Private Practice Billing Setup: 8 Decisions to Make Before Your First Client
Private practice billing setup is easier when you make the big decisions before your first client. Which insurers will you accept? Who sends the claims? What happens when one is denied? Here are eight decisions to settle early, with notes on where to ask a CPA or attorney.
Why private practice billing setup comes first
Billing mistakes are cheapest to fix before the first claim. A short private practice billing setup plan prevents the common problems in billing mistakes therapists make. It also sets you up for the behavioral health revenue cycle.
8 best decisions for private practice billing setup
1. In network, out of network or both
Decide which insurers you will join and whether you will bill out of network. See in-network vs out-of-network credentialing and out-of-network billing for therapists.
2. Your business structure and tax ID
Talk to a CPA or attorney about your entity and tax ID. Your claims must match them.
3. Your NPI
Get your National Provider Identifier and keep your details consistent.
4. When to start credentialing
Start early, because each payer works on its own schedule. See credentialing for new therapists.
5. Your EHR and claim tools
Choose an EHR that submits claims and receives remittances. Compare billing software vs a billing service.
6. Your intake process
Collect insurance details, verify benefits and record cost-share before the first visit. See eligibility verification.
7. Your privacy basics
Set up HIPAA safeguards and sign business associate agreements with vendors. See HIPAA for billing and the HHS business associate guidance.
8. Who does the billing
Decide whether you will bill yourself or hand it off. Read how to outsource therapy billing and the hand-off checklist.
Private payers vs Medicare vs Medicaid
Private payers
Choose carefully. Each has its own contract, rates and rules.
Medicare
Medicare requires its own enrollment. See Medicare behavioral health billing.
Medicaid
Medicaid enrollment is run by each state and varies by state. See state billing guides.
Business advice goes to the right professionals
This guide covers billing operations only. For your entity, taxes and contracts, talk to a CPA, attorney or SBA advisor. See also the private practice management hub.
A simple private practice billing setup plan
Write down your payers, your NPI, your tools and your owner for each task. Revisit the plan after your first month of claims. A written private practice billing setup plan makes it easier to hand work to staff or a billing service later.
Keep your private practice billing setup simple at first. Start with a small number of payers, test your claims with a few clients and learn how each payer pays before you add more. Review the first claims closely, because early errors repeat. Ask your EHR vendor and clearinghouse for a short walkthrough so you know where to find rejections and remittances.
Key takeaways
Decide your network approach, NPI, credentialing start, tools, intake process, privacy safeguards and who does the billing. Settle your private practice billing setup before the first session.
Frequently asked questions
Do I need an NPI before I see clients?
If you bill insurance, yes. It appears on every claim.
Should I accept insurance from day one?
It depends on your goals and your market. Many practices start with a few payers.
When should I look for billing help?
Before the workload becomes a problem. Many owners plan for it from the start.
Who should I ask about my business structure?
A CPA or attorney, not a billing service.
Where MCM South Medical Billing Service Works
MCM South Medical Billing Service, LLC works with psychotherapists and psychiatrists in our ten currently served states: Georgia, Massachusetts, Connecticut, Texas, Florida, New York, Colorado, Tennessee, North Carolina and Illinois.
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