Should I Take Insurance?
If you’re wrestling with whether to take insurance, you’re in very good company. This is one of the most common private practice questions I hear, and it shows up in many forms:
“I want to serve my community, but I can’t afford to work for $XX per session.”
“I love the steady referrals, but I can’t keep up with denials and clawbacks.”
“Prior authorizations for testing are exhausting and time-consuming — is it worth it?”
“I’m just starting out and I don’t know what’s realistic.”
People tend to answer this question with extremes. Insurance is often framed as either exploitative and impossible, or as the only ethical choice. Neither framing is helpful when you’re trying to build a sustainable practice within real-world constraints like time, overhead, burnout, and personal capacity. What does help is honest, accurate information.
For context, I’m a licensed psychologist who has billed insurance for psychotherapy and psychological testing for the past 11 years. I’ve learned a lot through trial and error. I currently own a group practice where we continue to accept insurance, but my thinking about insurance, and how I help clinicians decide, has evolved over time. I’ll share that perspective here.
This article isn’t here to convince you. It’s here to offer a clear framework so you can make a decision that fits your values, your services, your capacity, and your goals, without feeling pressured to pick a side.
First, a Reframe
Taking insurance is not a moral stance.
Not taking insurance is not a moral stance.
Even though it can sometimes feel that way, especially in a field like mental health that deeply values social justice and access to care.
Instead, think of accepting insurance as a practice design decision. Like most design decisions, it involves tradeoffs. Access, sustainability, geography, specialty, and personal bandwidth all matter. Problems arise when clinicians inherit strong opinions without examining whether those opinions actually fit their circumstances (which, incidentally, is something we routinely encourage our clients to do).
The goal is not to choose the right model. The goal is to choose a model you can maintain ethically and sustainably.
Step One: Clarify Your Non-Negotiables
Before looking at reimbursement rates or administrative burden, start with your boundaries.
Ask yourself:
How many clients do I realistically want to see per week?
How much administrative work can I tolerate without resentment?
How important is schedule flexibility?
Do I need predictable income right now, or can I tolerate variability?
Am I building a solo practice, or something larger?
Who is my ideal client? Would that client likely self-pay, rely on insurance, or both?
What services do I want to provide, and are those services typically covered by insurance?
These questions matter more than any spreadsheet because they help align your practice with your values and capacity (yes — there’s some ACT work hiding in here). A model that looks profitable on paper but violates your bandwidth will eventually collapse or leave you burned out and questioning your career choice.
Step Two: Understand What Insurance Actually Changes
Insurance affects three core areas of practice.
1. Revenue Structure
Insurance typically offers:
Lower per-session reimbursement
Being in-network means agreeing to a discounted rate. For example, instead of collecting $200 per therapy session, you may receive $150. In return, insurance companies funnel clients to you.Higher demand and steadier referrals
Being paneled often means your phone rings more. If you rely on consistent income, this can be reassuring.Less control over fees
While negotiation is sometimes possible, most insurers have fixed fee schedules with limited flexibility.Delayed payments
Although many insurers pay within 2–3 weeks, delays are common. I’m still waiting on payments for services rendered months ago.
Private pay typically offers:
Higher per-session rates
If your rate is $200, you collect that amount directly and immediately.Greater responsibility for marketing and retention
When referrals slow, you must actively market or network. Depending on geography, this may be easy — or very difficult.Faster payment
Most clinicians charge clients the day services are rendered, eliminating payment delays.
Neither model is inherently better. They simply reward different strengths.
2. Administrative Load
Insurance adds labor and expenses, including:
Credentialing (often $200–$400 per insurance company, 1x fee)
Claims submission (EMR fees and/or biller fees, typically 4–7% of revenue)
EOB and ERA review
Policy interpretation
Private pay adds labor in other ways:
Marketing and networking
Conversations about fees and changes
Payment collection
Explaining value and scope of services
There is no admin-free model — only different kinds of labor.
3. Clinical Framing
Insurance-based work often requires:
Diagnosis
Medical necessity language
Knowledge of CPT codes and payer rules
Periodic documentation alignment
Disclosure of some client information to third parties
Private pay allows:
Greater flexibility in framing
Fewer external constraints
More protection of client information
Ongoing monitoring of financial sustainability for clients with limited resources
Some clinicians find insurance framing aligns well with their work. Others experience it as intrusive. That reaction matters.
Step Three: Consider Access
Insurance undeniably increases access for many clients. Without insurance, many people simply cannot afford mental health care. (We need systemic change here.)
It’s also true that:
Not all clinicians can financially survive on insurance alone
Some services are not covered or deemed “not medically necessary”
For some clients, using insurance poses risks to future goals or feels politically unsafe
Burnout reduces access long-term
A closed practice serves no one
You are not required to sacrifice sustainability to prove ethical commitment. Access is a systems issue, not an individual burden.
If accepting insurance isn’t feasible for you, there are other meaningful ways to increase access:
Maintaining one full pro bono slot
Offering low-cost or sliding-scale services
Supervising trainees who provide reduced-fee care
Exploring grants or alternative funding models
Step Four: Evaluate Your Stage of Practice
The “right” choice often changes over time.
Early career: Insurance can provide structure, referrals, and financial stability.
Mid-career: A hybrid model may make sense, allowing you to keep higher-paying panels and drop lower ones.
Later career: Private pay may better align with focus, capacity, and referral flow.
Decisions made at one stage don’t have to define your entire career. Regular check-ins matter.
Step Five: Run the Numbers (Realistically)
If you run the numbers, do so gently and honestly.
Ask:
If self-pay only, what rate could I realistically charge and fill?
How many sessions per week would I need to meet my financial goals?
For example, in the Las Vegas area:
Psychologists often charge ~$200/session
Master’s-level clinicians often charge ~$150/session
At 25 sessions/week for 48 weeks/year:
Private Pay
PhD: ~$240,000 gross
MA: ~$180,000 gross
(before overhead)
Insurance (typical averages, PhD rates are about $150 in our experience; MA rates are about $100 in our experience)
PhD: ~$180,000 gross
MA: ~$120,000 gross
(before overhead)
The biggest risk with self-pay is under-filled caseloads. A half-full self-pay practice may earn less than a full insurance-based one. Geography, referral networks, and ideal client profiles matter.
Common Traps to Avoid
Believing myths about insurance (e.g., “you’ll never get paid”)
Choosing insurance out of guilt
Avoiding insurance out of fear
Making decisions based on someone else’s anger or experiences alone
Assuming one choice is permanent
A Final Thought
The question isn’t “Should I take insurance?” A better question is: “What practice structure allows me to provide good care without compromising my own stability?” When that question is answered honestly, the insurance decision usually becomes clearer.
