Billing in Psychotherapy Practices, Part 1
January 20, 2012
Adopting the use of billing software cured a huge headache in my office operations. When I first started in this business, bookkeeping and billing was all done by hand, believe it or not. I was lost in the fog of how things were done.
In my last therapy session of the month, Herb, my first therapist, would give me a hand written bill. It included my name, diagnosis, dates of sessions, charge per session, and the total balance due, neatly folded and tucked into an envelope with my name on its front. From this experience and “comparing notes” with other colleagues I developed my own bookkeeping and billing process.
It was cumbersome. I would copy each patient’s name from my Week-at-a-Glance calendar into a journal, a notebook containing a year’s worth of the daily list of patients, the charge for their visit, and any payment received that day. Toward the end of the month I would begin transcribing this information from the journal onto a ledger card for each patient. Before the patient’s final session of the month or the first visit of the following month I would produce a written statement containing the same information Herb put on mine. This went on for too many years to count.
My move to Chicago brought many changes to my life and business. One simple yet game changing one was adopting a computerized bookkeeping/billing solution. A Google search pointed to a host of options. Many were complicated, expensive practice management programs. I settled on ShrinkRapt by Saner Software. It is relatively inexpensive, easy to use, and produces simple yet complete billing statements.
Several years ago I spent many hours per month on these basic bookkeeping functions. Now it’s all efficiently handled by ShrinkRapt. It takes a few minutes to set up a new account. Entering charges and payments requires a mouse click or two. The remaining time consuming step is printing out, folding, stuffing into envelopes, and mailing the end of month statement for each client.
In part 2, I will address the evolution of my thinking about billing. How dramatically different it is now compared to what I did in the 1980’s and the even more drastic changes I am beginning to implement and how I am clearing the fog from all my business practices. Stay tuned.
In the meantime, what is your bookkeeping/billing philosophy and process? Let me know in the comment section below.