Out-of-Network Billing Strategies for Therapists: Maximize Revenue While Supporting Patient Access

The decision to operate out-of-network (OON) is one of the most significant choices a mental health provider can make. While it offers freedom and potentially higher revenue, it also requires sophisticated billing knowledge and strong patient communication. This comprehensive guide walks you through everything you need to know about successful out-of-network billing.

Understanding Out-of-Network Benefits

What Does Out-of-Network Mean?

When you're out-of-network, you:

• Have no contracted rates with insurance companies
• Set your own fees without insurer restrictions
• Don't require pre-authorization for services
• Can balance bill patients for the difference between insurance payment and your fee

How OON Benefits Work

Most PPO and POS insurance plans offer out-of-network benefits:

1. Patient Pays You Directly: Patient pays your full fee at time of service
2. You Provide Superbill: You give patient detailed receipt for insurance submission
3. Patient Submits Claim: Patient files claim with their insurance
4. Insurance Reimburses Patient: Insurer sends payment directly to patient
5. Patient Keeps Reimbursement: Patient receives partial reimbursement of your fee

Out-of-Network Terminology

Allowed Amount: Maximum amount insurance will consider for reimbursement

Usual, Customary, and Reasonable (UCR): What insurance determines is typical for your geographic area

Coinsurance: Percentage patient pays after meeting deductible (typically 20-50% OON)

Out-of-Network Deductible: Annual amount patient must pay before insurance coverage begins (often higher than in-network deductible)

Balance Billing: Charging patient for the difference between your fee and insurance reimbursement

Advantages of Operating Out-of-Network

1. Higher Compensation

Freedom to Set Rates: You determine your fees based on:

• Your experience and expertise
• Market demand
• Cost of living in your area
• Specialized training or niche focus

No Contracted Rate Limitations: Unlike in-network providers who accept negotiated rates (often $90-$140 for 90834), OON providers might charge $150-$300+

Example Comparison:

• In-Network Provider: Receives $120 per 90834 session
• Out-of-Network Provider: Charges $200; patient receives $100-$140 back from insurance
• OON Advantage: Provider keeps full $200 (67% increase)

2. Clinical Freedom

No Pre-Authorization Requirements: Treat patients based on clinical judgment, not insurance mandates

Flexible Treatment Plans:

• No session limits imposed by insurers
• Freedom to determine frequency and duration
• Ability to use creative therapeutic approaches

Reduced Administrative Burden:

• No claims to submit
• No denied claims to appeal
• No dealing with insurance company requirements
• Less time on hold with insurers

3. Practice Control

Patient Selection: Choose to work with clients who value and can afford your services

Schedule Autonomy: Set your availability without pressure to fill insurance-mandated slots

Specialized Focus: Develop niche expertise without worrying about insurance coverage limitations

Disadvantages and Challenges

1. Patient Affordability Barriers

Higher Out-of-Pocket Costs: Patients pay full fee upfront, which can be prohibitive

Reimbursement Uncertainty: Patients may not know exactly what they'll get back until claim is processed

Collection Challenges: Some patients struggle to pay before receiving insurance reimbursement

2. Reduced Patient Pool

Limited to PPO/POS Plans: HMO patients typically have no OON benefits

Socioeconomic Factors: OON model may exclude lower-income patients

Insurance Trends: More employers choosing high-deductible plans with limited OON coverage

3. Patient Education Burden

Complex Process: Patients often don't understand their OON benefits

Verification Responsibility: You need to help patients understand their coverage

Potential Disappointment: Patients may be shocked by lower-than-expected reimbursement

Setting Your Out-of-Network Rates

Research-Based Pricing

1. Know Local In-Network Rates

Use transparency tools to find:

• Average in-network rates for CPT codes in your area
• Which insurers pay highest rates
• Geographic variations within your state

Strategic Approach: Set your OON rate at minimum 1.5-2x the average in-network rate

Example:

• If local in-network 90834 averages $120
• Set OON rate at $180-$240

2. Research Market Rates

Find out what other OON providers charge:

• Check therapist directories (Psychology Today, Good Therapy)
• Call local OON practices (say you're researching for a family member)
• Join local provider Facebook groups
• Ask colleagues at networking events

3. Calculate Your Costs

Determine your overhead per session:

• Office rent
• Liability insurance
• Continuing education
• Technology/software
• Marketing
• Administrative time
• Taxes (including self-employment tax)

Break-Even Analysis: If your overhead is $50 per session hour and you want $100 profit, you need to bill minimum $150

Value-Based Pricing

Consider charging based on value delivered rather than just time:

Factors Increasing Value:

• Advanced certifications (EMDR, DBT, etc.)
• Years of experience
• Specialized expertise (trauma, eating disorders, etc.)
• Strong reputation and outcomes
• Convenient location or hours
• Shorter wait times

Tiered Pricing Strategy

Some providers offer multiple rate options:

Full Fee: $200 per session Reduced Fee Slots: $150 per session (limited availability) Sliding Scale: $100-$150 based on income documentation

Advantage: Maintains premium positioning while increasing access

Helping Patients Maximize Reimbursement

Pre-Service Benefits Verification

Essential Questions for Patients to Ask Insurers

Create a benefits verification worksheet for patients:

1. "Do I have out-of-network mental health benefits?"
2. "What is my out-of-network deductible, and how much have I met?"
3. "What percentage does insurance cover after I meet my deductible?"
4. "What is the allowed amount for CPT codes 90834 and 90837?"
5. "Is there a session limit for outpatient mental health?"
6. "Do I need a referral or authorization for out-of-network therapy?"
7. "How do I submit claims for reimbursement?"

Provide Easy-to-Use Resources

• Sample Call Script: Give patients exact wording to use when calling insurance
• Benefits Checklist: Form patients complete during their insurance call
• Video Tutorial: Create short video explaining how to verify benefits

Creating Effective Superbills

A superbill is a detailed receipt patients submit for reimbursement. It must include:

Required Information

• Provider Information:

  • Full name and credentials
  • NPI number
  • Tax ID number
  • Practice address and phone
  • License number

• Patient Information:

  • Full name and date of birth
  • Insurance ID number
  • Address

• Service Information:

  • Date of service
  • CPT code (90834, 90837, etc.)
  • Diagnosis code (ICD-10)
  • Fee charged
  • Amount paid

Professional Superbill Format

Use professional billing software or create template including:

• Your practice logo and branding
• Clear itemization of services
• Professional formatting
• Easy-to-read layout
• Contact information for questions

Delivery Timing

Best Practice: Provide superbill immediately after each session

Options:

• Email automatically after payment
• Print and hand to patient
• Make available in patient portal
• Send monthly summary for multiple sessions

Supporting the Claims Submission Process

Educate Patients on Submission

Provide Clear Instructions:

1. Where to submit (often online portal or mailing address)
2. What forms to complete
3. What documentation to include
4. Expected timeline for reimbursement
5. How to follow up on claim status

Offer Claims Submission Assistance

Value-Add Services:

• Help patient complete claim forms
• Double-check superbill accuracy
• Provide sample cover letter
• Troubleshoot rejected claims

Boutique Option: Some OON practices offer courtesy billing - submitting claims on behalf of patient (insurance still pays patient directly)

Pricing Transparency and Communication

Discussing Fees Upfront

First Contact: Mention fee structure during initial phone consultation

Before First Session: Send intake paperwork including:

• Clear fee schedule
• Payment policies
• Insurance information
• OON explanation

First Session: Dedicate time to reviewing:

• Your fees
• Their insurance benefits
• Expected out-of-pocket costs
• Payment logistics

Sample Fee Discussion Script

"I want to make sure we're on the same page about cost. My fee is $200 per 45-minute session. I'm out-of-network with all insurances, which means you'll pay me at the time of each session, and I'll provide you with a detailed receipt called a superbill. You can submit that to your insurance for reimbursement. Based on typical PPO plans in our area, patients usually receive back about $100-$140, making their actual out-of-pocket cost around $60-$100 per session. I'm happy to help you verify your specific benefits before we start."

