Private Pay 2: Joe Sanok’s Experience with Transitioning to a Fee-Based Service
This is Episode 2 of The Therapist Experience Mini-Series on becoming a cash based practice. Each episode is an interview with an industry leader and chock-full of advice and guidance on how to transition to a cash-based private practice.
You can access all other episodes in the Private Pay Mini-Series here.
In Episode 2 of Brighter Vision’s Mini-Series on becoming a cash based practice, we interview Joe Sanok from Practice of the Practice about his personal experience of transitioning off insurance panels and becoming 100% private pay.
Hint: It needs to be a smooth transition, not a cliff you jump off of.
Joe Sanok is a speaker, mental health counselor, business consultant, and podcaster.
Joe has the #1 podcast for counselors, The Practice of the Practice Podcast. With interviews with Pat Flynn, John Lee Dumas, Chris Ducker, Rob Bell, Glennon Doyle Melton, and Lewis Howes, Joe is a rising star in the speaking world! Joe is a writer for PsychCentral, has been featured on the Huffington Post, Reader’s Digest, Bustle, and Yahoo News. He is a keynote speaker, author of five books, and is a top-consultant.
You can find out more about him and what he’s up to at the sites below:
Thanks to Joe for joining me this week. Until next time!
You can access all other episodes in the Private Pay Mini-Series here.
TranscriptClick here to read the Transcript
Joe: I am doing great Perry, I’m so excited to be here. Thanks for having me on.
Perry: My pleasure. As I said to you before, I’m a little antsy here. I’m a little intimidated being on the other side of the microphone from you so, we’re going to have alot of though you have so much great advice and expertise to share and thank you so much for coming on today.
Joe: Oh yeah, anytime. I love the work you’re doing.
Perry: So for those who’s not familiar with Joe, let me give you a little introduction to him. Joe Sanok is a speaker, mental health counselor, business consultant and podcaster. Joe has the #1 podcast for counselors, The Practice of the Practice Podcast. With interviews with Pat Flynn, John Lee Dumas, Chris Ducker, Rob Bell, Glennon Doyle Melton, and Lewis Howes, Joe is a rising star in the speaking world! Joe is a writer for PsychCentral, has been featured on the Huffington Post, Reader’s Digest, Bustle, and Yahoo News. He is a keynote speaker, author of five books, and is a top-consultant in the therapy industry. Joe, thank you so much for being here man.
Joe: Yeah, this is going to be awesome.
Perry: Yeah, so Joe, why don’t you tell our audience a little more about your background? How’ll long you’ve been in practice? What do you focus on and a little bit about your business?
Joe: Yeah, so I have business called Mental Wellness Counseling in Traverse City, Michigan and this year we’re up 10 clinicians and then we actually thin that out a bit and so we have five really active clinicians and it’s an entirely cash-based private practice here in Traverse City and then the other side of what I do is practice of the practice where I help people to plan, start and grow private practices
Perry: Wow, so you were up to 10 clinicians and thinned out to just 5, why is that?
Joe: Yeah, you know what interesting is that we were up to 10 and I was thinking , you know I got some people that were kind of moonlighting doing like 10 sessions a week or fewer and inside I was like, “I would rather have less people that are doing more sessions, just cause from a management standpoint, it’s like if someone is doing five sessions a week, I think is nice to have that money come in but then everybody feels like they have an equal say but really in my mind they didn’t , like the person that’s doing thirty sessions a week, to me that person is really invested whereas someone who has a full time job and is just gonna part-time here is, it was kind of annoying honestly from a management standpoint and what happened was I didn’t have to let anybody go, it just like naturally thin itself, one lady moved to Tuscan, another lady moved to Detroit. someone else just decided they wanted to downsize , another lady got married and said , “I just wanna like take 8 months off as a sabbatical and just like be married and kind of see how that is”, and it worked itself out in a way that I didn’t have to be the bad guy.
Perry: That’s a nice way of working out for you there, that’s great and so, you have five full time clinicians working and you’re entirely cash-based?
