Out of Network Billing in Private Practice
How to Create a Superbill
When I first started in private practice, I had never heard of out of network billing, let alone superbills! When I first heard a colleague mention superbills, it conjured up imagery of a scary giant receipt. And though superbills are rather thorough, they’re not scary once you know what’s involved. Superbills are the main ticket to out of network billing in private practice. In this article, I share with you everything you need to know about superbills so you’re set up for out of network billing in private practice.
What is Out of Network Billing?
…And does it involve applying to be on insurance panels?
When I started in private practice, I had never even heard of out of network billing. Here’s a quick breakdown of the differences between in-network billing and out of network billing in private practice:
In-Network Billing in Private Practice
In-network billing requires that a therapist is on a specific insurance panel in order to bill insurance directly for reimbursement of a session. Most often, insurance policies have the client pay a small copay to you for services, and you as the therapist need to bill insurance directly to receive the rest of the payment.
This is a beast of a topic to break down in detail in this article, but you can hear a bit more about insurance in my video: Insurance vs Cash Pay Private Practice | Pros and Cons of Each
As far as how in-network billing relates to superbills, superbills typically don’t apply to in-network billing. Instead, insurance panels require that therapists complete a CMS-1500 form. Here is a sample CMS-1500 claim form from the CMS website.
Out of Network Billing in Private Practice
In contrast, out of network billing offers a format for therapists who do not have a formal contract with an insurance panel to bill the insurance company. Rather than using the in-network system of having a client pay a small copay and leaving it to insurance to reimburse the therapist for the rest, the therapist charges their client the full fee out of pocket and the insurance panel reimburses the client directly.
Depending on the specific insurance policy, some policies do not offer any out of network benefits, while others offer nearly full coverage for out of network therapy sessions.
A key factor to making out of network billing work is the superbill. Instead of the CMS-1500 form, therapists must provide a superbill receipt in order for clients to receive any out of network benefits they qualify for from their insurance policy.
What is a Superbill?
So what the heck is a superbill? A superbill is a detailed itemized receipt that healthcare providers like us use to reflect the services we offer. These receipts are most often used to submit claims for reimbursement from third-party payers, like insurance companies.
Why does insurance make us fill out this giant receipt? Essentially, they’re trying to make sure you’re who you say you are and that you are indeed offering the services your client is claiming that you’re offering. Otherwise, anyone could ask their insurance for out of network reimbursement, even if they’re not receiving any healthcare services.
It’s a pretty sweet deal: you receive your full fee directly from your client, and it’s up to the client to work out reimbursement with their insurance. The only added work on your end is providing the superbill receipt.
How to Create a Superbill for Out of Network Billing
With a little bit of work, you can set up your superbill template. Once you have your template set, it takes nearly no time to fill it out once your client requests one for out of network billing.
Let’s break it down into the components you need to include on your superbill receipt:
Your basic information
- Name. Just your first and last name will do, plus your business name if you’re operating with a DBA or as an LLC.
- Address. If insurance companies decide to contact you, they tend to do so via snail mail. So be sure to include your mailing address for your client to receive reimbursement.
- Basic Contact Information. This includes your phone number and email address, if applicable.
Your professional information
- Tax ID number. Don’t know what your tax ID number is? If you haven’t applied for an EIN (Employer Identification Number) yet, now’s the time to do so. It’s super easy to apply and I have an entire video showing you how to do it: Do you Need an EIN in Private Practice?
- NPI number. Chances are, you already have an NPI number lying around somewhere. If you’re not sure exactly what happened to your NPI number, you can look it up here: NPI Number Lookup. Or if you need to apply for one, you can do so here: NPPES
- License number. This is your license or credentialing to practice psychotherapy in your jurisdiction. As an example for me, I list my psychologist license number through the California Board of Psychology to practice in the state of California.
Your client’s information
- Name. Be sure to include your client’s first and last name.
- ICD-10 code. Most insurance companies do require a diagnosis code in order to process any claims. New to the ICD-10? You can learn more about ICD-10 codes here: ICD-10 Codes
- Your client’s date of birth.
An itemized list of services
- Date of service. This is the date you met with your client.
- CPT code. The CPT code represents the type of service you rendered to your client. Some insurance companies will cover some formats of service while not covering others, so this is important to reflect accurately. You can find a list of CPT codes relevant to our field here: CPT Codes for Psychology Services.
- Description of service. This is just the name of the service you offered affiliated with your CPT code. For example, if the CPT code you billed is “90834,” then the description of service will be “Individual Psychotherapy.”
- Cost of service. This is how much you charged your client for the CPT code you’re billing. This helps insurance know how much to reimburse according to your client’s coverage.
You can include several sessions in the same superbill receipt using a list format. I’ll show you later what that looks like.
Place of service code
This one can be confusing. The place of service is NOT your physical address, but rather the type of location you meet with your client. If you exclusively meet with clients face to face in your office, then you will use code “11” for the place of service. Here is a complete list of place of service codes: Place of Service Codes.
For the purposes of private practice, the three most common service codes therapists are likely to bill are “11” (office), “12” (in-home services), and “2” (telehealth). Be sure to still look through the list though as you may work in a different context reflected on this list.
A statement that the client has already paid the balance in full
I didn’t use to put this on my superbill, until one time my client’s insurance company sent me a check for the services my client already paid me for. Oopsies! So this is just a precaution to ensure the check goes to the right place.
Lastly, I sign and date the superbill.
When to Apply Out of Network Billing
Often clients are not aware that they may qualify for out-of-network benefits, so I always cover this when going over payment options during the initial phone screen. Sometimes clients have been surprised to find that their insurance will cover most of the cost!
Ultimately, it’s up to the client whether they wish to apply out of network benefits. Some clients have out of network coverage available in their policy but they still opt not to apply them for various reasons.
As far as frequency, many therapists offer superbills at the end of every month, others every session. You can decide on a reasonable frequency that fits you and your practice.
Once you pass the superbill to the client, it’s up to them to coordinate with their insurance to ask about how they submit for reimbursement. Your work is done!
Free Superbill Template
Everyone has their own formatting for their superbill. If you’d like to borrow mine as a template, you can snag it for free here: Swipe my complete Superbill template!
Superbills are a quick and easy way to make care more accessible to your clients while also allowing you to receive your full fee. It’s definitely worth considering offering them to clients you’re seeing in your practice.
Curious about additional options to receive your full fee while making therapy more affordable for your clients? You may be interested in learning about charging HSA accounts. You can learn everything about charging HSA accounts in my article: Accept Health Savings Accounts in Private Practice
Until next time, from one therapist to another: I wish you well!