At some point in your career as a therapist, you will likely need to refer one of your clients to another professional. You may have financial reasons for doing so, or clinical ones.
Whatever the case, your goal should be to make the transition as smooth as you can, and ensure it leads to the best outcomes possible for your client.
Why referring therapy clients out can be difficult
Even if referring a client out is the right move for you and your practice, it can be a difficult decision to make.
Three reasons why:
- Personal challenges. You may feel as though you’ve failed your client, or as if referring them out reflects poorly on your abilities as a therapist.
- Client challenges. Your client may be resistant, at first, to being referred out. They may feel betrayed, manipulated, or abandoned by you.
- Referral challenges. It may be hard finding an accessible therapist who is able to meet your client’s particular needs in terms of treatment.
These are all valid and very real challenges. But the bottom line is this: If referring a client out is necessary to ensure the health and wellbeing of you as a professional and your practice as a business, then it’s the right thing to do.
The good news is that, by following the guidelines below, you can make referrals easier and less distressing for both you and your client. The important thing is to proceed mindfully, while remembering to prioritize the needs of your business.
How to prevent future referrals
If you repeatedly find yourself forced to refer clients out, it could be a sign you need to fine tune your screening or intake process.
Remember, you’re not the right fit for every client, and not every client is the right fit for you. Review what you screen for when you consider taking on a new client, including whether:
- Your favored modalities and treatment styles are a good fit for their needs
- You have experience treating clients with similar needs in the past
- Taking on the client makes sense financially
- You have room in your schedule for a new client
- You can see a clear path to a positive outcome for the client
- The expected length of treatment fits with your plans and the plans of your practice
- You’re confident you will be able to maintain a healthy therapeutic relationship with the client
- You feel, after a consultation call, that you and the client connect well
It may mean taking some extra time to review clients upfront, and sometimes turning down work when you’re in need of new clients. But the more rigorous your screening process, the less likely you will need to refer out clients in the future.
When to refer clients out for financial reasons
Therapists often overlook—or avoid—financial considerations when deciding whether to refer a client out.
It makes sense: You’re in the business of helping people, so you naturally feel a need to put people before profit. But if your practice is not sustainable, you won’t be able to treat the clients already on your list, or new clients for whom you may be a perfect match as a therapist.
So, even as you strive to put your clients’ needs first, keep in mind these (totally acceptable) financial reasons for deciding whether to refer out a client.
Downsizing
Sometimes your practice needs to shrink its operations in order to survive. That could be because you’re focusing on a different revenue stream—consulting rather than one-on-one therapy, for instance.
Or it could be because you need to reduce operating costs, and the cuts you’re making mean you’re no longer accessible to all clients. Switching from in-person to 100% remote therapy is a good example of this.
Raising your rates
In order to remain sustainable, your practice needs to pay its bills, and also pay you a living wage. There should be no shame in raising your rates—but it may mean some clients will not be able to afford continuing to see you.
In that case, you’ll need to find other options for them.
Loss of insurance coverage
If a client loses insurance coverage, they may no longer be able to afford therapy at your current rates.
Similarly, if you drop an insurance company (because of low reimbursement rates, or any other reason), or if you decide to become a cash-pay-only practice, some of your clients may no longer be covered and no longer be able to afford seeing you.
Shutting down or changing your practice
There may come a time when it makes sense financially to close your practice—either because you’re leaving to work for another practice, or to pursue a different career.
Some therapy practices also shut down temporarily. For instance, if you’ve been offered a 12 month teaching contract that will prevent you from running your practice, you may need to hit “pause” for a while.
Finally, you may decide to transition to a new type of therapy. For instance, if you decide to switch from a mixture of one-on-one therapy and group sessions to group sessions exclusively, that could mean shutting your doors to some existing individual therapy clients.
When to refer out clients for clinical reasons
Money isn’t the only motivator when therapists decide to refer out clients. Sometimes, because of your relationship with a client or because of their treatment needs, it’s no longer ethically or practically sound for you to continue seeing them.
Not being able or no longer being able to treat a client
Your client’s treatment needs may change over time. Or you may discover, after a period of ongoing therapy, that your initial assessment of their needs was incorrect.
One example might be a client you took on for treatment of anxiety and depression. After multiple sessions, you come to believe they have a complex personality disorder that you have no experience treating and which you feel is beyond your abilities to address.
The code of ethics makes it clear: If you don’t have expertise treating a client’s conditions, you should not attempt to treat them. If that’s the case, you should refer them to a different therapist.
An unhealthy therapeutic relationship
Trust, empathy, respect, and a spirit of collaboration lay at the heart of the therapeutic relationship. When those values erode, the therapeutic relationship between you and your client begins to break down.
Likewise, when professional boundaries fall apart, and you’re no longer able to see your client simply as a client—in a word, when your personal lives become entangled—the therapeutic relationship is no longer healthy.