Joe: Correct. Yeah, so in 2009 when I moved back to Traverse City from Kalamazoo, I tried to get onto insurance panels and lucky, they were all full and nobody wanted me and I wanted to start a part-time private practice in addition to my full time job, just to pay off student loan debt and I got it going, got my website up and said, I’m gonna just to open my doors,” and slowly got a handful of people and at that time , my goal literally was to pay off student loan debt. It wasn’t to build some empire off private practice that was something that was on my radar but I didn’t necessarily have that as an immediate goal and then things just kept taking off and we can talk about how I structured pay and how I talk about that but then I added a clinician after about a year and while I was still at my full- time job, I had three clinicians working for me so, I was making more outside of my full-time job working ten hours a week than I was in my 40 hour week job and that’s when I clearly had to say, “What am I doing here?”
Perry: So did you ever try again to get back on insurance panels or you just sort of put that in the revere mirror and never looked back.
Joe: Yeah, so I had been on insurance panels when I was down in Kalamazoo working as 1099 contractor and I can talk about what experience was like but by the insurance panels opened up, I was probably 6 months or a year after I had opened the practice. I was a full as I wanted to be; was raising my rates on a regular basis; was getting paid more than what the insurance panels were paying and I just decided that I’m even going to apply, they actually reached out and I’m like,” sorry, not going to do it.”
Perry: That must have been so gratifying after having to deal with insurance panels in Kalamazoo and just to say, “oh, nope, sorry, don’t need you guys.”
Joe: Yeah, I mean, there was a certain sense of not gonna lie, there was some pride there for sure.
Perry: so what was the experience like being a 1099 on insurance panels in Kalamazoo? Did you enjoy the experience? Tell our audience about that?
Joe: Yeah. So I worked for Dr. Larry Beer who has one of the largest practices in the nation. He often speaks at the American psychological association about super-sized private practices and it’s just an incredible practice and so, he’s amazing, he has an insurance based practice there and he coached me the best that he could but what I found really tough especially earlier in my career was I had to market to find new clients but then often as people would call and I wasn’t in a certain insurance panel then I had refer them someplace else .All this time getting the clients only to say, “Sorry, I don’t take insurance,” or on the other side, I would spend all this time getting onto insurance panels only to be like,” Where are these people in our town?” Like should I do it with the big ones, just the big two or three, should I try get on all the little ones , go through CAQH, through all that stuff and for me , the amount of time that I spent dealing with insurance wasn’t worth ever. I remember one insurance in a particular, I got 53$ dollars per session which as someone, a couple years out of Grad School with business taking a percentage of that was still a decent hourly for me but they would only authorize three sessions so 159$ for those 3 sessions. I would spend at least an hour sending in paperwork, working for those authorizations. I’m getting paid for something that I’d already done. I would then have to wait 30-45 days for the check and usually that client would no show, one of those three sessions which wasn’t available Now, I got five hours in for 160$ bucks or so I could then, keep that model or I could just charge 160$ bucks and give 4 sessions away and come out exactly the same.
Perry: There’s alot of interesting stuff there. So, the 160$ dollars, seeing it and dealing with the insurance panels and all the paper work and all the headache and all the hassle but then they only approve three sessions so then, that means that every new patient is only worth 160$ dollars. Their entire lifetime value. Is that correct?
Joe: Well, they were only approve three at the beginning and then we had to come back and kinda say, why do I want five more? And so, then they would do it in blocks of five but every time, there was someone that wasn’t a clinician, it was saying, “Well, why does this person still need therapy?” You barely have an Associate’s degree, you’re just reading off a script and you are trying to find ways to not give people coverage, like this is not what I went to school for, when it comes to helping people.
Perry: And so then you moved from Kalamazoo to Traverse City and you said, “Alright, I’m not gonna be on these insurance panels, they don’t have room for me. Let’s just open a practice and let’s just be cash-based.” You said that you started to fill out very quickly, what rate did you start at?
Joe: Yeah. What I did is that I look at what the market rate was for our area for private pay and at that time it was 80$ dollars per session so I though well, i will just go 10$ dollars a session underneath which I actually wouldn’t recommend right now. I think that for my level of experience at that time if I was consulting with 2009 Joe Sanok, I would say, “you’re fully licensed, you have a bunch of experience. You’ve been featured in a lot of different things, I would actually say, go above the market rate so you build your value especially you have a full-time job for people that are doing kind of a part -time practice, you really want to make it worth it for you to go in and do the practice and so I would, I should have probably start around 120$ but I started at 70$ bucks a session.
Perry: So you started at 70$ bucks a session, started to fill your practice pretty rapidly. Do you think that the people who started seeing you- do you think that you were able to build your practice so quickly impart because you started with a lower rate?
