Why Therapists Need to Get Paid: An MFT Private Practitioner’s View



I would like to offer a candid, behind-the-scenes look at the way therapists get paid. As a marriage and family therapist who transitioned from a solo private practice to a group practice, I will highlight the unique challenges we face in getting paid and provide insight into the myths and limitations of our earnings. Like other professionals, therapists in private practice are compensated for their work, but only for the time spent with a client: our livelihood is directly tied to clients attending sessions. If a client cancels or doesn’t show up, we are not paid for that time, including the time we took to prepare for the session. Most private practitioners are not salaried, and the financial stability of a practice, whether solo or group, relies on insurance reimbursements. Insurance rates are fixed and vary in pay.

When we consider the fact that time is a precious commodity, it becomes clear that how we utilize it directly affects our quality of life. For therapists, everything depends on filling and completing a client hour, and our time loses value when a client does not attend their appointment. Late cancellations and no-shows have a significant financial impact on us. Consider a scenario where a client requests a 5:00 p.m. appointment on Friday and fails to attend without good cause. Here is what happens … the therapist waits 10-15 minutes for the client before reaching out to check if the client is on their way. When the client doesn’t respond, the therapist continues to be concerned about the client’s well-being and loses an hour of pay because you cannot bill insurance for a missed appointment. Now, the therapist is in the difficult position of charging the client for their missed appointment—a practice that the client often misunderstands, potentially creating tension in the therapeutic relationship.

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For therapists who rely on insurance, the payment process is not as straightforward as it may seem. We are paid per time increments of 30, 45, and 60 minutes, but we are only fully paid once we receive reimbursement from the insurance and the client. When clients fail to pay their co-payment or co-insurance at the time it is due, the therapist is left with dents in their cash flow. It also creates a situation where they make less money for their time, which increases the effort needed to collect the funds. The more hours therapists spend collecting from clients, the less they make per hour. In fact, the terms and conditions of most insurance contracts include an obligation to collect the co-pay and/or co-insurance payment from the client. The same is true of those who have a deductible. The deductible must be paid to the provider (us) because the amount is applied toward the client’s benefits. When someone refrains from paying the deductible, they are receiving free therapy while getting money added toward their deductible.

Debunking myths about therapist’s pay

“Therapists get paid their full fee”

It is easy to see why one might think therapy is too expensive. After all, the therapist’s website says they charge $150 per hour of treatment, which adds up to $600 per month. Who can afford that? However, digging deeper, you will find that most therapists are not paid what they charge. The difference between the clinician fee and what insurance pays is significant! For those paneled with insurance companies, their pay is dictated by the insurance companies they are paneled with. Each contract is nuanced and has set reimbursement rates for various sessions. For example, one insurance company might pay $100 per session while another pays $75 for the same session. Clinicians set fees higher than reimbursement rates to ensure they receive the full reimbursement. Broken down, it goes like this—If your fee is $90 and the insurance pay rate is $100, you will only be paid up to the $90. Even though the contracted rate is $100, you will only be paid the full rate if your rate is equal to or higher than theirs. The therapist needs to set a higher fee than the top reimbursement rate if they want to be paid the total contracted rate.


“Therapists get paid twice as much for couples work”

While it may be hard to believe, insurance pays less for a couple or family session, which is often more work and stress for the clinician than for an individual session. Couple and family therapy requires a unique skill set not reflected in the reimbursement rates. Therapists can only bill under one person in the couple or family, and the rate for that is, on average, $10 an hour lower than that of an individual hour. While our set fee may appear high, a paneled clinician receives far less than their fee-for-service rate because they want clients to have the ability to access care through their insurance companies. But we have no control over their fixed rates and rarely get a meaningful increase. And when we do, it is a matter of dollars and cents.

“Late fees equal co-pays”

Most clients do not realize how their absence impacts a therapist’s livelihood. Some believe the late cancelation fee is the same as their co-payment, which ranges from zero to $40. However, as therapists, the hour is lost. The insurance protocol is clear. We only get paid for time spent with clients, which relies on them showing up on time for appointments. When a client cancels late or does not show up, the therapist loses their reimbursement for the time they planned and showed up for.

Most practitioners struggle with setting a cancellation fee for late cancellations and missed appointments. Our service agreement has a policy asking for 24-hour notice so we can plan our time efficiently and not be in a position to charge for the appointment. The fee we set for this policy must make business sense, and a small co-pay does not do that. Think about it. If insurance pays $100 for a session and you charge a co-pay fee of $25 for late cancelations, you lose 75% of your income. I don’t think many other professionals can offer to be this generous.

Remember that ethical billing practices are predicated on time and ensuring we bill each unit of time correctly. When a client is 10-15 minutes late for a session, we have to bill for the appropriate time, lowering our hourly pay. We have a cancelation policy to ensure clients understand that we need advanced notice to plan for the missed hour properly. It is time that can be filled with another client, and a therapist may say no to someone asking for a particular timeframe because it is already filled.

