Becoming a private practice mental health professional is not hard to do. Becoming a successful private practice mental health professional — that’s another story! The key to success really depends only on three key things..

  • Marketing
  • Marketing
  • Unit Economics

Marketing.. and More Marketing

Marketing is so important, I included it twice. If you want to sell something, anything, people need to know about it, be convinced that they need it, and be convinced that you’re the right one to sell it to them.

What they didn’t teach you in school about marketing

If you are a behavioral health professional, it’s highly likely that you didn’t study marketing in college. If you did, it was likely a few survey-level courses to meet an undergraduate degree requirement, but it’s a fact that most psychology degree programs fail to prepare you for the challenges of running a business. Marketing is a huge topic, however, you’re in good hands here — in fact, I literally wrote the book on online marketing for therapists. Also, we’ve written a ton of posts about behavioral health marketing. So one of your first steps should be to check out some of those prior posts. There’s a lot of good stuff there!

Marketing your mental health practice really consists of two primary areas:

  • Inbound Marketing
  • Outbound Marketing

Inbound marketing is getting people to come to you by attracting them with a message that resonates with their particular stage of the Buyer’s Journey. What that means is that if you’re offering a free informational presentation on stress relief at the local gym, you’re going to attract people who are aware that they have a problem with stress and they’re interested in possible ways to solve it. However, if you advertise therapy sessions for stress — people might not be ready to “take the plunge” and book an appointment because they may not be aware that they both have a stress problem and that therapy is the right choice. It’s too soon. So offering the free clinic is an example of inbound marketing while advertising therapy sessions is an example of outbound marketing.

Let me explain. Advertising “therapy sessions” is asking someone to buy something. It’s assuming that they think they need your “product” and that you are the right one to provide that product. A free stress clinic is not asking anyone to buy anything. In fact, you’re trying to give something of value away for free. That’s much “softer” than effectively screaming, “Buy my product!”

If you want a more detailed article about inbound marketing for therapists, please read “How inbound marketing can help you get more therapy clients.”

Outbound marketing does have it’s place though. However, rather than simply advertising your counseling practice, instead offer something of value to the potential customer, for example, a free, 15 minute consultation. You can do this in your office or using an online therapy platform (we happen to know a really good one!) The advantage of using online video for the free consults is that it saves you a huge amount of time and you can do these sorts of consultations from anywhere you have a quiet, private spot with a computer. However, the big benefit is that it lowers the friction for the potential client — it’s really easy for them to sign in, join your video session and see if you’re a good fit for their needs. It sure beats fighting traffic and then sitting in a waiting room just to have a 15 minute chat!

Marketing is a huge part of being a successful private practice behavioral health professional. Don’t even think that simply putting a listing in a therapist directory is going to suddenly lead to a lot of clients. Rarely is that the case. Put some thought into it and plan a strategy.

Therapy Practice Unit Economics

The next key to success in private practice is getting your unit economics right. Interestingly, mental health professionals are social scientists, yet oddly the pricing and economic models of many practices seem to have been developed rather, shall we say, unscientifically. Many new practitioners simply check their local area and see what others in their specialty are charging. Then, they pick a price that is somewhere in that ballpark, generally a lower price because, without any clients yet, one would think a lower price would result in more clients. That might be true, but if the unit economics of that price doesn’t match your reality, you might end up with a practice filled with clients, yet you’re still losing money! That’s no fun!

While charging $35 per hour in San Francisco might be absurd  and $300 per hour in Bozeman, Montana equally absurd, that “absurdity” is really just a reflection of what we instinctively know about San Francisco and Bozeman. San Francisco is expensive so your practice will have higher costs. Bozeman is less expensive, so. you will have lower costs. However, let’s look a little deeper into this.

What’s a good session rate to charge if your practice is in San Francisco?

a. $100?

b. $150?

c. $85?

Of course, the correct answer for that trick question is “It depends.”

People in the Bay Area would likely pick b, and that is a reasonable guess based on the prevailing costs of mental health services in that region. However, where does that number come from? Is it the right number for your business? Probably not.

Several things go into therapy session pricing and experienced therapists often arrive at their number intuitively, while a few, more business-minded practitioners arrive at their number more quantitatively.

Desired Salary divided by the number of sessions that is considered a reasonable load.

Salary/n yearly sessions = Your personal labor cost

That’s the first part. If you want to make $150,000 per year and a reasonable session load is 30 sessions per week, that means your labor cost is $100 per session. Assuming 50 weeks a year of 30 sessions. If you want a longer vacation, let’s say 4 weeks, then that puts your cost at around $105 per session.

That $100 figure is just “your” cost. You’ll need to now figure out the rest of your expenses.

Example monthly expenses for the private practice practitioner:

Office Rent: $1000

Software/Technology/Computers/etc. $100

Marketing/Advertising $500

Utilities $200

Obviously this is just a representative list — prices for these things will vary widely depending on your situation. There are also additional expenses that aren’t listed such as insurance, furniture, office amenities (such as a coffee machine,) etc.

Our sample expenses above total $21,000 per year. Using our 30 weekly session number earlier, expenses are at $14 per session, giving us a session price of $114 per therapy session.

However, it does get a bit more complicated!

These calculations are assuming you have an average of 30 sessions per week, every week for 50 weeks per year and you want to make $150,000 salary.

The problem is that you might not have 30 sessions per week. Definitely at the beginning you aren’t going to have nearly that volume! Like any business, it’s going to take some time to getting your marketing plan to yield fruit. However, what you might consider is lowering your initial salary expectations until you build your practice, but whatever those expectations are — you need to include it in your prices. One common strategy is to start your practice with slightly lower prices but then raise them for new clients as you get busier. However, alternatively, you could simply go with your desired price right away. You’ll likely have fewer clients, but as your marketing begins to work, things will improve. A basic idea is that the more effective your marketing, the higher prices you can charge.

Supply and Demand in Mental Health

Of course, the free market does have an unavoidable influence on your business, as it does for every business. So while you might desire a specific salary, your market might make that salary unrealistic. However, there is a way to determine your market-optimized rate.

The short answer is that as your prices go up, your number of clients will go down. As your prices go down, the number of clients will go up. Microeconomics 101! The longer answer is that there is a balance between the number of clients and the price you charge based on price elasticity in your specific market. We’ve written an extensive article about exactly how to do the math: “Optimizing your Therapy Session Pricing.” The basic idea in that article is that you adjust your prices until you are a peak profitability — which doesn’t mean having the highest prices nor the highest possible number of clients.

Where to go from here..

Whether you have a goal of becoming an online therapist or are looking for a conventional office-only practice, the two most important considerations are marketing and pricing. The best marketing in the world won’t compensate for flawed practice economics and the most optimized pricing doesn’t make a bit of difference if there aren’t clients to pay those prices!

If you have an Apple device and are interested in more information about Marketing generally and online marketing for therapists specifically, be sure to check out our book on the iBooks Store: The Therapist Guide to Online Marketing.

Also, if you want to see how iCouch might be able to help you improve your marketing as well as lower your practice costs, send us an email at support@icouch.me and we’ll be glad to schedule a call and have a conversation walking you through the basics!

Published by Brian Dear

Brian is the cofounder and CEO of iCouch, Inc. He has an extensive background in software engineering, inbound marketing and mental health practice management.

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