Joe: I think that was definitely apart of it for some of my clients but when you think about the type of person that can pay out of pocket, typically, they have the money, no matter what you charge and I mean, of course, there’s an upper level to that but I do think that the people that are gonna choose private pay, they are gonna choose it for a few different reasons. They don’t want their insurance to know that they are in counseling. They don’t want a formal mental health diagnosis. They don’t want their kid to have a formal mental health diagnosis. They may be in a career where that could affect their career for some reason, there’s a HEPA violation and somebody found out about their diagnosis. Also, they just want to be in charge of their records. They want to be 100% in charge of it so they may use HSA or a flexible spending account to pay for that and for a lot of people, that’s really important especially with-I mean , if the DNC can get hacked, a lot of things can get out there hacked, nothing against the great providers out there that provide the HEPA management systems or EMRs but for me having a private pay practice, the paperwork is literally locked in a cabinet and not online was actually something that I used as a selling point to say that we’re over the top confidential and let me tell you why.
Perry: Do you think that in your consultant work, do you see that the selling point that being over the top confidential as being an asset across the country to help sell your services?
Joe: I think being over the top confidential can be an asset but what looks like to each person or each clinician and clinic is going to look a little bit different. So, if it’s that you want electronic medical record or you want electronic scheduling or those sorts of things, making sure that you have the top products that out there, that are both user friendly and also hit the compliance so it could be something like simple practice and looking at what people like Roy Huggins are writing about HEPA, making sure that you are up-to-date on all the ways that people can get hacked is really important and then use that as a selling point to say that you’re over the top confidential. What differentiates you from just a regular clinician that the insurance says, “Sure, you can go see these 10 people.”
Perry: So Joe, you have taste for selling You understand whether that can be acquired over a time as a skill or it wan innate in you, I don’t know 2009 Joe but a lot of people, a lot of therapist find selling really hard and that’s got to be the most challenging part about being a cash-based private practice because you do need to sell yourself more. You don’t-you’re not on an insurance panel. You’re not getting a referrals from the insurance network. You have tell someone, hey, you know, you have to pay me cash for my services. What would you recommend to people who are transitioning to a private pay private practice? What would recommend to them in advising guidance on learning how to sell yourself?
Joe: Yeah, so I’d definitely say selling is not innate to me. The summer going into College , it was my senior of High School, the summer going into college. I sold Kirby’s vacuum cleaner door to door and so, I’d literally would carry a vacuum cleaner up to someone door and try to get in there to demonstrate it for them to sell them this 2000$ dollars vacuum cleaner. I’d sold two and a half.
Perry: A half?
Joe: Yes. I sold one to my parents. My parents friends wanted a demonstration and bought one and then I got so bored with going to door by myself, I got a friend of mine to go with me and I said, ” Literally, I just want the company, I’ll give you half the profits if you come,” and that was one that we actually sold. We sold one to this couple that really needed it but for me marketing a 2000$ dollar vacuum cleaner was the worst thing in the world for me. The product was good but I didn’t believe in it, it wasn’t a life passion and so that’s where I think a lot feel when it comes to our private practices but the big difference is in selling your private practice is you have believe in your work. I believe that we have some of the best clinicians in Traverse City that we are the premiere practice for premier people here in Traverse City and so when I speak to why my expertise is different. You know, I went through Gottman’s level one recently and so I’m incorporating that in my couples work. As well, I have Steve Greenman who writes the best substance abuse assessment in 5 county area. the judges, the attorneys, the people that get the substance abuse assessments, they say that to us and so, if you are doing really good work, it’s a lot easier to market yourself because you just want to talk about the impact it’s having on people. The bottom line is that we have fast outcomes in our work here. We help people quicker. we help people make changes and we get see people life change really quickly because we have great clinicians here and so, when that’s the case, that passion comes out versus selling a Kirby vacuum cleaner door to door.
Perry: That’s phenomenal. I had no idea that you guys had five, previously ten clinicians working at your practice. That’s so impressive and so amazing to see and the work you’re doing, like you said, its great work, you’re seeing the outcomes. You’re the premiere private practice in Traverse City but what about therapist who’s been on insurance for you know 4-5 years and is getting sick of doing all the paperwork and essentially being an employee of BlueCross, BlueShield, Aetna and United Healthcare. How do they begin understanding how to sell themselves and begin that transition and make that transition a success?
