New private practice - should I accept insurance?

[GynGuy1983]

Hi everyone,

I was hoping to get a better understanding on how to accept insurance in my private practice. I'm currently in a hospital employed position and have a small cash only private practice on the side (approximately 12 billable hours total). I am having some difficulty filling those 12 hours consistently and was on the fence about accepting insurance until more recently. I finally decided to do so after negotiating reasonable rates for most of the codes that we use (99205, 99213-99215, 90833-90839, etc).

I was hoping to get some feedback from other clinicians that are doing their own billing and what to expect in terms of getting reimbursed in a timely fashion, as well as any other barriers that have come up. Any help would be greatly appreciated.

Thanks in advance.

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[nexus73]

If you can network with local psychiatrists and find out which insurance companies pay the best and give the least hassle, then only sign with them.

 

[Merovinge]

If you can network with local psychiatrists and find out which insurance companies pay the best and give the least hassle, then only sign with them.

This. In my area there is clearly 1 insurance company PPO that is taken by "cash" psychiatrists as it pays consistently top of the line and they tend to not make many hoops for the providers. Interestingly this same company is reportedly awful to deal with in other areas so definitely check with people already doing it around you.

 

[Jules A]

Hi everyone,

I was hoping to get a better understanding on how to accept insurance in my private practice. I'm currently in a hospital employed position and have a small cash only private practice on the side (approximately 12 billable hours total). I am having some difficulty filling those 12 hours consistently and was on the fence about accepting insurance until more recently. I finally decided to do so after negotiating reasonable rates for most of the codes that we use (99205, 99213-99215, 90833-90839, etc).
.

Will you be sacrificing your cash patients to start accepting insurance? A cash practice Doc I'm friends with moonlights at a clinic but only takes medicaid there saying if his boutique practice patients found out he was accepting insurance elsewhere they would want to be seen there also.

 

[GynGuy1983]

Will you be sacrificing your cash patients to start accepting insurance? A cash practice Doc I'm friends with moonlights at a clinic but only takes medicaid there saying if his boutique practice patients found out he was accepting insurance elsewhere they would want to be seen there also.

Thanks to everyone that has replied so far.

I'm only currently paneled with one insurance company to see how things play out. For me, building a practice even with insurance would probably pay me substantially more than any employed position locally. There aren't many psychiatrists in the area that accept insurance, which brings up the question why I would. What I've come to realize is that I'd rather maintain a smaller caseload and see patients more frequently rather than have a ton of new evaluations and losing people due to their inability to pay for follow-ups. Also, despite the very affluent population in the area, they DO NOT want to pay out-of-pocket for treatment.

Any recommendations for billing aside from Navinet or OfficeAlly?

 

[TexasPhysician]

Are you C&A? If so, you should be able to build all cash in most areas. Are you marketing effectively? What is preventing your growth?

Few want to pay out of pocket vs insurance coverage, but the demand is there.

 

[GynGuy1983]

Are you C&A? If so, you should be able to build all cash in most areas. Are you marketing effectively? What is preventing your growth?

Few want to pay out of pocket vs insurance coverage, but the demand is there.

Yes, I'm a board certified C&A psychiatrist. The market is somewhat saturated in this area, but demand is there. The only issue is that while I could fill my practice with all cash patients, my estimates are that it would take approximately 18-24 months. I'm in the process of transitioning from F/T to P/T and need to generate as much stable income as possible.

Also, my cash rates are only $15 more compared to what this insurance panel is paying for a 99213+90833. If I can consistently generate $300-$400/hour, I would be very happy as long as overhead remains low. 30 hours/week at $300/hr is $9000 a week, $36k/month or approximately $360k annually if you factor in 8 weeks off for vacation, CME, etc.

Does anyone here accept insurance in their private practice?

 

[PistolPete]

Yes, I'm a board certified C&A psychiatrist. The market is somewhat saturated in this area, but demand is there. The only issue is that while I could fill my practice with all cash patients, my estimates are that it would take approximately 18-24 months. I'm in the process of transitioning from F/T to P/T and need to generate as much stable income as possible.

Also, my cash rates are only $15 more compared to what this insurance panel is paying for a 99213+90833. If I can consistently generate $300-$400/hour, I would be very happy as long as overhead remains low. 30 hours/week at $300/hr is $9000 a week, $36k/month or approximately $360k annually if you factor in 8 weeks off for vacation, CME, etc.

Does anyone here accept insurance in their private practice?

Just curious, what part of the country are you in? You don't have to give the specific city if you don't want to. Also, how have you attracted patients to your private practice?

