New survey data paints a picture of the financial status of private practice therapists.

It also reveals specific details about the rates private therapy practices set for private pay, or cash pay, sessions and that they receive from payers. These vital but often hard-to-find insights illustrate the wider financial dynamic for private practice therapists.

Mental health-focused accounting startup Heard conducted the survey. It garnered responses from 1,216 therapists between February 6 and February 17, 2023.

Nearly 80% of respondents report private pay session rates between $100 and $200. The two most common rate ranges — about 21% — were $125 to $150 and $150 to $175.

Very few — only 3% of respondents — reported charging $200 or more for a session.

Most private practice therapists (58%) reported being “very worried” or “somewhat worried” about the economy’s impact on their practice.

“Concerns about the future may also be reflected in therapists’ plans to increase their rates: 63.5% said they planned to raise rates in 2023, which may correlate with the number of therapists who said they were concerned about the economy,” the report states.

Several economic indicators have produced mixed signals in the last year or so. The American economy continues to add jobs at historic levels while the national unemployment rate has reached pre-pandemic lows. Starting in 2021 and throughout 2022, inflation in consumer prices spiked, and continuous increases in interest rates made the cost of doing business much higher.

Investors took notice of economic conditions before the year. And near the midpoint of 2022, investing and dealmaking in the space are down significantly.

However, the outpatient mental health space stands apart. The M&A advisory firm The Braff Group has found that dealmaking in the mental health space in 2023 may surpass 2022 levels.

Still, a larger proportion of private practice therapists report charging less in private pay rates than they would get in typical payer reimbursement for a session.

While nearly 80% of therapists reported charging between $100 and $200 per private pay session, about 56% of therapists reported the same range for typical payer reimbursement.

Fewer therapists report receiving more than $200 for reimbursement (11%) than those charged at the same price range (15%).

On the payer side, 47% of therapists reported reimbursement rates between $100 and $175. The largest share of respondents (26%) report typical rates between $100 and $125. About 12% reported receiving less than $100 per session, compared to 7% in private pay for the same price range.

About three-fourths of therapists accept insurance while the remainder do not. This aligns somewhat with previous survey research by the National Institute on Mental Illness that found about 72% of patients receive care from mental health therapists on an in-network basis.

The top five states where therapists were based — California, New York, Florida, Texas and Colorado — represented about 44% of responding therapists. The greatest share of respondents was based in California at 22%.

While many respondents had several license types, most identified as social workers (27%) or mental health counselors (23%).

Most respondents (42%) reported that their expenses were less than $25,000, with rent and dues/subscriptions (28% and 24%, respectively) being the most common top expense. But about 65% of respondents reported annual net income of $100,000 or less.