fee splitting" is a distinct term legally. Pretty much when someone refers a patient and receives compensation due to that referral. Different than one's percentage of revenue for management.

 

[PsyDr]

Fee splitting is also a felony.

 

[Therapist4Chnge]

Definitely don’t call it fee splitting bc that’s an easy way to crime, and even easier to prove when you write it down in an email and/or contract.

 

[Doctor Eliza]

Is this a cash practice or insurance?

 

[GT_Neuro]

I am a practice owner. The rates you quoted must be private pay. Insurances don't pay in those ranges. One question to ask is whether or not the practice can keep your schedule full (e.g., 30 patients / week) at those rates.

Another question to ask if joining a practice is what do you get for your split, and can they deliver (talk to other Psychologists in the practice before you join)? For example:

#patients they can provide
Admin support (this is huge); # staff in office working, scheduling, checking insurance benefits/authorization, etc.
Psychometricians (if you are doing testing)
Cost of psych/neuropsych tests, protocols, scoring, etc.
What is the space they are providing?
Is billing included (usually it is, and it should be).
Do they cover the cost of credit card payments or is this taken off the top?
Are they covering costs of your WC, Psychologist Lic fee, Liability insurance, business license, CEU?
Do they provide health insurance?
Are they providing you with a computer, electronic medical record, office phone/fax/internet, all office supplies? They should be doing this.

There are other potential costs as well.

That being said, I would close down my practice today if someone could guarantee me full-time work at those rates. You would be easily making $200,000+ / year, and all you have to do is see patients - no admin demands. I could be wrong but I think it would be difficult to guarantee this in most parts of the country.

Best moving forward in your career!

 

[PSYD2024]

I am a practice owner. The rates you quoted must be private pay. Insurances don't pay in those ranges. One question to ask is whether or not the practice can keep your schedule full (e.g., 30 patients / week) at those rates.

Another question to ask if joining a practice is what do you get for your split, and can they deliver (talk to other Psychologists in the practice before you join)? For example:

#patients they can provide
Admin support (this is huge); # staff in office working, scheduling, checking insurance benefits/authorization, etc.
Psychometricians (if you are doing testing)
Cost of psych/neuropsych tests, protocols, scoring, etc.
What is the space they are providing?
Is billing included (usually it is, and it should be).
Do they cover the cost of credit card payments or is this taken off the top?
Are they covering costs of your WC, Psychologist Lic fee, Liability insurance, business license, CEU?
Do they provide health insurance?
Are they providing you with a computer, electronic medical record, office phone/fax/internet, all office supplies? They should be doing this.

There are other potential costs as well.

That being said, I would close down my practice today if someone could guarantee me full-time work at those rates. You would be easily making $200,000+ / year, and all you have to do is see patients - no admin demands. I could be wrong but I think it would be difficult to guarantee this in most parts of the country.

Best moving forward in your career!

Hi,
thank you this is very helpful. im early career psych so still trying to learn whats best and not being scammed. I'd be carrying over some clients from my previous place and they claim to provide some as well as offer marketing like psych today. they cover admin stuff/billing/ scheduling. no testing. health insurance included and office space/supplies. What is WC?

 

[PSYD2024]

Definitely don’t call it fee splitting bc that’s an easy way to crime, and even easier to prove when you write it down in an email and/or contract.

my apologies. what is it called then?

 

[Therapist4Chnge]

my apologies. what is it called then?

Compensation package? It's mostly that "fee splitting" is a legal term, and it most commonly comes up in healthcare related to how medical charges are paid and then distributed....though it can look a lot like a kickback if not written up correctly. A lot of it is about how Medicare and other gov't paid healthcare pays and how they want to avoid medical practices that enrich themselves via kickbacks. Instead of re-inventing the wheel, here is a quick summary from the AMA & Psychiatric Assoc: https://www.psychiatry.org/File Library/Psychiatrists/Practice/Practice-Management/Practice-Management-Guides/PrivatePractice-Fee-Splitting.pdf

 

[Doctor Eliza]

From your other thread it seems you are not fully licensed yet, correct? I'm guessing it is a cash practice given the numbers you quoted above. With those two factors being the case, I would be worried about the practice's ability to keep you full. If people are paying cash they tend to be really picky because why see someone for $200 when you could see someone for your $25 copay? It helps if you have a very specific skill set that is hard to find elsewhere. Otherwise, it is likely that a typical cash pay patient would want to see someone with more experience. Not trying to be a downer but encouraging you to beware of potential pitfalls.