Joe: Yeah, I think the very first step is to identify who are the clients that you have enjoyed working with the most? Was it that one couple that they were dealing with a miscarriage and you were like, “That was amazing. I felt so good about that work. They felt so good about that work,” like create a business avatar of who you really enjoy working with. Just yesterday in our mastermind group, I help this one lady as a group we help her figure out who was her specialty and who does she love working with and you can find these unifying features. It doesn’t have to just be I’m gonna work with people dealing with an eating disorder or I’m gonna just help people that are dealing with divorce. Look at those clients that you enjoy working with and you have strong outcomes with and see what unifying features they are, maybe, they are all people that really value change and self-improvement and they also, maybe they are highly educated maybe they are type A people, what is the unifying feature? So, I start there with creating your business avatar, from there, really looking at how do you articulate the pain that the business avatar comes to you with in your practice and then the outcome, so, I help kids or I help parents who are getting too many phone from the principal to be able to have a clear plan for helping their students to be more successful in school so what’s that pain? I’m getting way too many phone calls from the principal. What the outcome? We’re going to have a plan for the behavior so that you can have more piece in your house. So you really want to say what’s that pain and what’s the outcome you get from that and then third, you want to think about once you’ve sketch out that business avatar, who’s connected to that person? Say, we have that couple, they have a middle school boy who the principal calls at least once a week because of some behavioral issue. Who is that Mom or who is that Dad gonna vent to about them? Like, are they gonna have a beer with somebody? Are they gonna talk to that pastor? Are they gonna go to a Facebook group and vent to other Moms or Dads, like, where are they gonna go vent? And if you can discover that; that’s the list of people that you need to be networking with that when someone is venting to them, they say, ” Oh my gosh, I know this guy in Traverse City , Michigan who works with angry teenagers name Joe Sanok. He’s the best. He’s got all these blog post about it. Yeah, if you google angry teenager, it’s going to show up and that’s where that process of knowing who you enjoy working and get the best outcomes. How do you quickly articulate their pain and the outcomes that you have in counseling and then who’s connected to that person. If you can go through that, you’re gonna find so many more clients because it’s gonna be that kind of authentic relationship that happens that people are naturally gonna say,” you know what, you need the best and here’s the best.”
Perry: Joe, this is exactly why we have you on here man. You know, that was so perfectly articulated. I’m sure that anyone listening to this, if you listen other podcast, you’ve read other marketing materials. You know, you create the avatar but you took it a step further and you started going in and talking about marketing and figuring out who this person is connected with and use the language, where do they vent? Who do they vent to? And finding that forum, that’s how you begin marketing yourself so, you’re creating that avatar. You’re figuring out who you want to work with and making that transition easier and then actually figuring out where they’re hanging out and who they are venting? I’ve never heard that language specifically used before and I think that it’s just so true. That’s how you’re gonna acquire those customers and start growing your practice. That’s how you’re gonna market yourself.
Joe: Well, it like, even recently-so a close friend of mine recently told that he’s been diagnose with diabetes. He knows that I’m type 1 diabetic so whose does he call? His friend who has diabetes and then I’m gonna share with him, here’s all the other things that I’ve learned from other people. Here’s an author. Here’s a podcast. Here’s the anti-inflammation things that’ll help, you know, eat a bunch of cinnamon, it helps with blood sugar, you know, you just think about it in your life, if you’re dealing with a pain or if your friends are dealing with a pain, they come to you and then come to you, you don’t just sit there and say, “Oh, I’m sorry, you have diabetes now”. No, you naturally say, “I’m sorry you have diabetes, that totally stinks, but there’s hope, let me tell you a couple things that have worked for me. If they work for you awesome, if they don’t, that’s fine too but as your friend, I’m not gonna hold back my information.” And so we naturally do this in our own lives anyway and so we just need to kind of be aware of when we need to make a big decision. How do we make that decision? When something goes wrong in our life? When our Mom or Dad is dealing with something, how do we make that decision and how do we end up purchasing something based on that pain and so it may be, I’m gonna but a blood pressure cuff for my Mom cause she’s dealing with high-blood pressure which she’s not but if she were I’d probably, if I had friend that dealt with that, I’d say, “which one is the best one.” Now, that’s some really authentic natural marketing that those blood pressure cuff companies have been able to do so we make these decisions every single day, we just have to be more aware of the nuisances of it and then take those out of everyday experiences and then apply it to our own practice.
