What Goes into a Therapist’s Fees?

There are a lot of misconceptions around the cost of therapy.

Out-of-pocket therapy costs can range anywhere from $70-$300 a session depending on the therapist, location, and their practice.

One thing that is clear is that therapy can be expensive!

Does this mean that therapists are making tons of money? Absolutely not. According to data from ZipRecruiter.com the average private practice therapist salary is ~60k a year. That is significantly lower than many other master’s level careers. So, if therapy seems to cost a lot, but therapists aren’t making that much money then where does all the money go?

Let me explain. Most therapists are only paid for the hours in which they see clients, but one client hour does not equal one hour of work. There is a lot of work that is done behind the scenes by therapists.

The journey begins well before a therapist’s first day on the job. By the time a therapist is able to see clients as a paid professional they have already had to fund their education through loans, scholarships, work, or outside help. Therapists also spend at least a year working as an unpaid graduate intern therapist before they are able to graduate and become a “registered intern.” The norm is for graduate internships to be unpaid despite the fact that the student intern is usually seeing clients alone in the room and has already completed the bulk of their coursework. The graduate internship fills the role of a practicum and is intended to teach the student about working as a therapist while they are still able to speak to professors and receive guidance. However, this internship is an unpaid, nearly full-time commitment. I did my internship at a non-profit community setting where the sessions were free, but at many sites student interns are seeing clients that paid for the therapy and not receiving any compensation themselves.

Are you confused already? I certainly was.

The road to becoming a therapist, contrary to popular misconceptions, is a long one that requires many sacrifices, some exploitation, and a lot of investment.

Personally, I did it because I care and consider it a privilege to do this work. It was hard at times, but worth it in the end.

Once a therapist is able to become a pre-licensed professional (registered counselor intern or RMHCI, in Florida) they are able to either join an organization or start their own practice given they meet certain legal requirements.

This last option, is a popular choice for any therapist (pre-licensed or not) because it allows the therapist to opt out of the many layers of healthcare systems and provide client care directly. Running your own practice is also a great way to cut down on additional costs to the client and provide more flexibility in treatment options. When you run your own practice, there is no additional profit that needs to be generated. You are trying to provide a service and a salary for yourself. The equation is a simple one.

So…What goes into the fees for solo private practice?

A solo practice, such as mine, relies on the session fees to cover business expenses such as: office rent/utilities, HIPAA compliant confidential software, billing, marketing, maintaining professional listings, malpractice insurance, professional supervision, scheduling, supplies, etc. Some of those tasks are outsourced ($$$!) or can be done by the therapist themselves. All of it requires money and time and is accounted for in the session fee.

A private practice therapist, depending on their case load, might be at full-time with anywhere between 15-25 clients. 15-25 paid hours a week have to cover the remaining hours of work and expenses. Therapists cannot see 8 clients back to back 8 hours a day, 5 days a week. The nature of the job doesn’t allow for that. Space has to be given between sessions for emotional processing and taking notes. We’re humans and like anyone else, we have to pause in-between and think about what just happened in our sessions, so that we can be prepared for the next client. There is also a bulk of paperwork that has to be completed after each session as therapists keep detailed records of their work and the client’s progress. I try to schedule my appointments with 30 minutes in-between clients, so that I can show up ready to listen for each and every session.

The type of clients that a therapist sees might take more time behind-the-scenes as well. Clients in crisis, working with kids/families, writing letters, speaking to healthcare professionals on behalf of the client, researching diagnoses, researching treatment methods, paying for additional trainings to learn new skills, consulting with other therapists, and just sitting with all the heavy things we do hear takes up time. All of this goes into the session fee.

Why choose a solo private practice therapist then?

Well, the answer is simple: because it represents just one person and one salary. A larger, for-profit system like a group practice or agency has to generate salaries and profit for many individuals. The overhead costs are much higher as well. In some cases, individual therapists are pushed to see more and more clients which can lead to burnout and compassion fatigue. The session fees are also usually higher as the therapist is only receiving a portion of that fee. The equation is even more complicated if the agency works with insurance as the insurance company also has to get their cut.

For many, taking insurance is not always an option. Insurance companies provide low reimbursement rates to therapists (sometimes less than half of the session fee), which drives therapy prices up. Insurance companies notoriously refuse to pay therapists at times in what is called a “clawback.” When this occurs, the therapist does not get paid and has to negotiate with the company to figure out why the claim was denied. Most therapists are not making enough money to be able to wait to get paid or risk not getting paid if they lack the time to deal with the claims. Many group practices and even solo practices that take insurance hire a separate employee, a biller, to take care of the insurance paperwork. This is another added expense. Also, insurance companies require a formal diagnosis to proceed with treatment and they can even decide on the length or type of treatment they will cover. Why should a company that does not even know the client get the final say over their treatment plan? Insurance can obviously be valuable in that it provides care for people who otherwise wouldn’t be able to afford it, but it is a nuanced choice for a therapist to work with it. In my case, I simply don’t accept insurance and instead I offer a number of sliding scale spots for clients in financial need.

When you choose a solo therapist, you are not paying into a complex system.

It is a simple equation: you are paying for your therapist’s time that week and all the time it takes them to make the personalized experience that is their practice.

You are directly paying the one person who is doing the real work of sitting with you and supporting you through hard times.

Therapy is a field dominated by women and solo private practices represent a small business model for mental health care. Therapists are not in the field to make lots of money as the media often portrays. In fact, there are lots of other master’s level careers that make a lot more money!

We are here because we care.

Personally, my practice is my baby.

Every single book, plant, box of tissues, and throw pillow in my office was something I lovingly chose thinking of my own personal vision for what therapy ought to be.

I think of my clients and my practice all the time and how I can make a better experience.

I have the freedom to work with whatever issues I want to work with. I never feel the pressure to take on too many clients or work with issues that I am not passionate about. My work is driven by my own curiosity and desire to help.

I understand that therapy is a huge expense, but I don’t take that lightly. I prioritize providing affordable options and always try to make room for sliding scale clients. I hope that this explanation has helped demystify some of the process. I am always open to answer any additional questions you may have!