 

[dl2dp2]

There are a couple of considerations. Once you get on the panel, it's hard to get off the panels, especially when your practice has achieved some kind of equilibrium. So if the alternative is to do locum for 18 months until you fill your practice, in the long run this might be better, since I suspect that your fee is on the low side if it's only $15 higher than insurance (i.e. I suspect you can raise fees.)

30 hours of solid insurance patients, especially C&A, is actually kind of a lot, and you might need a secretary. You will definitely need a biller. In the fully cash model, in about 2 years, you will have a 25-30 hour practice with a much lower case load with lower overhead...the escalation in income might be greater, though. There is no straightforward right answer. If you really want to be serious about it you can run a few models on Excel...

 

[TexasPhysician]

Yes, I'm a board certified C&A psychiatrist. The market is somewhat saturated in this area, but demand is there. The only issue is that while I could fill my practice with all cash patients, my estimates are that it would take approximately 18-24 months. I'm in the process of transitioning from F/T to P/T and need to generate as much stable income as possible.

Also, my cash rates are only $15 more compared to what this insurance panel is paying for a 99213+90833. If I can consistently generate $300-$400/hour, I would be very happy as long as overhead remains low. 30 hours/week at $300/hr is $9000 a week, $36k/month or approximately $360k annually if you factor in 8 weeks off for vacation, CME, etc.

Does anyone here accept insurance in their private practice?

I don't think I could run an insurance practice without adding at least 10% more in overhead. Billing is a major hassle, staff to verify benefits, more total patients calling, etc.

While insurance would reap short term benefits, it will substantially decrease long-term earnings.

 

[GynGuy1983]

There are a couple of considerations. Once you get on the panel, it's hard to get off the panels, especially when your practice has achieved some kind of equilibrium. So if the alternative is to do locum for 18 months until you fill your practice, in the long run this might be better, since I suspect that your fee is on the low side if it's only $15 higher than insurance (i.e. I suspect you can raise fees.)

30 hours of solid insurance patients, especially C&A, is actually kind of a lot, and you might need a secretary. You will definitely need a biller. In the fully cash model, in about 2 years, you will have a 25-30 hour practice with a much lower case load with lower overhead...the escalation in income might be greater, though. There is no straightforward right answer. If you really want to be serious about it you can run a few models on Excel...

I think this point it's more about financial independence and no longer being an employee.

I don't think I could run an insurance practice without adding at least 10% more in overhead. Billing is a major hassle, staff to verify benefits, more total patients calling, etc.

While insurance would reap short term benefits, it will substantially decrease long-term earnings.

My business plan is to have a mix of insurance and private pay patients, not just strictly insurance only. I've been in private practice now for about 6 months and while fee for service patients are the most desirable, their expectations are very high and they can be very demanding/entitled. Once their crisis has been resolved and they're more stable, the prospect of paying out of pocket seems to become a burden.

I wish there was more transparency in regards to billing amongst psychiatrists to help newer clinicians like myself establish themselves. Instead, we focus on salaried positions, call duties, etc, and marvel at the prospect of making $150/hr when you can easily make double that in your own practice accepting insurance.

My current PP fee schedule is as follows:
60 min new adult evaluation - $400
90 min new child evaluation - $600
30 min medication management - $200

I don't do 50 min therapy sessions, but integrate IPT and CBT principles as part of the 16 minutes of psychotherapy they are being billed for.

My overhead is very low given my current practice location and the quality of my building. I currently use an outsourced live receptionist service that does all my scheduling and gathers all of the patient demographics. At some point, I'll have patients upload their information via a patient portal that's integrated into my EHR to further streamline the process, as well as adding a PHQ-9 and GAD-7. As for billing, I don't know about everyone else here, but I will add that as part of my admin time or will outsource it depending on how busy I get.

Everyone likes to talk a good game, but until you're actually doing it, it's hard to factor in all of the complexities of running your own business. My office is located in an affluent town in NJ about 30-40 min from NYC. My primary referral stream has been through Psychology Today and word of mouth from patients, therapists in the community, and other physicians.

 

[PistolPete]

I think this point it's more about financial independence and no longer being an employee.


My business plan is to have a mix of insurance and private pay patients, not just strictly insurance only. I've been in private practice now for about 6 months and while fee for service patients are the most desirable, their expectations are very high and they can be very demanding/entitled. Once their crisis has been resolved and they're more stable, the prospect of paying out of pocket seems to become a burden.

I wish there was more transparency in regards to billing amongst psychiatrists to help newer clinicians like myself establish themselves. Instead, we focus on salaried positions, call duties, etc, and marvel at the prospect of making $150/hr when you can easily make double that in your own practice accepting insurance.