Perry: That was great. So, I’d love to move on to some of the hesitation and the fear that you can feel when transitioning to a cash-based private practice. Do you see in all of your consultation work a fear that a therapist will say, you know, “I wanna be cash-based but I’m scared I’m gonna lose all my current clients.” How do you handle that? Do you see that as a reality and how do you address to your current clients?
Joe: Yeah, so I’ve helped probably, I don’t want to put an actual number on it but I’ve helped tons of people transition from an insurance practice to a private based practice and that fear is definitely the #1 fear so I’m really glad you’re asking that because there are some practices that doesn’t make sense to go 100% percent private pay. I had one consulting client that was in a really big military town and almost everyone had this one specific insurance if they were in the military and this person helped with PTSD so it really make sense for them and they had a passion for helping people in the military to keep that insurance but then evaluate other insurance if they were on and say, well maybe that doesn’t make sense. So, the first activity that I give my insurance clients is to list out all the insurances you’re and then first, in the next column, rank 1-10, who’s the easiest insurance to work and who’s the hardest insurance to work with. You know inside of you, there’s those insurances that their system is ridiculous. It’s a pain in the butt. They don’t pay you on time. There’s all these different factors so first just rank them like one through however many you have. Next, figure the exact amount you’re getting paid for each of them and then, maybe just assess your overall stress in regards to how many clients you have there on that or not. So you may have that’s really hard to work with but they pay really well and 80% percent of your clients are on that insurance so if you’re looking to transition to a private pay practice, that’s probably not the first insurance to start with, maybe, that’s going to be the one you drop last once you get alot of the basic marketing down but the one that’s pain to work with, they don’t pay you for 90 days. They’re the lowest paying and they are super stressful and you have two clients from there. That’s probably the one that you want to look at first. So first step would be definitely, you want to assess you insurance situation. Next, I would say, pick one or two those insurances to kinda step down from, I’d much rather see people take a graded than to see just say, “oh, I’m off insurance,” and then be like, why do I have no money? Well, because you didn’t do it in a way that’s gonna really reduce the amount of risk and so we want to make sure that this is smooth transition and not just like a cliff you jump off of and so start with one or two, go through the process so some insurances, I remember consulting with a client that she had started talking with me and our first session , I said, you need to at least look at of the policies in regards to renewing your contract with them right way,” and she didn’t and the day after our second consulting phone call, she did call all of here insurance companies and per her contract, her contract, automatically renewed and she couldn’t get out of it until a next year so she was stuck being on that insurance for the next year because of the contract, they just automatically renewed her on a certain date. You want to know what it takes to get off the insurances, some of them it’s a 30 day, some it’s a 90 day letter, some it’s an annual contract and there’s a set date so you just kind of want to have a spread sheet of if I want to leave all the insurances , what it’s going to take? Then you want to talk about, how is it, you’re gonna take to your clients? So you’ve decided that you’re gonna get off BlueCross, Aetna whatever one it is because of all those factors we talked about in step one and then you’re gonna say, “Well, how many of these clients do I have?” And you can do this in a few different ways; you can do it via email or you can do it in person in a session. Based on your schedule, I mean, if you’re not gonna see someone for a month ,maybe more of sort of like an oil change plan or they drop in once a month, that’s not going to be the person that you want until they come in your office. You really probably within a one week period of time want to let everybody know that’s on that insurance so that you know that you hit everyone so via email or in person and the way that conversation would go for me would be , Hey Perry-I would probably do this at the beginning of the session, I wouldn’t just drop as they are leaving, hey Perry, I love our work together and I want to continue that, however, as of this date, I’m no longer gonna be taking your insurance. I really the work we do together. There’s a couple factors in this of why I’m doing this such as having to give you a mental health diagnosis as well, I know that your co-pay is 2000$ per person which a lot people do have high co-pay so you’d be paying out of pocket for a number of these services on March 1st anyway and then I would them through , what does mean for you so in 2017, I’m happy to keep your rate at, you know, maybe you a little bit lower than your new clients, that’s what- you have to kind of have your clinical decision there cause you wanna have the therapeutic benefit continue to the best of your ability while also being able to make a living for yourself.
Perry: Do you recommend for existing clients negotiating at all your rate with them?