 

[AcronymAllergy]

my apologies. what is it called then?

I might call it something like revenue split, billing split, or reimbursement split (or just "split"). If you reference 70/30, 60/40, or something similar with respect to a practice, people will generally know what you're talking about.

 

[PsyDr]

I am a practice owner. The rates you quoted must be private pay. Insurances don't pay in those ranges. One question to ask is whether or not the practice can keep your schedule full (e.g., 30 patients / week) at those rates.

Another question to ask if joining a practice is what do you get for your split, and can they deliver (talk to other Psychologists in the practice before you join)? For example:

#patients they can provide
Admin support (this is huge); # staff in office working, scheduling, checking insurance benefits/authorization, etc.
Psychometricians (if you are doing testing)
Cost of psych/neuropsych tests, protocols, scoring, etc.
What is the space they are providing?
Is billing included (usually it is, and it should be).
Do they cover the cost of credit card payments or is this taken off the top?
Are they covering costs of your WC, Psychologist Lic fee, Liability insurance, business license, CEU?
Do they provide health insurance?
Are they providing you with a computer, electronic medical record, office phone/fax/internet, all office supplies? They should be doing this.

There are other potential costs as well.

That being said, I would close down my practice today if someone could guarantee me full-time work at those rates. You would be easily making $200,000+ / year, and all you have to do is see patients - no admin demands. I could be wrong but I think it would be difficult to guarantee this in most parts of the country.

Best moving forward in your career!

Youngsters, let me give you some insight into this.

1) # of patients provided= this is arguably the best value an employer brings.
2) Admin staff= this is largely BS. The employer's administrative staff do not linearly increase by the number of employees. One administrative person can handle 1, 2, 3, 4, or even 5 psychologists.
3) Psychometricians= this is a fair factor to bring up. But employers are AT LEAST breaking even on the revenue the psychometricians bring in. It is more likely that the employer is making a small amount of money on the psychometricians.
4) Cost of protocols and tests are a nonsense expense. Protocols are $30 per evaluation. Tests-the employer gets to depreciate the tests on their taxes.
5) Billing is a fair thing to bring up. Most places are either billing for themselves using admin staff, or are paying ~10-15% of receiveables.
6) CREDIT CARD PROCESSING? Kiddos, that starts around 1-3%.
7) Business expenses are a consideration, but they are a tax write off that affects gross not net. WC- nonsense expense per month, similar to getting coffee. Licensing fee, divided by 12 is nonsense per month. The most expensive liability insurance policy you can get starting out is $250/month. CEUs are a business expense, and can be written off.
8) Health insurance- can be a substantial consideration (e.g., $1k/month per employee).

 

[WisNeuro]

Youngsters, let me give you some insight into this.

1) # of patients provided= this is arguably the best value an employer brings.
2) Admin staff= this is largely BS. The employer's administrative staff do not linearly increase by the number of employees. One administrative person can handle 1, 2, 3, 4, or even 5 psychologists.
3) Psychometricians= this is a fair factor to bring up. But employers are AT LEAST breaking even on the revenue the psychometricians bring in. It is more likely that the employer is making a small amount of money on the psychometricians.
4) Cost of protocols and tests are a nonsense expense. Protocols are $30 per evaluation. Tests-the employer gets to depreciate the tests on their taxes.
5) Billing is a fair thing to bring up. Most places are either billing for themselves using admin staff, or are paying ~10-15% of receiveables.
6) CREDIT CARD PROCESSING? Kiddos, that starts around 1-3%.
7) Business expenses are a consideration, but they are a tax write off that affects gross not net. WC- nonsense expense per month, similar to getting coffee. Licensing fee, divided by 12 is nonsense per month. The most expensive liability insurance policy you can get starting out is $250/month. CEUs are a business expense, and can be written off.
8) Health insurance- can be a substantial consideration (e.g., $1k/month per employee).

For #2, I'd say breaking even if benefits are on board. Per PFS, it's $34.25 per unit of 138/139, so $68.50/hour when they are testing/scoring. But, I'd assume they're also doing some admin work that is not billable during the day. So, I'd agree that they are likely bringing in a small profit, but probably pretty small (if they receive benefits). Their biggest contribution is freeing up testing time so the neuropsych can do higher paid work as 136 reimburses $40 per PFS.