I have been presented with the opportunity to join a growing practice. After meeting with the lead clinician I have the feeling something is not right in terms of medical billing practices. I don’t know a lot about getting started in private practice from a business sense and I feel that I should trust my instincts and not become involved but I am so green I wonder if I am actually missing out on a opportunity. Here is the basis of my concern…the lead clinician is paneled with insurance companies that are now closed in our area to new providers.
She has offered to add new clinicians to her panel. While the clinicians are being considered for paneling under the group’s contract she will refer patients to the new clinician (so you have business getting started) and bill under her NPI until you are accepted. She will also refer clients to you from her insurance contracts which do not have group provisions and bill under her NPI and then charge you an administrative fee when she is reimbursed and cut you a check minus the fee.
I am not experienced enough to know if this is how group practices typically work or if she is receiving some hidden benefit from appointing herself as the administrator of fees for services. I have much to learn about the business end of psychotherapy but I don’t want my first experience to be one where I am taken advantage of or found liable for something when I was simply unaware.

Any insights you might have to offer are appreciated.



Credentialing Answer:

Dear Kara, trust your instincts!

By billing under his or her NPI number, the provider/employer is likely committing insurance fraud, which is very serious. That being said, no one can know everything about every contract–so I do not want to accuse someone of doing something highly illegal without fully understanding the situation. However, nearly every time I have encountered a situation like this the practice of one provider using their insurance credentialing to allow another provider to see clients/patients, and bill insurance for those services, constituted insurance fraud.

To get to the bottom of it, call the insurance companies in question and ask them! They will likely be very keen to know WHO the provider is who’s using his/her NPI number to obtain reimbursement for other providers’ services. To gauge whether your potential employer

a) has a super special arrangement with the insurance companies for medical billing,

b) is committing serious fraud and not realizing it, or

c) knows that he/she is committing fraud so serious that if (more like WHEN) insurance companies find out he/she will possibly lose his/her license and have huge penalties to pay,

I recommend telling the potential employer that you’re going to call the insurance companies and tell them what he’s doing–you know “just to check” and make sure it’s kosher. Then see how he/she responds 🙂
I feel your employer’s pain! The insurance credentialing process does take 3-4 months, and it is a real bummer for providers (and employers) to wait patiently through that lengthy process. Being able to legally do what your potential employer is describing would be awesome, and would really take the pressure of credentialing new providers for private practice. Personally, it would make life a lot easier at my practices!! 🙂

Good question! I hope my answer helped!


Counseling Private PracticeDr.  is CEO of Thriveworks, is Private Practice Consultant for the American Counseling Association, and Author of “How to Thrive In Counseling Private Practice.” Learn more at

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