Welcome therapists and group practice owners! I’m Nicole McCance, a psychologist turned business coach for therapists.
Are you leaking revenue without even knowing it? Most practice owners are, and the frustrating part is that it’s money you’ve already earned by doing the work and seeing the client. It just quietly slipped out somewhere between the session and your bank account.
I recently sat down with Jeremy Zug from Practice Solutions to talk about exactly where that money goes. Jeremy and his wife have spent almost ten years running a billing company, and he’s seen just about every way a practice can lose money without noticing. (He’s one of our American billing experts, so a few of his examples are about US insurance. Don’t worry, my Canadian friends. Revenue leaks happen here too, and the principles apply no matter where you practice!)
P.S. Not a huge fan of reading blogs? (I’m more of a podcast girl myself.) You can listen to my podcast episode all about this topic by clicking here!
What Are Revenue Leaks in a Private Practice?
A revenue leak is income you rightfully earned but never actually collected. It’s the declined card nobody followed up on, the session billed at a lower rate than it should have been, or the claim that piled up in a denials folder and got forgotten.
None of these feel dramatic in the moment, and that’s exactly why they’re so sneaky. A few dollars here and a missed payment there don’t set off any alarm bells, but over a year they quietly add up to serious money. Let’s walk through the three biggest leaks Jeremy sees.
Revenue Leak #1: Uncollected Client Payments
uncomfortable… asking clients for money.
Here’s the rule Jeremy lives by. Once a client walks out your door, your chances of getting paid drop fast. So you have to collect either before the session or at checkout, never after. Think of a drive-thru, where you pay first, then you get your coffee. There’s a natural, healthy friction point there, and your practice can use the same model.
Here’s what this looks like day to day:
- Keep a credit card on file and run it the moment the client arrives. (In my clinic, I trained my admin to charge the card as the client sat down in the waiting room, so we caught expired or declined cards before the session even started.)
- Give your team a simple end-of-day checklist so no balance slips through. Most EHRs like Jane App let you run a report and clear balances with one click.
- Skip e-transfer. I stopped allowing it entirely. Clients would say “just sent it,” wave goodbye, and the money never landed. Credit card only means you can actually verify the payment in hand.
I know some of you are already thinking you can’t afford to hire an admin to manage all of this (I’ve been there in the early, cash-strapped days). But you also can’t afford not to collect. Paying someone $22 to $25 an hour to reliably capture fees of over $100 a session is a no-brainer.
Revenue Leak #2: Getting Paneled at the Wrong Rate
This one is mostly for my American friends, but stay with me, because there’s a lesson in here for everyone.
For years in the US, therapists had to go through a six-month credentialing process before an insurance company would even tell them what they’d get paid. A new law now requires insurers to post their rates, and Jeremy’s team built technology that reads those files and turns them into something you can actually understand.
So here’s the new order of operations if you’re credentialing in the States:
- Check the rate in your area before you apply, so you don’t burn six months getting paneled for $68 a session when the practice across town is earning $250.
- Bring that data into the negotiation. If you’re a group that keeps clients out of the ER, make the case for the higher rate.
Even $40 more per session sounds small, but at scale it’s life-changing. In a practice the size of the one I ran, that’s easily a hundred thousand dollars a year.
For my Canadian friends, you have a freedom Americans don’t, you get to set your own rate. When I was in practice, my association suggested $230 for a psychologist, but I charged $275 because I could make the case for it. Please don’t undercharge just because a benchmark told you to!
Revenue Leak #3: Billing in the Wrong Order
This is a small change that makes a real difference to your cash flow, and it applies whether you take insurance or you’re fully private pay.
Most of us feel the urge to hit submit the second a session ends. Jeremy says that’s backwards.
The better order is to post the payment first, document any issue (a declined card, or a denied claim), follow up and solve it, and then submit. When you fire off claims frantically, you pile up denials that cost far more to untangle than they would have cost to get right the first time.
And please, don’t do your own billing or blindly trust that it’s being handled. I learned this one the hard way. Back in solo practice, I kept asking my admin where our third-party billing money was, and she swore up and down it was all submitted. I believed her, and I didn’t verify. A full year later I finally pulled the report, and the billing had never gone through (I almost fell off my chair). By then it was too late to collect.
Hot Tip: Jeremy and his team support with billing. Learn more about Practice Solutions here.
Plug the Leaks Before You Chase More Clients
It’s tempting to believe the answer to every cash-flow problem is more clients. Often it isn’t, and the faster win is simply keeping the revenue you’ve already earned from slipping away.
So pick one leak this week. Run your aging report, check your rates, or sit down with your biller and look at the numbers together. These are small shifts, but they add up fast, and at scale the difference is enormous.
Want more strategies for growing your therapy practice? Follow me on Instagram and listen to the Business Savvy Therapist podcast for strategies and real talk about scaling a 7-figure group practice without burning out.
Your Business Bestie,
Nicole
