Fees and Collections

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Avoiding Liability Bulletin – May 2015

In what manner and to what extent are fees regulated in the state in which you practice? States usually require that the patient be informed of the fees to be charged, or the basis upon which the fee will be determined, prior to the commencement of therapy. Additionally, most state laws will contain some restrictions on advertising by health professionals, usually focused on preventing and/or making it a crime to engage in false, misleading, fraudulent, or deceptive advertising. Certain marketing practices and the use of certain words in advertising may be specifically proscribed, but beyond that, there may not be much regulation of the manner in which practitioners may establish fees – both as to the amount and the time frame or manner in which the fees are to be paid. Professional associations usually have little to say about fee arrangements because of antitrust concerns.

I recently experienced that orthodontists often collect the entire amount (thousands of dollars) to be charged for specified services in advance of work to be performed over a period of two years or more. Additionally, “professional discounts” or “courtesies” of several hundred dollars are provided for those patients who pay the entire bill at the outset of treatment. Some patients may put one-third or one-half down as an initial payment, resulting in a fixed monthly amount over the next two years (the anticipated course of treatment). Only certain patients are allowed to pay monthly as treatment progresses, with no down payment being required. The California Dental Board does not regulate this manner of charging fees, does not require any specific content in written agreements, and leaves any future dispute over fees to resolution by the parties and, if necessary, by a court.

Are mental health professionals in your state permitted to charge and collect fees, in advance, for professional services to be rendered in the future (to individuals, couples, families, or groups) in a manner similar to the above? Does the law in your state proscribe certain marketing or contracting practices, or the use in advertising of certain words and phrases, with respect to fees? Should there be more state regulation with respect to “boutique” fee arrangements in order to protect consumers?

Whatever the fee agreement is, there should be evidence (e.g., documentation) that the patient was fully and accurately informed of the arrangement in advance of the commencement of treatment. Common sense, good business judgment, and ethical behavior (e.g., avoiding exploitation) by the practitioner will help to limit problems. A written agreement, where the terms and conditions of the fee arrangement are clearly and fully spelled out, can also help to avoid a future dispute.

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Richard Leslie

"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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