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Mental Illness and Debt: How to Handle Patients Who Don’t Pay

What do you do when a patient with behavioral issues won’t pay? As Dr. Dinah Miller, MD, wrote, “Make sure you get paid; these cases are difficult.” 

Even patients who seem to be in great financial shape can flip the tables and drown their resources on a spending spree. Dr. Miller recounted one customer who lived a flashy life of exciting getaways and lunches with athletes, and sported designer clothes with a check in hand during every session. Over a brief period of time, however, her client’s lavish lifestyle sank him tens of thousands of dollars in debt and she noticed that he began missing payments. By the time Miller consulted her mentor, she was embarrassed to admit that she had fallen behind in over $1,000 of professional therapy fees.

Here are a few tips to follow to handle patients who don’t pay in the mental illness field to make sure what happened to Dr. Miller doesn’t happen to you.

Seek Guidance from an Experienced Professional

The wisest move Dr. Miller made was to seek help from an older advisor who counseled Miller to either get paid or terminate the sessions. Often, compassion clouds our judgement, and questions of why the patient can’t pay may come to the fore. Younger psychiatrists especially may feel pressured to do more pro bono work run the risk of being taken advantage of. Talk to an older professional in the field to help you decide how to approach the patient, what questions you need to ask, and what procedures to put in place to make sure it doesn’t happen again. And you’ll have someone to bat for you if the patient ‘forgets’ their check again or is late on another payment.

Be Nonjudgemental 

Since a patient who is unwell may be quite reactionary to any suggestions coming his or her way, it’s important to be as understanding and as nonjudgemental as possible when handling the situation. Ask questions and wait for answers, let the patient understand his or her motive not to pay, and breach the subject as a therapist and not a financier. All these go a long way in establishing the relationship with your patient and help you get paid. It’s important to set the ground rules, though. Any form of grace extended to your patient may be seen as lenience to continue letting the checks slide. Let them know it’s the policy – not you – that sets the rules.

Schedule Fewer Sessions

When a client undergoes financial hardship, it is appropriate to request that you could see each other every other week or once a month, according to Steven Reidbord, MD. In some cases, like Reidbord’s, the psychiatrist can even adjust their fee in order to allow visits to continue.

Get Paid Through an Insurer

When clinicians participate in commercial health insurances through an employer, psychiatrists can accept payment through the client’s insurer. The patient handles their own deductible and copay. Unpaid bills build up tension, and it’s better than not to have a middleman to go through.

Help Patients Stay Out of Debt

The best way to stay out of bad patient debt is to keep from accruing it. Make clear policies on co-pays, deductibles, and self-pay procedures to ensure that you earn money in the long run. Also check to see that your client is working with a credentialed provider who has a behavioral healthcare plan as part of their benefits. 

Ask for Payment

If a patient is not able to pay, work on a payment plan and definitely follow up on it. When your client arrives, staff should be verifying them at the door and checking for their deductible or copay. Letting clients know what the payment and the deductible are, makes it much easier to manage on the front end. Also, having a write-off policy helps manage debt and keeps you clear from any accusations of fraud that may come in the future.

Hire a Collections Agency

A full-service collection agency may be just what you need to finally get that last unpaid check from a client. It may be a last resort, but collections agencies help collect past due invoices that won’t come in any other way. For a no-money-out-of-pocket alternative, call Southwest Recovery Services for fast collections help right away.

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