Financial Policies, Money Transference, and Nonpayment

There are many money issues in the patient/provider relationship that physicians need to be aware of and should address. Most practicing psychiatrists have had little actual training in business law, financial aspects of practice, or talking to patients about money. Instead, our knowledge has been gained in the field, by experience, or through thoughtful discussion with colleagues. Fortunately, medical school and psychiatric residencies are beginning to address the need for education in this area. The goal of this article is to further assist psychiatrists in tackling some of the more difficult financial issues in hopes of managing and reducing risk.

Establishment of a fee and policy sheet

Probably the single most valuable risk management technique for preventing money trouble is to present patients, at the start of treatment, with a fee and policy sheet. This should describe the charges for each type of service, policies involving payment (such as charging for no shows), and potential reasons for termination by the psychiatrist, including nonpayment.

There are many advantages to using a fee and policy sheet. Both psychiatrists and patients are loathe to discuss payment issues: for the psychiatrist it may be the fear of sounding mercenary; for the patient it may be the inability or unwillingness to pay, even though both understand it is required for treatment. The fee sheet initiates the dialogue, establishes payment as a legitimate matter for discussion, and sets a precedent for clear communication. As a result, subsequent talks about money become easier to broach for both parties.

Many psychiatrists who make the effort to discuss their fees or policies mistakenly do so on intake. However, most new patients are anxious at the onset of treatment, overwhelmed by information, and often too beleaguered to ask relevant questions. Fee sheets allow patients to review the information at home when they are more relaxed. While memories of discussions about policies and fees are subject to loss, distortion, and spin by both parties, the fee sheet remains available for review should there be a challenge.

Fee disclosure is also a necessary component of informed consent,^1-7 and patients who understand the cost of treatment can weigh their choices and plan accordingly. This is especially relevant when the choice is medication versus psychotherapy.

Finally, and possibly most importantly, creating a fee sheet forces psychiatrists to carefully consider monetary policies and choose those that best suit their practice and ethical inclinations. Having a fee sheet obligates practitioners to stick to their written policies. Without written guidelines, billing and payment procedures may drift over time or vary from patient to patient. Such inconsistency may be taken as evidence of boundary problems, mismanagement of the transference,⁸ or discriminatory treatment.

Since it is often included on the fee sheet, a short aside on charging for no shows may be in order. The majority of mental health care providers across all settings charge for both late cancellations and no shows, and in private practice, about 75% do so.⁹ In spite of this, some mental health care practitioners rightly question the principle of charging for services not rendered.¹⁰ Some states, like Arizona, have laws that prohibit charging patients when no service has been provided¹¹; some insurers, like Medicare, have similar policies. Before deciding on a billing policy for no shows, verify that it is allowed by state law, and ascertain which health insurance policies prohibit this practice and whether it is standard local practice.

Money transferences

Transference occurs when feelings, attitudes, or beliefs from past relationships are transferred to a present relationship.¹² Usually the phenomenon is unconscious, but parts of it, or the irrationality of it, may be within conscious awareness. Money transferences occur wherever money is a necessary component of the relationship, as it is in psychiatric treatment. Failure to resolve money transferences can lead to premature termination or nonpayment.

Money transferences create problems because the exchange of money for psychiatric treatment triggers a second relationship paralleling the treatment relationship. If the transference is mild to moderate in nature, it may simply affect payment. If the transference is intense, it may distort or disrupt the treatment. Since the exchange of money in psychiatric treatment only goes one way, the direction of the transference, whether from psychiatrist (countertransference) or patient (transference), strongly affects the content.

Armed with a fee sheet and written policies, a psychiatrist is better prepared to manage transference problems, particularly nonpayment. Without it, disputes or discussions get bogged down in what was or was not made clear to the patient or the psychiatrist. This is true for psychopharmacologists as well as psychotherapists, because money transferences disrupt both forms of treatment. The difference between the 2 types of practitioners is not what occurs, but the choice about whether and how to address it. Psychotherapists are mandated to address it as part of the treatment; psychopharmacologists have other options, including simple adherence to their policy without discussion or debate.

Prostitution/seduction transferences are among the most common money transferences and often occur when money is exchanged across gender lines. Clues that a prostitution transference may be at work include sexual overtones or associations to conversations about payment, small boundary violations, or the presentation of gifts. Prostitution transferences generally occur when money is given by a man to a woman, as is often the case in psychiatric treatment.

When a male patient pays a female psychiatrist, he is aware that he is "buying her services," and in fantasy, these services may extend to more than psychotherapy. If he feels good about the psychiatrist (positive transference), he may feel closer to her; if negative, he may feel she is not "putting out."

