Why is therapy so expensive?
Eliza Wells, MS, LMFT
Pronouns: she/her, they/them
Staff Psychotherapist
One of the primary complaints that I find people often have against therapy is the cost. It should be free, right?
Well honestly, I really don’t disagree with you. I would be thrilled to be in a place where I could provide therapy for free. I believe that it's healthcare. And while I hesitate to ever say that anyone needs therapy, I strongly believe that everyone deserves therapy who wants to access it.
Unfortunately, the system that we currently operate under in this country doesn’t make this easy. It actually seems to make it as difficult as possible in many ways.
The Process of Finding a Therapist
The steps a person has to go through to find a therapist that looks like they might 1) have the skills to help them, 2) be a good personal fit, 3) have availability and 4) have a schedule that is compatible is already a great investment of time.
Imagine getting to the end of that pipeline and then realizing that the therapist you have found is not in network with your insurance and you have to pay perhaps $50-$300/session. Or, even if they are in network with your insurance, you might still owe $10-$60 per session as a copay, or somehow have to pay their entire fee for a part of the year to reach your deductible!
Sometimes it’s better to start with a pool of therapists who you already know take your insurance or offer sliding scale out-of-pocket fees that you can afford–but sometimes this really limits who you’re able to see.
Typically, as therapists become more experienced and advanced in their careers, they limit the amount of insurance types they are paneled with and increase their fee for service. This isn’t done to be intentionally inaccessible so much as to obtain some standard of living for themselves and make up for years if not decades of paying back student loans and making little (if anything) during their initial training and pre-licensure. Some insurance companies pay their paneled therapists closer to their requested rates than others, so it’s often easier to find providers that take those plans.
Therapists who are more experienced may also have more limited hours (daytime or weekday only) and have smaller caseloads. Making a career as a therapist sustainable may require a lot of conscious thought into a person’s capacity, not only for the health of the therapist, but by extension to ensure that the therapist is able to provide adequate care to all of their clients in the long term. Unfortunately, the beginning of a therapist’s career often does not make much room for this.
The Process of Becoming a Therapist
When a therapist is first providing therapy as an intern, they are almost never compensated with anything as they are still a student. Yet it is real work that they are doing which makes it difficult to maintain another job at the same time. Once we graduate, we obtain our first licensure level where we are able to practice and bill insurance, but we have to do so through a supervisor who has obtained their independent licensure.
In private practice, this supervisor takes a high cut (typically at least 50/50, if not more) of any amount that we bring into their practice. This can go on from anywhere from 2 years or longer–until the therapist collects enough client hours and passes their state licensure test and obtains their own independent license. This cut is thought to make up for the extra needs involved in properly supervising and training a new therapist as well as any liability taken on.
Once a therapist obtains their independent licensure, they might receive a raise and then receive 55-60% typically of what they bring into a practice. The hours are still unpredictable, though. It takes time to build a steady case-load, and people go in and out of therapy and participate on different schedules.
Therapists who work for hospitals, schools, or practices that offer salaries might be able to make higher paychecks and have more consistent hours, though sometimes they end up with such a high and dense caseload that they can’t sustain it.
For a therapy session, the typical rate might be somewhere between $130-200. Sometimes it’s a bit lower, and sometimes it’s even higher. An insurance plan might reimburse $20 of that or $130 of that. Then, the therapist takes home about half, maybe a bit more.
Or, they are paid an hourly rate that has little to do with whatever this number is that the client actually pays to see them.
So How Much Does a Therapist Actually Make?
Basically there is no straight forward answer to this question, but I can tell you from a quick Google search that most people have absolutely no idea and drastically overestimate it, which is why I decided to write this blog.
No matter what rate is set for a therapy service, insurance companies get to decide what they’re willing to actually pay for that service. So if we want to be “paneled” with an insurance so that we can see clients through that plan, we have to apply and accept whatever rate it is that they offer. We can try to negotiate, but it’s often unsuccessful. Every insurance is different.
So the rate that your therapist will receive is likely quite a deal lower than what it is you see your therapist charging, or even what your insurance is paying them. And another factor is that most therapists are not actually seeing clients 40 hours a week, which means that they aren’t always doing 40 hours of paid labor a week, even if they are actually working 40 hours a week.
Trust me, you really don’t *want* to see a therapist that sees 40+ clients per week. Think about it-that’s 40 hours of face-to-face interaction per week, not even including all of the other tasks that seeing clients involves! When will your therapist eat? When will they use the bathroom? Will they even have a voice, or maybe they just won’t talk at all in session in order to keep themselves going? It’s not sustainable! You want to be able to feel like you’re your therapist’s only client–and most of us like to keep our case-loads small enough for you to feel that way. We want to be able to provide you our full, undivided attention as much as possible each time we meet.