Managing Patient Expectations

Be Clear About:

• Your full fee
• Estimated reimbursement range (not guaranteed)
• Patient's responsibility for full fee
• Timeline for insurance reimbursement
• What happens if claim is denied

Avoid Promising:

• Specific reimbursement amounts
• That insurance will definitely cover services
• To handle disputes with insurance

Payment Models and Policies

Payment Timing Options

Option 1: Pay Per Session

Process:

• Patient pays full fee at each session
• You provide superbill immediately
• Patient submits claim after each session

Advantages:

• Consistent cash flow
• Lower risk
• Simple accounting

Disadvantages:

• Can feel expensive session-by-session
• Payment disruption if patient forgets card

Option 2: Monthly Packages

Process:

• Patient pays monthly retainer
• Covers pre-determined number of sessions
• Unused sessions rollover or expire per policy

Example: $800/month for 4 weekly sessions

Advantages:

• Predictable income
• Feels less transactional
• Easier budgeting for patients

Disadvantages:

• More complex accounting
• Need clear terms for unused sessions

Option 3: Sliding Scale

Process:

• Offer reduced rates based on income verification
• Reserve limited slots for sliding scale
• Maintain documentation justifying rates

Example:

• Standard Fee: $200
• Sliding Scale Range: $100-$175 based on income

Advantages:

• Increases access to care
• Builds goodwill in community
• May qualify for certain tax benefits

Disadvantages:

• Reduces revenue
• Administrative burden verifying eligibility
• Potential resentment from full-pay patients

Payment Methods

Recommended Options:

• Credit/debit cards (with card-on-file for autopay)
• HSA/FSA cards
• ACH bank transfers
• Payment plans for established patients

Avoid: Cash (creates accounting complications) and personal checks (bouncing risk)

Payment Policies

Essential Policy Components

Due Date: Payment due at time of service vs. advance payment

Late/Missed Payments:

• Grace period (e.g., 48 hours)
• Late fees
• Suspension of services after X days overdue

Cancellation Policy:

• Notice required (typically 24-48 hours)
• Late cancellation fee
• How fee is charged

Missed Appointments:

• Full fee charged for no-shows
• Exception for emergencies
• Card-on-file automatically charged

Sample Payment Policy

"Payment is due at the time of service and can be made by credit card, debit card, or HSA/FSA card. I keep a card on file and will charge it automatically after each session. If you need to cancel or reschedule, please provide at least 24 hours notice; late cancellations and no-shows will be charged the full session fee. These fees are not billable to insurance. I'm happy to work with you on payment plans if you experience temporary financial difficulty."

Advanced OON Strategies

1. Single Case Agreements

When a patient has no OON benefits or inadequate coverage, negotiate a Single Case Agreement (SCA) directly with their insurer:

When to Pursue:

• Patient desperately needs your specialized expertise
• No in-network providers with your qualifications locally
• Patient's diagnosis requires your specific training

How It Works:

1. Patient's insurance authorizes you as temporary in-network provider
2. You accept negotiated in-network rate for this patient only
3. Typically approved for limited time (e.g., 20 sessions)

Success Tips:

• Document patient need and your unique qualifications
• Emphasize lack of in-network alternatives
• Be prepared to negotiate on rate
• Get authorization in writing

2. Membership Models

Create monthly membership in addition to session fees:

Structure:

• Patients pay monthly membership fee ($50-$200)
• Receive benefits: priority scheduling, unlimited email support, reduced session rates, group access

Advantages:

• Recurring predictable income
• Deepens client relationships
• Differentiates your practice
• Justifies premium positioning

3. Packages and Intensives

Therapy Packages:

• Pre-pay for 10 sessions at slight discount
• Reduces transaction friction
• Encourages commitment

Intensive Formats:

• Full-day or multi-day therapy intensives
• Higher total fees ($2000-$5000+)
• Appeals to patients wanting accelerated progress
• Can be more profitable per hour

4. Group Programs

Group Therapy (CPT 90853):

• Charge $75-$150 per person
• 6-10 participants
• 90 minutes weekly
• Can generate $500-$1000+ per group

Psychoeducation Workshops:

• Not billed to insurance
• Can charge premium rates
• Lower liability risk
• Leverage your expertise

Technology and Tools

Practice Management Software

Essential features for OON practices:

Billing Capabilities:

• Automated superbill generation
• Card-on-file and autopay
• Payment plan management
• Invoice tracking

Recommended Platforms:

• SimplePractice
• TherapyNotes
• IntakeQ
• Headway (handles OON billing)

Insurance Verification Tools

Check Patient Benefits:

• Availity (free provider enrollment)
• TriZetto Provider Solutions
• Office Ally

Financial Management

Accounting Software:

• QuickBooks Self-Employed
• FreshBooks
• Wave (free option)

Track Key Metrics:

• Revenue per session
• Collection rate
• Average patient reimbursement
• Monthly revenue trends

Common Pitfalls and How to Avoid Them

Pitfall 1: Underpricing

Problem: Setting fees too low, leaving money on the table

Solution: Research thoroughly, price confidently based on value

Pitfall 2: Poor Communication

Problem: Patients surprised by costs or reimbursement amounts

Solution: Discuss fees explicitly and repeatedly

Pitfall 3: Weak Payment Policies

Problem: Patients owing thousands in back payments

Solution: Require card-on-file, autopay, and enforce policies consistently

Pitfall 4: Inadequate Superbills

Problem: Missing information causes claim denials

Solution: Use professional software, double-check all required fields

Pitfall 5: No Financial Boundaries

Problem: Continuing to see patients who aren't paying

Solution: Compassionate but firm policies, offer referrals if needed

Ethical Considerations

Maintain Access to Care

Balance your financial needs with:

• Offering some reduced-fee slots
• Maintaining referral list of lower-cost providers
• Providing community resources
• Accepting some insurance to serve broader population

Transparency and Honesty

Always:

• Disclose full fees upfront
• Accurately represent likely reimbursement
• Never guarantee insurance coverage
• Provide clear, accurate superbills

Financial Boundaries

It's ethical to:

• Set fees that sustain your practice
• Enforce payment policies
• Discontinue services for non-payment (with appropriate notice and referrals)

Success Metrics to Track

Monitor these KPIs monthly:

Revenue Metrics:

• Gross revenue
• Net revenue (after expenses)
• Revenue per clinical hour
• Month-over-month growth

Client Metrics:

• New client intake rate
• Client retention rate
• Average client lifespan
• Waitlist length

Operational Metrics:

• Utilization rate (filled vs. available slots)
• Collection rate (billed vs. collected)
• Average patient reimbursement
• Cancellation/no-show rate

Conclusion

Operating as an out-of-network provider can be incredibly rewarding both clinically and financially. Success requires:

• Strategic pricing based on thorough market research
• Transparent communication about fees and insurance
• Systems and tools to streamline billing and payment
• Patient education to maximize their reimbursement
• Strong boundaries around payment policies

When done well, an OON practice allows you to:

• Earn sustainable income reflecting your expertise
• Maintain clinical autonomy and creativity
• Build a practice around your ideal clients
• Minimize administrative burden

Start by researching rates in your area, setting competitive yet profitable fees, and developing clear systems for patient communication and billing. With the right approach, you can build a thriving out-of-network practice that serves both your patients and your professional goals.

---

Want to see what insurers actually reimburse out-of-network in your area? Search our transparency database to find allowed amounts for CPT codes 90834, 90837, and more across all major insurance plans.