AVOIDING LIABILITY BLOG

Waiving the Copayment

November 2010

… This topic was discussed in the last Avoiding Liability Bulletin (October 2010). It raised a few questions from a reader that I thought deserved mention here. The reader described a situation where the patient is unable to pay the copayment because he or she forgot the checkbook, or was not carrying enough cash. Is it okay to bill the patient in such a situation? What if the copayment is regularly billed to the client – is this okay? Does the insurance company have the right to instruct the therapist or counselor not to see the client? These questions are answered below.

It has been my view and my experience that the issue of waiving the copayment arises in a few ways. One way was described in the October Bulletin, which was to expressly agree to waive the copayment in advance. There is a more subtle way to waive the copayment, and that is a situation where the practitioner agrees to bill the patient or client for the copayment and in some way indicates to the patient, with the proverbial wink and nod, that there is no expectation of payment upon receipt and that the debt would later be forgiven. This kind of practice is typically viewed as fraudulent. On the other hand, if the patient is regularly billed for the copayment and the patient makes periodic payments, this would, in my view, be appropriate and should not be opposed or criticized by insurers (although I cannot vouch for what they may do or say).

I have never experienced a situation where an insurance company told a therapist to refuse to see a client because the client was billed for the copayment. I would think that such action could result in liability for the insurance company. I think the focus of the insurance company is on whether or not there is a good faith effort to collect the copayment called for in the insurance contract. Speaking of insurance, I want to clarify (based on what I heard from another reader) that my article in the October Avoiding Liability Bulletin regarding insurance fraud related to insurance companies as opposed to managed care companies. In managed care, the therapist has agreed to accept a set hourly fee for services performed, which may vary from company to company. With a true insurance company and an insurance policy, the therapist or counselor can charge the patient his or her usual and customary fee and be reimbursed by the insurer, less the amount of a copayment, which is paid by the patient.

ABOUT THE AUTHOR

Richard Leslie: Avoiding Liability Bulletin

"At the Intersection of Law and Psychotherapy" Richard S. Leslie is an attorney who has practiced at the intersection of law and psychotherapy for the past twenty-five years. Most recently, he was a consultant to the American Association for Marriage and Family Therapy (AAMFT), where he worked with their various state divisions to develop and implement their legislative agendas. He also provided telephone consultation services to AAMFT members regarding legal and ethical issues confronting practitioners of diverse licensure nationwide. Additionally, he wrote articles regarding legal and ethical issues for their Family Therapy Magazine and presented at workshops on a variety of legal issues. Prior to his work with AAMFT, Richard was Legal Counsel to the California Association of Marriage and Family Therapists (CAMFT) for approximately twenty-two years. He was director of Government Relations for CAMFT, and as such was the architect of CAMFT’s widely regarded and successful legislative agenda. He represented CAMFT before the regulatory board (the Board of Behavioral Sciences) and was a tireless advocate for due process and fairness for licensees and applicants. He was a regular presenter at workshops and was consistently evaluated as CAMFT’s most highly rated presenter. He also sat with the CAMFT Ethics Committee and acted as their advisor on matters pertaining to the enforcement of ethical standards. Richard is an acknowledged expert on matters pertaining to the interrelationship between law and the practice of marriage and family therapy and psychotherapy. For many years, he taught Law and Ethics courses for a number of colleges and universities in their marriage and family therapy degree programs. While at CAMFT, he provided telephone consultation services with thousands of therapists in California and elsewhere for over twenty years. He is highly regarded for his judgment, his expertise, his direct style, and his clarity. Richard has been the driving force for many of the changes and additions to the laws of the State of California that affect MFTs. In 1980, he was primarily responsible for achieving passage of the "Freedom of Choice Law" that required insurance companies to pay for psychotherapy services performed by MFTs. Passage of that law allowed MFTs to earn a living, allowed them to better compete in the marketplace, and strengthened the profession in California by leading to a great increase in the number of licensees and CAMFT membership. Currently, about half of the licensed marriage and family therapists in the country are licensed in California. While at CAMFT, Richard was primarily responsible for, among other things, the successful effort to criminalize sex between a patient and a therapist. He was successful in extending the laws of psychotherapist-patient privilege to MFTs, thereby giving patients the same level of privacy protection as when seeing a psychiatrist or psychologist. He fought tirelessly and successfully for the right of MFTs to refer to themselves as "psychotherapists," to perform psychological testing services, to be appropriately reimbursed by California’s Victims of Crime Program, and to be employed in county mental health agencies throughout California. Richard was admitted to the Bar in New York (1969) and in California (1973). While practicing in New York, he served as a public defender, and later, as an Assistant District Attorney. Shortly after moving to California, he worked for the San Diego County Human Relations Commission as their Law and Justice Officer. While there, he worked successfully to achieve greater racial diversity in the criminal jury selection system and to expose and stop police abuse. For such work with that agency, he was the recipient of the Civil Libertarian of the Year Award by the San Diego Chapter of the American Civil Liberties Union.

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