Jeff Guenther on Dec 02, 2018
I recently came across this article about how difficult it is for people to find low cost counseling services in San Francisco. It highlights how expensive therapy is and how out of reach it becomes for people that aren’t making a lot of money or don’t have insurance that covers mental health services. After talking to a number of therapists in the Bay Area, they all agreed that therapy is too costly for the average person. Therapists in private practice get to set their rate at whatever they want. They have the choice to charge as much as the market can bear or slide as low as they possibly can to serve more people in need. Even though they have the freedom to set their own price, they often can’t go very low due to the high cost of living in the Bay Area. Almost all of the counselors I spoke to expressed the desire to charge less money, but none were in a position where they really could. Therapists wouldn’t be able to keep the lights on if they charged a low fee ($60 per session) for all their clients.
If you’re not a therapist, you may be wondering why anyone would pay for mental health services out of pocket and not choose to use their insurance benefits. Good question. As a therapist, I can answer that pretty easily. Insurance companies get to decide how much they pay therapists per session. Some insurance companies pay a decent fee of around $100. But many insurance providers pay much less than that. Getting paid around $60 a session from an insurance provider is not uncommon. And trying to make a living on such a low reimbursement rate in a city like San Francisco, Los Angeles or New York makes it close to impossible to survive. So in order for therapists to make a living, they can’t accept insurance companies’ low payments and need to charge higher out of pocket fees.
Real quick, for the non-therapists, $60 an hour may sound like a decent living. And it would be if there weren’t any overhead costs. Therapists run their own small businesses. They need to pay for office space, which is crazy expensive in big cities, business insurance, continuing education fees, marketing costs, supervision, licensing dues, business supplies and a host of other things. Not to mention that a full time therapy practice has a caseload of 20 to 30 clients a week. No therapist out there is seeing 40 clients a week. There are too many other things we need to do in between clients in order to provide high quality care.
This high fee dilemma got me wondering how much therapists in different parts of the country charge. Luckily, I have access to data on therapist fees across the country. I am the co-creator of TherapyDen, a national therapist directory with a mandate to fight racism, homophobia, transphobia and other forms of discrimination. (If you’re a therapist you should definitely sign up for a profile. It’s free during launch, attracts ideal clients and allows me to write interesting articles like this). TherapyDen asks therapists to enter their standard out of pocket fees and their lowest sliding scale fee. A sliding scale is how low a therapist is willing to charge per session to meet the needs of lower income clients who are paying out of pocket (without insurance). Therapists rarely charge this lower fee for all of their sessions and instead will typically hold only a handful of spots in their caseload for sliding scale clients.
So let’s break down the data and see if we can learn anything interesting…
I collected data from cities that had at least 25 therapists with profiles on TherapyDen. Most of the cities had at least 50 therapists. TherapyDen launched just six months ago and is still growing. So while I’d like to have more therapists in each city, I thought that this was a good amount of counselors per city to get a solid understanding of average fees. There are therapists signed up for TherapyDen all over the country. But the cities that made the cut for this study are:
With over a thousand therapists signed up for a profile with TherapyDen (again if you’re a therapist you should join all the other cool therapists and sign up now while it’s free), I was able to gain insight into the average amount that is charged. As a reminder, when therapists create a profile, they choose a low fee that they can slide down to for clients that can’t pay their standard fee. And they choose a high fee that represents their standard fee.
Low fee: $112
High fee: $157
Percentage of therapists that charge $60 or less: 13%
Is that higher than you expected or does that seem about right? I’m a therapist in Portland, Oregon. And as you’ll find out in a moment, that seemed high to me. I’m used to seeing fees lower than that where I live. But that has a lot to do with cost of living in Oregon. While our cost of living has been on the rise over the last few years, we are still lower than most of the bigger cities across the country.
I chose to include the percentage of therapists that charge $60 or less per session because $60 is one of the most popular fees that therapy seekers choose when they are searching TherapyDen for a therapist on a budget. It also helps us get sense of how many therapists in a city are able to charge that little and still be in practice. Of all the therapists on TherapyDen, only 13% charge $60 or less for their low fee.
City Low Fee High Fee % Charging $60 or Less
Portland, OR $93 $130 26%
Denver, CO $92 $146 17%
Austin, TX $94 $139 22%
Charlotte, NC $105 $150 17%
Seattle, WA $106 $145 3%
Houston, TX $113 $151 6%
Oakland, CA $119 $154 4%
Chicago, IL $123 $178 9%
Los Angeles, CA $130 $187 5%
San Diego, CA $139 $167 8%
New York, NY $140 $201 0%
San Francisco, CA $142 $185 1%
Berkeley, CA $149 $174 0%
National Average $112 $156 13%
*Check out the interactive infographics below*
Basically, the higher the cost of living, the more expensive therapy needs to be in order for therapists to stay in business and the more out of reach it is going to be for lower income individuals. Because insurance companies are not paying therapists as much as they pay other medical professionals, therapy becomes even harder to access for people that live in big cities. What can therapists do about this? Sadly, not much. In my opinion, it’s not fair to put the pressure on them to lower prices. They simply can’t do that if they want to survive financially. Therapists can try to team up and force insurance companies to pay more. And they are! Therapists across the country are creating Individual Practice Associations where members join forces and try to negotiate better rates with insurance companies. This is something that doctors and dentists have been doing for years. But it’s incredibly difficult and takes a ton of time and money. And because therapists just don’t have as much power as the insurance companies the vast majority of the time it’s a losing battle.
Maybe the answer is that everyone should move to Portland, Austin and Denver in order to find a therapist that is affordable. Well, everyone is already moving to those places and it’s not just for the mental health benefits, so I wouldn’t want to encourage even more people to make the trek :)
I wish I could end this article with an uplifting message or an answer that would solve the problem of therapy being financially out of reach for many people in big cities. But there is no simple answer. The only real solution is to get insurance companies to pay a competitive rate. And to make sure that everyone has access to affordable insurance that includes quality mental health benefits. I’m afraid that until the needle moves on those variables, we’ll continue to face this situation. Until then, therapy will be something that only the privileged can afford on a regular basis.
If you haven’t already heard, TherapyDen is a therapist directory that has a mandate to help connect the disenfranchised and communities that are underserved to mental health care. So if you are a therapist that has a generous sliding scale fee, please sign up for a profile with TherapyDen. And if you’re a therapist that isn’t able to offer a low sliding scale, I totally get it. You need to make a living. I hope that you’ll sign up with TherapyDen too so that we can continue to grow and expand our reach for all populations.
Jeff Guenther, LPC, is a therapist in Portland, OR. He has been in private practice since 2005. Jeff is the creator and owner of Portland Therapy Center, a highly ranked therapist directory. Jeff, and his team, have launched a new progressive therapist directory, TherapyDen.