Joe: Not usually. However, every October, November, I send all of my private pay clients an email raising their rates. They’re just used to it if they have been with me for more than a year so on January 1, I get a raise every year. My cost always go up. Perry, your cost for your business always go up. Somehow, you kept your rates for websites down really which is amazing but I raise the rates every year and let them know, this is tome of year that you’re thinking about your insurance for next year. I know you’ve done out of pocket but you’re gonna want to look at your out of pocket reimbursements, your HSA, your flexible spending contribution id this affects your ability to do counseling with me, please let me know. When you start to get a private pay practice, you’re gonna get fewer and fewer of those people who push back at rates, so I would say in general, you don’t need to negotiate. Once in a while, there are unique situations that I’d want to leave clinical judgement for people to decide but as a general rule of thumb, I’d say, probably not and I think also people respect you more when you keep a solid rate.
Perry: So, we’re talking about insurance, what Medicaid though? What if you’re seeing many Medicaid clients at the time that you’re transition to cash-based private practice?
Joe: Yeah, so that can get pretty complicated so Trevor City, for example, we have only have a handful of Medicaid providers and that’s really difficult in regards, if you have built a practice around Medicaid to transition to a transition to a private pay practice without losing those clients. They’re most likely not gonna have-I mean, if they have Medicaid, they’re most likely not gonna be able to afford services, so, that’s where you could use something like open path collective , that is a way that people would pay a one-time fee to be able to have access to clinicians for, I think is 30$-50$ dollars so you could use something like that to monitor how many people that you’re gonna take at a sliding fee, maybe there’s clients that you decide that you’re gonna use a lower rate because of their situation. For us here at Mental Wellness Counseling, we have agreements with agencies in town. For example, there’s single mom ministries, there’s Bethany Family services and a few other agencies and if they make a referral to us; we trust their judgement and what that person can pay. Bethany has state contract where they can only get reimburse at the State rate which is about 1/3 of what we typically get paid but for us, kids often times don’t have access to quality clinicians and we want then to have access to it. So each clinic can then decide , how many private pay people do I want, include that in your numbers and then from there you know, okay , I can have three private pay people that are on a sliding fee scale and it not gonna affect my overall bottom line.
Perry: What are some of the common pitfalls that you see therapist making as they transition to a private pay practice?
Joe: I think based off what we just talked about, a fear of raising their rates. I think this a really big fear. I usually raise my rates a few times a year for new intakes.
Perry: A few times a year?
Joe: So, it’s not for current clients. It’s not like a client comes in at one rate and all year, they’re like, great, I gotta pay 20$ bucks more per session but I continually kind of push the boundaries of what I can charge for my counseling and as you have fewer, it’s a lot easier to do that and I found that as I raise my rates, I actually get more people and more people that have a certain affluence that want to come because they think the expertise is higher because of that rate. I do think its higher but there’s also that perception of something being worth more because you’re paying more and then people do more work because then people are like, Dang, I need to put in the time if I’m gonna spend all this money on counseling.
Perry: Absolutely. Are you buying the Ford Torres or Subaru outback or are you buying the Mercedes. All three cars have their benefits but you know certain ones are gonna provide- are going to attract different types of clientele.
Joe: Absolutely and it gonna make you raise your game because if you’re gonna be charging twice or more than the going rate which right now I’m charging about three times the going rate for private pay practice-practices in Trevor City, there’s a certain expectation there, not that I always have to have the nicest office but we found a great office in Downtown, Trevor City that has a corner view of the water. There’s a building going up right next to me and I’m actually watching them build the bricks that are gonna take away my view but you know, it’s a nice downtown office. We have a refrigerator that has Starbucks, Frappuccino, it has LaCroix, it has coconut water, it not like a bunch of soda pop that we’re telling people to stop drinking if they want to improve their mental health. We have a nice tea machine and so these things that are kind of extra add-ons that you give to people, it may cost you an extra dollar per person because you’re giving them a Starbucks every time but how much charge them because you’ve created this environment that feels like they’re really special when they come to your office.
Perry: People pay for experiences it’s a growing trend and you know, if you’re providing therapy and you’re charging certain rates, you have to provide that certain experience as well in addition to the great clinical that you do. I mean to be charging three times the growing rate. That’s wild.
Joe: It is, right.
Perry: Congratulations. Yeah, absolutely wild Joe.