My current PP fee schedule is as follows:
60 min new adult evaluation - $400
90 min new child evaluation - $600
30 min medication management - $200

I don't do 50 min therapy sessions, but integrate IPT and CBT principles as part of the 16 minutes of psychotherapy they are being billed for.

My overhead is very low given my current practice location and the quality of my building. I currently use an outsourced live receptionist service that does all my scheduling and gathers all of the patient demographics. At some point, I'll have patients upload their information via a patient portal that's integrated into my EHR to further streamline the process, as well as adding a PHQ-9 and GAD-7. As for billing, I don't know about everyone else here, but I will add that as part of my admin time or will outsource it depending on how busy I get.

Everyone likes to talk a good game, but until you're actually doing it, it's hard to factor in all of the complexities of running your own business. My office is located in an affluent town in NJ about 30-40 min from NYC. My primary referral stream has been through Psychology Today and word of mouth from patients, therapists in the community, and other physicians.

You sound like you know what you're doing. I've heard that filling a cash-pay private practice for about 30-40 hours per week can take up to 2 years, so maybe just continue doing what you're doing and as you become more well-known in the area, you'll get more patients without having to resort to taking any insurance, unless you want to.

 

[F0nzie]

Let's say you take insurance and see a patient. Pt later finds out has a deductible of $5000 and gets a surprise bill from you $2000 for intake and all the follow ups. What % of the $2000 do you get?


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[dl2dp2]

Let's say you take insurance and see a patient. Pt later finds out has a deductible of $5000 and gets a surprise bill from you $2000 for intake and all the follow ups. What % of the $2000 do you get?


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If you "take insurance", it means that it would have a different, usually much lower deductible ("the in-network") deductible. The assumption is the patient would only have to pay co-pay.

 

[F0nzie]

If you "take insurance", it means that it would have a different, usually much lower deductible ("the in-network") deductible. The assumption is the patient would only have to pay co-pay.

I am not sure how health insurance is in NJ, but it's terrible where I live. Both in-network and out-of-network deductibles are high and on the rise. Consumers very much have the false assumption that all they need to pay for their doctors visits are their copays. Due to the lack of transparency, it can be predicted with certainty that those bills will be disputed or not paid. More admin will be required for reissuing invoices and tracking collections. A better question for the OP is what is his estimated collections % so that he can use that number to estimate is true salary. The best people to ask are those doing it in his area and according to the OP very few are-- this alone should be a red flag.


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[TexasPhysician]

My business plan is to have a mix of insurance and private pay patients, not just strictly insurance only. I've been in private practice now for about 6 months and while fee for service patients are the most desirable, their expectations are very high and they can be very demanding/entitled.

Interesting. I've found insurance patients to be more demanding which was part of the reason to transition to cash only. I much prefer cash only.

Do you do internet marketing beyond psychology today? I haven't found that to be particularly helpful.

 

[dl2dp2]

I am not sure how health insurance is in NJ, but it's terrible where I live. Both in-network and out-of-network deductibles are high and on the rise. Consumers very much have the false assumption that all they need to pay for their doctors visits are their copays. Due to the lack of transparency, it can be predicted with certainty that those bills will be disputed or not paid. More admin will be required for reissuing invoices and tracking collections. A better question for the OP is what is his estimated collections % so that he can use that number to estimate is true salary. The best people to ask are those doing it in his area and according to the OP very few are-- this alone should be a red flag.


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THAT's interesting. Recently I had a colleague who had a similar issue where supposedly in network deductible ends up being as high as out of network. The patients should supposedly use their HSAs in that case, but probably don't know any better and therefore didn't have one. I think you are 100% right. This is getting worse.

 

[TexasPhysician]

THAT's interesting. Recently I had a colleague who had a similar issue where supposedly in network deductible ends up being as high as out of network. The patients should supposedly use their HSAs in that case, but probably don't know any better and therefore didn't have one. I think you are 100% right. This is getting worse.

ACA was very poor at handling costs. I just got a bill for a visit that results in owing more than had I paid cash at an in-network provider. Insurance patients rightly so get quite irritated over this.

 

[PistolPete]

Interesting. I've found insurance patients to be more demanding which was part of the reason to transition to cash only. I much prefer cash only.

Do you do internet marketing beyond psychology today? I haven't found that to be particularly helpful.

That's interesting. At my AMC, I've found the Medicaid patients to be much more entitled than the patients with commercial insurance.

 

[TexasPhysician]

That's interesting. At my AMC, I've found the Medicaid patients to be much more entitled than the patients with commercial insurance.

Agreed, but most Medicaid patients are not paying cash only.

