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.

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.

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.