In that case, it’s time to find your client a new therapist.
Negative impact on your mental health
As a therapist, you already know that emotional fallout is a hazard of the job. But if treating a particular client is starting to impact your mental health negatively, so you’re no longer able to leave your work in the office and pursue a healthy life outside of it, it could be a sign your client needs to go.
Inability to fulfil clients’ needs
Clients’ needs aren’t just limited to certain types of treatment.
Scheduling conflicts are a good example of this. You may have a client who, because of their particular challenges, needs to be able to see you three times a week, but you don’t have enough space in your schedule.
Or else they may be in constant need of emergency support outside of office hours that you’re unable to provide, or require you to complete extra documentation and paperwork—for instance, as part of a residential recovery program—that puts an unsustainable burden on you.
When you can’t meet those needs—or when meeting them would put undue strain on your practice, and potentially compromise the treatment you are able to offer your other clients—it’s totally valid to refer your client to another therapist.
Dead end or impasse in treatment
When your client’s treatment has hit a dead end, or when you’ve reached a point where they are no longer willing to pursue a particular course of treatment, it may be time to refer them to someone else.
A different professional may be able to take up the torch and help your client on the next stage of their journey. If that’s the case, it doesn’t reflect poorly on you as a therapist. After all, you’ve played an important role—but now it’s time to step back and refer your client to someone else.
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How to refer therapy clients out of your practice
Since every client is different, and since your own qualities and expertise make you unique, there’s no one-size-fits-all solution when it comes to referring clients out of your practice.
That being said, there are some best practices you should try to follow. Doing so not only benefits your client but may make the process smoother for you.
Introduce the topic at the right time
Schedule time in the last ten or fifteen minutes of a typical session to bring up the possibility of referring your client out.
If changes in your practice—such as no longer accepting a certain type of insurance—make this necessary, it’s better to talk to your client one-on-one than to send out a mass email.
If the matter is urgent—if your therapeutic relationship has been severely compromised, for instance—you may want to move the discussion to the beginning of your session and cut the remainder of the appointment short.
Be clear and upfront about your reasons for recommending the referral, and take whatever steps are necessary to ensure your client doesn’t feel blamed or persecuted. How you do this will depend on the particular client, but the important thing is not to impede them or set them back in their treatment.
Involve the client in decision-making
Before you talk to your client, you should have at least three other therapists in mind who you are willing to refer them to.
First, let your client know they have a choice: You can either help them through the process of connecting with one of the therapists on your list of options, or you can stop seeing them as a client and let them seek out a new therapist on their own.
Then, discuss referral options with your client, being sure to mention any relevant information—such as insurance coverage or location—that could impact their choice.
Your client should feel as though they’re being presented with a choice as they move to the next stage of their journey, and not being forced down a particular path against their will.
Find qualified therapists
When deciding who to refer a client to, turn to your professional network first. The therapists you have already connected with personally are the ones you know the most about, making it easier to pick someone who is the right fit for your client.
After that, you can broaden your search, and reach out to therapists who are able to meet your client’s needs but whom you don’t know personally.
It’s important to consult first with any therapist you’re considering referring your client to. You need to make sure they not only have capacity to take on new clients but that they’re prepared to take as a referral a client you have already been treating.
Set up a smooth transition
Once your client has decided on a therapist they’d like to work with, get confirmation from them that you may share your treatment notes with the new therapist.
It may be a good idea to print out a simple agreement and have your client sign it, so you have a record of their consent.
Sharing your notes allows the new therapist to get a sense of your client’s treatment journey so far, as well as any particular obstacles they should be prepared to confront. It smooths your client’s transition between therapists, while also giving their new therapist the tools they need to provide the best treatment possible.
Key takeaways:
- Referring clients out of your practice may be emotionally challenging, but you should always aim to do what is best for you as a professional and your practice as a business.
- Financial reasons for referring clients out include downsizing, an increase in rates, loss of clients’ insurance coverage, or the shutdown of your practice.
- Clinical reasons for referring clients out include your inability to treat them, an unhealthy therapeutic relationship, negative impact on your mental health, scheduling conflicts, or a dead end in treatment.
- Make sure you choose the appropriate time and setting to bring up the possibility of a referral. A point near the end of a regular session is often the best time for it.
- You can make the referral easier for the client by providing them with options for new therapists, and sharing (with the client’s consent) treatment notes with the therapist they choose.
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Curious about what other paperwork you need? Check out our complete list of policies and paperwork for your therapy practice.
This post is to be used for informational purposes only and does not constitute legal, business, or tax advice. Each person should consult their own attorney, business advisor, or tax advisor with respect to matters referenced in this post.
Bryce Warnes is a West Coast writer specializing in small business finances.
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