Starting Your Own Private Psychiatry Practice: Q&A with Jennie Byrne, MD, PhD

TCPR: Can you explain this model?

Dr. Byrne: Sure. We tell patients we are an out-of-network provider, which means that they pay us in full at the time of the appointment. But if they want to, we will take their insurance information and electronically send their claims to their insurance company for them. It has to go through a third party—what is referred to as a “scrubbing system”—to make sure that it will be accepted. If so, then insurance will receive the claim and apply the amount to the deductible. After the deductible is met, they will pay a percentage of that claim back to the patient. It does not come to us.

TCPR: The third-party scrubber—what does that mean exactly?

Dr. Byrne: Again, when you’re thinking about a practice, you’re going to have to think about your electronic medical record (EMR). I don’t think anyone should be on paper, in my opinion. There are free ones that are perfectly good. When you get your EMR, one of the things to look at is the billing component. Ours is integrated into the EMR so that it is fully integrated into one system. Insurance will pay the deductible if you process it electronically with a third-party scrubber. If you are trying to do it manually, maybe only 25% or so will go through because insurance will invent all sorts of reasons to reject claims, oftentimes saying they were coded incorrectly or something like that.

TCPR: You bring up a point that I think a lot of us haven’t really thought about, which is that it might be easier to bill as an out-of-network provider if you use EMR.

Dr. Byrne: Right. Again, going back to the business component, if you’re going to have a small business, you want to have customer satisfaction. Obviously a high level of clinical care is one kind of satisfaction, but there are other kinds too, and the ease of use of your submitting claims for them—people do really like that.

TCPR: So imagine a patient comes to see you and says, “Dr. Byrne, I understand that you have this system in your practice where you will try to bill the insurance company. How does that work, and am I really going to get money back?” What do you tell them?

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Dr. Byrne: I would generally say something like this: “Once you hit your deductible, you’re going to get some money back; the percentage will depend on your plan. Our administrative staff can take your insurance information and help you estimate what your deductible will be.”

TCPR: And that deductible, does that include all healthcare spending that they might have, or is it just out-of-network outpatient visits?

Dr. Byrne: Typically insurance companies have an in-network deductible and an out-of-network deductible, as well as individual deductible and a family deductible, so the level of complexity obviously is growing. For our practice, patients would have to look up their out-of-network deductibles.

TCPR: In your experience, what’s an average out-of-network deductible?

Dr. Byrne: I’d say the average is 1,500 dollars, and whether patients meet that depends on how many visits they have with you. If they’re coming regularly for therapy, they’re going to hit that deductible pretty quickly. If they’re coming in quarterly for just stable med management (and we require a quarterly check-in), they’re probably not going to hit it.

TCPR: So if we decide to go the out-of-network route, do you have any suggestions for how much we should charge and how to determine that? Obviously we can look up people’s practice fees on the Internet, but it’s not as simple as that.

Dr. Byrne: When I first started, I looked around and talked to other practitioners, and what I found was that people were charging fees that varied widely. So I developed my own approach, which is one I use in my consulting work with new practices. The idea is to design a sustainable practice that is not going to cause you to burn out and overload yourself, because that’s what doctors tend to do. Only you can answer the question, “What do I need to make to feel good about what I’m doing?” So start with how many hours you want to work a week and decide how much money you need to make. And working backwards from there, come up with an hourly rate for your services. You also need to figure out what your administrative overhead might look like and how many hours your staff would need to work as well. You base your fees on time, much like a lawyer does. Your time is the critical component; instead of the patient receiving a service, what they’re getting is time with the doctor. So everything you do with patients is built on a time model.

Starting Your Own Private Psychiatry Practice: Q&A with Jennie Byrne, MD, PhD

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This article was published in print February 2016 in Volume:Issue 14:2.

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APA Reference
Psychiatry Report, T. (2017). Starting Your Own Private Psychiatry Practice: Q&A with Jennie Byrne, MD, PhD. Psych Central. Retrieved on August 10, 2020, from


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Last updated: 10 Apr 2017
Last reviewed: By John M. Grohol, Psy.D. on 10 Apr 2017
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