“You didn’t go into it for the money”

While it is true that therapists are empathetic and caring, they are also entitled to be paid a living wage for their services. They did not spend years becoming professional therapists to be devalued and underpaid for their work. And they are not doing the work to be merely charitable but rather to help others find healthy ways to live their lives. It is incorrect to assume that therapists choose their line of work only out of the goodness of their hearts. Our desire to help others cannot be defined purely by good intentions. Many brilliant therapists are in it because they found something that aligns with their abilities, but we must not mistake this fact for them not being interested in being paid for it.

“Hard work equals being well paid”

It is a misapprehension that hard work necessarily pays off or pays well. To say to a therapist, “I worked hard to get where I am,” presumes that the therapist did not do the same. Private practice or otherwise, therapists work hard and often carry much of their labor with them when the day is done. According to salary.com, the average licensed marriage and family therapist salary in Chicago, IL, is $47,126 as of March 26, 2024, but the salary range typically falls between $41,133 and $53,629. Clearly, these figures are not a reflection of how hard the therapist works or they would be significantly higher. The problem is not with their work ethic; compensation for other professionals is considerably higher than for mental health professionals who provide an essential service to their communities.

Behind the scenes and why it matters

Therapists play a crucial role in supporting mental and emotional well-being; just as in any other professional endeavor, they must be paid for it. Some noteworthy considerations about why we need to be paid that are often eclipsed by misconceptions about our altruistic nature include:

Our time and expertise

When you pay for therapy, you compensate for the therapist’s time and expertise regardless of the outcomes. While compassion and care are fair expectations, you are also getting the therapists’ knowledge and guidance, which they spend considerable time and money acquiring and crafting. Therapists invest years in education and training. They attend accredited graduate schools, fulfill rigorous internships, often unpaid, and work for at least two years under an approved supervisor to meet the qualifications to sit for state licensing exams.

Workload and hours

A therapist’s work extends beyond the face-to-face session. They spend time on paperwork, making phone calls, and preparing for each client. Most solo practitioners even take on the task of billing, which can take hours when insurance claims are rejected, denied, or paid late. To be paid “well,” a therapist needs to consistently see 40 clients a week, which is nearly superhuman!  Most therapists cannot fulfill such a caseload. Imagine seeing eight clients daily, five days a week, added to the administrative load of preparing, completing notes, creating and updating treatment plans, returning emails, phone calls, and billing. To clarify how this looks in reality, it amounts to approximately 55-60 hours per week. That is 15-20 unpaid hours of work. It puts the therapists at risk of burnout and is unfair to the clients they serve, who are at risk of getting less attention from an overworked clinician. In essence, the therapist’s pay is nowhere near their full rate or that of the insurance rate.

Overhead costs

Like any business, practitioners have overhead expenses such as rent, marketing, website design and maintenance, electronic health records, advertising, accounting fees, licensing fees, continuing education fees, professional dues, and taxes. New costs have emerged from the pandemic, including maintaining both a physical and a virtual space. There are also hidden costs in staying compliant with the profession’s best practices.

Skill and compassion

Therapists possess specialized skills. As MFTs, we know that our training represents something unique in the mental health field; we see the whole person in the context of their relationships, and we know how to work with multiple clients with vacillating interests. We put out emotional fires and work hard to preserve essential relationships in our client’s lives. While we are compassionate, we also have skills. We actively listen, formulate appropriate interventions, set goals, engage in treatment planning, and ensure the safety of every client in our room. We hold ourselves accountable for any personal feelings that could interfere with providing treatment. We are masters of our craft, and it must exist in the absence of hubris. We do not get bonuses for our fine-tuned skills. Yet, we are often underestimated with respect to the monetary value of our help in navigating complex emotions, trauma, and personal growth.

Cost of living

The therapists’ fees, of course, must cover their costs, reflecting the local cost of living, which has been higher than at any other time in history. The post-pandemic world—and therapists worked tirelessly to support clients during and after the pandemic—has resulted in a higher price tag for essentials as well as luxury items. The domino effect on the economy has changed the trajectory of what people can save for the future and extended the retirement timeline for many, especially therapists whose income is limited by insurance rates.

A therapist in private practice does not get a cost-of-living increase like those in salaried positions. It is a choice to be in private practice, one that has come out of a long history of being paid even lower wages in a different setting. In a salaried job, the therapist can predict how much compensation will be received per pay period. In private practice, the amount fluctuates from pay period to pay period, and when a client does not pay on time or at all, it strains the clinician, who needs to be paid regardless.

I hope this behind-the-scenes look has shown that therapists deserve fair compensation for their time, expertise, and unwavering commitment to helping others.

A therapist in private practice does not get a cost-of-living increase like those in salaried positions.

VB LTG website photo

Vanessa Bradden, LMFT, is the founder and director of Lakeview Therapy Group in Chicago, IL. She is a longstanding professional member of AAMFT and an AAMFT Approved Supervisor. Vanessa started her solo practice in 2009 while raising her three children. She gradually expanded into her current group practice, which came together quickly due to the pandemic and an inability to keep up with the high demand for therapy. Vanessa mentors new therapists and is dedicated to providing them a space to learn, grow, and develop themselves as the next generation of systemic therapists.

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