 

[GynGuy1983]

No one talks about actual rates and how much revenue they are generating. As a profession, we rarely talk about compensation, but complain that we are getting shafted by insurance companies. Meanwhile, we take these terrible jobs generating a ton of wealth for more administrators to micromanage everything. Just to put this out there, if you make $400/hr and work full time (37.5 hours) with 20 days PTO, that's around $800k. Meanwhile, an average hourly wage for psychiatry is $120/hr.

As for marketing, the best way to get your name out there is by doing great work. I have a website with SEO and I get a lot of phone calls, but the rate limiting step is who can afford to pay and who can't. You start to realize that a large majority of people, despite a six figure salary, are unable to float $600 a month for treatment as they await their insurance to reimburse them.

 

[GynGuy1983]

THAT's interesting. Recently I had a colleague who had a similar issue where supposedly in network deductible ends up being as high as out of network. The patients should supposedly use their HSAs in that case, but probably don't know any better and therefore didn't have one. I think you are 100% right. This is getting worse.

I think that businesses are choosing less costly plans, which then have these limitations in place. For example, if you work for certain hospital systems, you cannot see a physician outside of the hospital's network. If you get a position at that hospital, you either take their health insurance or you need to get a plan on the exchange. Most people opt for their employer's health insurance and then when you need it, find out that the coverage is terrible.

 

[FlowRate]

THAT's interesting. Recently I had a colleague who had a similar issue where supposedly in network deductible ends up being as high as out of network. The patients should supposedly use their HSAs in that case, but probably don't know any better and therefore didn't have one. I think you are 100% right. This is getting worse.

What I hate is that my employer opted for HSA's with no rollover. Can't use it as an investment vehicle and have to commit to $$ that goes down the drain if I don't use it by the end of the year. Pretty much expected costs only. And it's such a hassle to deal with the HSA that I'm not sure it's worth the 30% savings.

 

[GynGuy1983]

Not to get too off topic, but is anyone currently accepting any private insurance?

 

[TexasPhysician]

No one talks about actual rates and how much revenue they are generating. As a profession, we rarely talk about compensation, but complain that we are getting shafted by insurance companies. Meanwhile, we take these terrible jobs generating a ton of wealth for more administrators to micromanage everything. Just to put this out there, if you make $400/hr and work full time (37.5 hours) with 20 days PTO, that's around $800k. Meanwhile, an average hourly wage for psychiatry is $120/hr.

As for marketing, the best way to get your name out there is by doing great work. I have a website with SEO and I get a lot of phone calls, but the rate limiting step is who can afford to pay and who can't. You start to realize that a large majority of people, despite a six figure salary, are unable to float $600 a month for treatment as they await their insurance to reimburse them.

When I accepted insurance, insurance billing cost me about 5% with a clearinghouse plus another staff to manage the volume. Plus more work for me.

Have you considered lowering your fees instead of taking on more overhead? Your child fees are about 2x mine. I earn less for new typical evals, but it gets more people into my higher earning FU pool as I fill. This helps build the practice much faster. You can always raise rates as you fill.

I have a couple non-insurance contracts that I charge a higher rate for evals/FU's.

 

[countthes]

How does one go about finding what reimbursement rates various insurance companies pay psychiatrist in your area? Do you just pick up the phone and call the insurance companies telling them you're interesting in being paneled and want to know what they pay for a 90792, 99213, 99214 ect, or is the process more complicated than that? I'm trying to build a cash only PP in NYC, but I'm finding the market to be a bit saturated and so many referals I'm getting I'm loosing because I don't take insurance.

 

[dl2dp2]

How does one go about finding what reimbursement rates various insurance companies pay psychiatrist in your area? Do you just pick up the phone and call the insurance companies telling them you're interesting in being paneled and want to know what they pay for a 90792, 99213, 99214 ect, or is the process more complicated than that? I'm trying to build a cash only PP in NYC, but I'm finding the market to be a bit saturated and so many referals I'm getting I'm loosing because I don't take insurance.

You can call, ask around, etc. I'm not sure why you are taking the time to ask on the Internet---just call and find out. Most people on the Internet don't practice in NYC and wouldn't have a clue. FYI, different people in different zip codes have different reimbursement rates.

You are doing something wrong if you are in Manhattan (or prime Brooklyn), where nobody takes insurance. Not even PhD therapists and many charge $200+ a session. Only people who take insurance are NPs and clinics. If you are getting calls but not call backs, your fees are too high for your credentials. Drop your fees and I guarantee you'll fill. It might take some time though, and in the meanwhile my recommendation is work for a clinic, rather than going on panel. Once you are on panel it's hard to get off panel...