Joe: Well, it’s been a process. I still remember the conversation that I had with my brother who I had at the time was doing business consulting in Chicago and I kind of in a bragging way said, “The practice is going great. I have this waiting list. It’s gonna take 2 months to get them in and he’s like, why do you have a waiting list?” Like, I expect him to be like, Congratulations and then in typical brotherly fashion, he like, “why do you have a waiting list?”
Perry: Older brother?
Joe: Younger but he’s very smart in the business world not that younger brother can’t be smart.
Perry: As an older brother. I can see that being an older brother thing to say, like, why do you have a waiting list?
Joe: Oh yeah. Right but in this situation at that time, his business expertise was so much farther pass mine and so he said, “when someone calls you counseling, they typically like to decide that minute , like yeah, I’m gonna call for counseling or have they thought about it for a while?” They probably though about for months if not years often times and so then they are going pick up that phone and it’s going to take a lot of courage and they your gonna say sorry, you can’t come in. That seems like a waste of your marketing assets. Why don’t you just raise your rates? And I was like Pete come on, like that just seems unethical to just charge them more and he’s like, “well, if someone called and said that I’ll pay you 1000$ dollars for 45 minutes,” would you do it? And I was like, well 500$ dollars for 45 minutes, I was like yeah. He’s like, so it not really unethical concern if they pay enough so it’s clearly that your number don’t align with what is going into that. So, how much will it be and so right away? I raised my rates and when I feel that like, wow, I’ve been way too busy to really provide the kind of work I want to do. I’ll tell my assistant, alright, the new rate is this and often times I even get more people but then it’s at a higher rate.
Perry: It’s really funny-in the software world, in the software business world you’re told to always be experimenting with you rates. Always be changing your prices and see what kind impact that has and you don’t really see that in the counselling world at all. A therapist might you know might raise their rate, you know 5%, 10% at year-end but not to adjust with the supply and demand of the current moment. So, are your rates published on your website?
Joe: They are published on my Psychology today profile and then on my website , we put the range of rates and so that’s the great thing about adding additional clinicians is if someone is like , you know what Joe, I would love to see but I just can’t afford you. I can say, you know, I have Steve that’s at this rate. I have Nicole that’s at this rate. Maryland is at this rate. That’s one of the great things about having extra people as part of your practice and even if you have a single office. You have plenty of extra time that you’re not in the office that you could have somebody else sublet. You can someone as a 1099 or W2 based on kinda your state employment law.
Joe: Which is whole another podcast episode.
Perry: I know, I want to ask you questions but I’m like, why don’t we save that for another one. So, what are thoughts about creating some innovation things, innovative materials to help attract private pay clients?
Joe: Yeah, so I think innovation is definitely the thing that sets most successful private pay practices apart from unsuccessful or struggling private pay practices. One thing that I id early on is I created a partnership with this restaurant in town where they would give me gift cards at a lower rate than what the gift cards were and then I had this thing called dinner and a counseling session and so it was a certain rate and they got this 50$ dollar gift card to go out to dinner. They didn’t know. The restaurant didn’t know that they were coming from me, like they didn’t mark them in a special way, I would just buy a bulk of them and so I got some great free press around this dinner and a counseling session thing. Like, what is this? You go out to dinner with these couples and I was like, “no”. They come to a counseling session and then would go out to dinner afterward serving like as a date to kind of put some animation into their relationship. So , those sorts of things , I think are so important and what I’ve observed is that our best ideas usually come when we’ve slowed down so when you’re in the shower and you’re just kind of letting your brain go all over the place or you’re on a long drive and you turn off the radio, that time when you slow yourself down enough, it’s like these great ideas have been sitting inside of you but they’ve just been covered up with all the stress and business and just like the basic things that takes to run a practice and we have to slow in order to let those great ideas come out to have those shower “ah ah” moments.
Perry: I need to take a clip of this and send it to my wife because I tell her , “I can’t take shorter showers, babe, like I’m sorry , I need that time to think and she’s like, yeah but we have two young kids and I don’t get to take that long of a shower and I’m like, take that long of a shower, slow down, take it,” but I need to take that clip and send it to her and say Brighter Vision will fail if I take slower showers or longer showers, I mean, not slower.