Most therapists who are full-time see 20-30 clients/week. But this can vary and be incredibly inconsistent. Some people like to see their therapist twice/week, weekly, monthly, or even just on an as-needed basis. So we need to charge enough in order to make up for the hours that we aren’t able to see clients, or for the random holes in our schedule that will inevitably appear due to clients taking time off from therapy or canceling their sessions. We never want clients to have to consider their financial impact on us, so it’s better to charge enough so that we can put it aside for times when our weeks are lighter.
It’s also notable that some therapists do not receive PTO, vacation days, sick days, insurance benefits, or 401k benefits. In fact, it’s more common to not receive any of these benefits at all in this field–but more recently insurance and some PTO hours have been required.
Particularly therapists who operate from their own practice and charge those higher end fees, do so because they need to put aside money for that time on their own. Others who do receive these benefits often belong to a group or an agency that takes a percentage of what they make per session, which covers things like rent, marketing, and billing.
So even if we are making a decent wage, we have to be incredibly thoughtful about putting aside extra for vacation, sickness, or even emergencies that might make us unable to see our clients.
What Else Does a Therapist Do Besides See Clients?
Our session fees also compensate for other tasks we are responsible for in maintaining a case-load that don’t generate income. This includes things like billing, supervision and consultation, documentation, and taking trainings that keep us informed and are required for us to renew our licenses (which also costs money!).
You’re not just paying for 45 minutes-an hour a week, you’re also paying for…
Administrative Tasks-If you use insurance, often times when we submit a claim for payment we don’t receive that payment from them from anywhere from weeks to months. Insurance can miss or forget payments or reimburse us the wrong amount, and it’s on us to chase them down (think spending hours on hold!) or accept the loss. Oftentimes when a therapist works for a group practice, part of what the practice’s cut covers is handling insurance coordination and billing. At Sage Stone, this is done by our practice owner.
Supervision & Consultation-Therapists are required by our ethical code to seek out supervision and support from other therapists when something is beyond our scope of competence or education. Sometimes this is provided for free by our practice, but other times we have to pay for someone’s time. At Sage Stone, we are lucky enough that our practice owner pays us to coordinate with each other!
Our financial Security- Unfortunately, most therapists are not provided PTO, vacation, or sick days, 401K’s, and sometimes not even insurance benefits. We need to save what we make and budget to keep ourselves afloat. At Sage Stone, we are incredibly lucky that we receive 401K benefits and PTO, and our practice owner encourages us to use it!
Documentation-Therapists are required to maintain certain documentation for each client to be in accordance with our licensure and to justify medical necessity to insurance.
-Progress Notes: Required for each session and take anywhere from 5-15 minutes each
-Treatment Plans: Best practice is to update/review these every 3-6 months. These can take up to an hour depending on complexity. Treatment plans include a diagnosis, projected length and frequency of treatment, client goals and symptoms, and models that might be used to provide relief.
Other-more documentation might be needed including contact between sessions, consultation with other providers, or changes to treatment.
Our expertise- we are ethically obligated to pursue continuing education in order to keep renewing our license and stay current in new research and evidence based practices. At Sage Stone, our practice owner actually pays for these training sessions and pays us to attend them out of the percentage they take from our session fees!
A (permanent) place in our hearts and in our minds.
Therapists care about their clients in and out of the therapy space.
What Can I Do To Make Therapy More Affordable?
Advocate with us! Therapists are doing all that we can to vote and protest for better reimbursement rates from insurance.
Seek out therapists who offer a sliding-scale. You can find this on websites such as Open Path, where therapists charge between $40-70 out of pocket. Many therapists keep at least a couple of sliding-scale spots reserved on their caseload, and you’re always welcome to ask if we have one available that you could take-the worst we can say is that they’re currently full, but you don’t know if you don’t ask. Almost all of our therapists have at least one sliding-scale or even pro-bono client, if not several. An important value of our practice is to make therapy affordable and accessible. If we can’t meet you financially, we want to help find you a therapist who can.
When you have a choice in your insurance plans, consider the mental health benefits. Some plans have copays as low as just a few dollars, whereas others have large deductibles or may simply not be in network with many providers. If your insurance plan is in network with most therapists, they likely compensate their therapists pretty well. If they aren’t, complain! You deserve to have access to a wide choice in providers.
Talk to your therapist about it! We want therapy to be accessible and will work with you whenever we can.
Contact us today if you’d like to learn more about our services and how we can support you on your journey towards healing and recovery. You deserve validation, understanding, and compassionate care.
At Sage Stone Counseling, we hold that everyone should have the right to mental health care. We focus on providing affirming and safe therapeutic space to marginalized groups of all kinds, and are here to help. If you or a loved one is seeking support from a therapist, consider contacting us today. .