A female psychiatrist with a negative prostitution countertransference (triggered by the male patient's payment for her services) may inexplicably feel he is disgusting or demanding. She may wonder why he can't get what he needs elsewhere or begin to fear sexual assault. Conversely, if the woman psychiatrist enjoys her fantasized role of prostitute (positive countertransference), she may try to seduce him by exploiting his vulnerability, perhaps by keeping him in treatment beyond what is indicated so she can continue to collect his payment. Note that even if the sexual feelings are not mutual, the transference and countertransference may be mutually reinforcing.

Breaking the cycle of either positive or negative prostitution fantasies requires a return to reality. The provision of psychiatric services by a female psychiatrist to a paying male patient in no way represents prostitution. Her relationships, sexual and otherwise, occur outside of work, and she never engages in a sexual relationship with a patient. He, as the patient, can only buy psychiatric services. He may have problems in his relationships with women, but those will be treated through the psychotherapy process, not by engaging in sex with the therapist.

Prostitution transferences are occasionally triggered when male psychiatrists give female patients fee reductions. The woman may react negatively, feeling he is trying to buy her cooperation. She may wonder what else he wants from her or fear she owes him some kind of service. Conversely, if she is comfortable using her seductive abilities (positive transference), she may take a colluding stance in reaction to this "payment," thinking he finds her attractive and wondering what else she can do to keep the relationship going. On the countertransference side, the male psychiatrist may find himself having positive feelings about the fee reduction (the payment), hoping she'll do more work or put in more effort. Or he may have negative feelings about the fee reduction: that he had to "buy" her cooperation or that he's been tricked.

Early recognition of prostitution or seduction fantasies at the time of payment can provide an easy and often humorous segue into this minefield. Talking about it aloud quickly brings reality and consciousness to the fore, allowing discovery, insight, and learning to occur without the dangers of acting out unconscious sexual drives.

Nonpayment

Nonpayment can be addressed on 2 levels: first, on a concrete level as a breach of the patient-provider contract,¹³ and second, on a psychological level as resistance to treatment or the manifestation of a transference phenomenon. Payment is part of the treatment agreement, and because nonpayment breaches the contract, there is no legal duty to treat or continue to see patients who do not pay for services. On the other hand, fiduciary duties to patients are not contingent on payment.^4,8 Nonpayment does not give the psychiatrist permission to act unprofessionally, withhold records, or act in a way that might cause the patient harm.

It has been noted that the fee is an area in which a patient can really hurt or frustrate the psychiatrist.^14-16 Analyzing this expression of aggression can move the patient forward therapeutically. The psychiatrist must persuade the patient that understanding the psychology behind the nonpayment may forward his or her personal growth. The patient needs to see parallels to other behaviors or relationships¹⁷ and is guided to understanding nonpayment as a repetition of this pattern within the treatment relationship.

Sometimes nonpayment is a form of resistance to treatment. Nonpayment allows, and even compels, the patient to end treatment. When the psychiatrist suspects this motive, it should be interpreted quickly and directly by asking the patient if they desire, on some level, to leave or end treatment. If the patient drops out or is terminated without this interpretation, nonpayment may cause successive treatment failures, leaving the patient to believe, erroneously, that he or she is untreatable.

The most critical aspect of managing nonpayment is to confront it early, when only a small debt has accrued. If a patient's account is just overdue and the next visit is soon, bring it up at the beginning of the session and address any issues that come up, documenting both the problems and the plan in the progress note. Stick to your policies regarding fee reductions and discuss all the available options, including taking a break, decreasing the frequency of appointments, transfer to a less expensive provider, or treatment termination. If the patient's visit is a long time off, continue to send the overdue bill monthly, noting the aging of the account (eg, second notice, third notice, and so forth). Many patients will pay during this interim and problems with timeliness or affordability can be discussed during the next visit.

For patients who discontinue treatment leaving an unpaid bill, simply send a bill each month, again indicating the aging of the bill. In addition, it can be useful to include a request to call the office for a payment plan or if they are having problems paying. Determine the maximum number of billing cycles. This limit avoids undue harassment of the patient who can't or won't pay¹⁸ and facilitates moving on to the acceptance phase when no money is forthcoming. Remember that not all patients will pay their bill.

After attempts to resolve the payment issue have reached the limit on billing, the psychiatrist should end the treatment. There are 2 important requirements for terminating a patient for nonpayment. First, the patient cannot be in crisis or simply abandoned without notice.^8,19 Second, the termination must be done with care⁴ and communicated clearly to the patient. This can be done during a visit for active patients. For patients who have dropped out of treatment or remain incommunicado, a letter will suffice. Termination letters should mention the outstanding bill, lack of communication or action on the patient's part, and clearly state that the termination is occurring because of nonpayment. Include a copy of the termination letter in the patient's chart.

Concluding thoughts

Money and financial issues are an integral part of psychiatric treatment and should be addressed during clinical care. A few simple, preventive steps, open dialogue, and documentation can help minimize risk.

References:

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