Joe: So, I don’t disagree with you but then it’s also-so I’ve continued to push the boundaries of scaling back and so right I work usually 3-3.5 days a week and so on Mondays and Fridays, I’m present for the family and so if I want those slow down moments , my wife is like, go for it cause you’re around for a 4 day weekend and so continuing to push yourself to be able to slow down to spark innovation to me is one of the most essential parts of just growing a private pay practice, that’s successful because you need to have those good ideas.. You need to have those multiple streams of income. You need to have a variety of things that you’re working on and also, having extreme focus which seems to kind of push against that idea of multiple ideas and when we slow down , to me that’s kind of one the essential bedrocks of building a successful practice.
Perry: How do you slow down? If you’re transitioning to a private pay practice, you know, you gotta get into the ball of things. You’re potentially losing clients because you’re not taking insurance panels anymore and there’s alot of stress and anxiety with that transition. How do you find that time to slow down?
Joe: So, I don’t think that it’s impossible. When I was working my full-time job 40 hours a week plus and then had my part-time private practice and the podcast and that probably was 15 hrs a week, So, I mean we’re talking 60 hours a week of work. There was certain kind of boundaries that I set so on Friday when I got home from work, I wouldn’t do any work email. I wouldn’t do anything that had to do with work. I wouldn’t listen to podcast until Sunday morning and so I would take this time to really purge all of the different just kinda- when we pull out our phones, we naturally go to our email or go to twitter or whatever we think is going to help us build our practice so I think the first step is really purging and then setting some boundaries and practices and when we have those practices, what it looks like is intentionally doing things that are gonna teach you to slow down and so every Saturday morning, I have the choice to sit and clean up Lego and toys and make our house better so that’s something that’s not necessarily moving the relationships forward or we can go out for a hike and sometimes you have to say no to having a clean house. Sometimes, you have to say no to certain things because you then you’re connecting with your family and you’re slowing down and so a purge that I practice usually when it naturally happens when you give yourself enough time and each person, it takes a little bit different amount of time and it’s kind of like a muscle that you build then you naturally move into this presence and that’s where the sparks and innovation really start to come out. You can start to do some clear goal-setting where you set, achieve and outsource goals and that again is whole another podcast episode too.
Perry: And you practice what you preach here. You have something called the slow-down school? Correct.
Perry: Can you elaborate on that for our audience?
Joe: Yeah. It’s funny. My wife and I were walking through the Detroit airport on our way to Asheville, to go to Brew your practice which Alison Puryear and Jane Carter and I put on and we were talking about these ideas like at first it just started as a joke like what if I put on conference where we had like coloring books and play dough and we were like slowing down and did all the stuff that we do to slow down and my wife is an introvert and like loves that and she’s like ,” that would be awesome,” so on that airplane ride down to Asheville in typical form Christina falls asleep and takes a nap and I sit down with my journal and I sketch out the entire thing and so as as i started to bouncing the idea of people, it really resonated with therapist because those that are introverted and need to recharge don’t have a conference that they could really genuinely recharge where they can stand a paddle board on Lake Michigan. They go for hikes. They can draw in coloring book and extroverts like me that seemingly have like unlimited energy, we need to have people teach us to reign it in. That’s been one of the most important lesson that I have learnt from wife is I need to reign it in. This is not sustainable if I just run full sprint all the time. I can sprint and then rest. Sprint and then rest. Sprint and then rest but if I go non-stop all the time , that’s not healthy either and so over at slowdownschool.com, that’s where you can get more information about the conference. I also have a 3 part video series that’s over on practiceofthepractice.com/slowdownvideo/. Cupla media has done amazing job-they do videos for therapist and they flew in and helped me to make this amazing video series to talk about not just the conference but ways to slow down and how I do my exact goal setting to set, achieve and outsource goals.
Perry: Awesome. Well Joe and to all of our audience listening, we will have links to all that in this week’s show notes at brightervison.com/privatepay2/. Joe, where can our audience hence follow you, learn more about you. Do you prefer Twitter, Facebook? What would you like?
Joe: Just head over to practiceofthepractice.com and from there you can find your favorite social media links to follow me there and feel free to connect with me. I’d love to chat.
Perry: Absolutely, well Joe, thank you so much for being on today. This was amazing and I hope that everybody listening has taken notes because this is just a great guide book on transition to a fee based service and how to do it from one of the best in the game.
Joe: Thanks so much Perry, this has been a lot of fun.
Perry: And for everyone listening, you can check out the rest of the min-series over at brightervison.com/privatepay1/. Thank you again for listening everyone and we will see you next week.