Joining an Incorporated Practice Association 501(C6) to Contract with Healthplans

A Discussion Paper

Joining a 501(c 6) organization, which is a type of business league, trade association, or professional organization, can provide several benefits for independent psychotherapists when the organization contracts with health plans.

Benefits

1. Collective Bargaining Power:

   • As part of a larger group, psychotherapists can negotiate better contract terms with health plans, including higher reimbursement rates and more favorable terms.

2. Administrative Support:

   • The organization can handle administrative tasks such as billing, insurance claims, and compliance with health plan requirements, reducing the burden on individual practitioners.

3. Standardization and Quality Control:

   • Joining a 501(C 6) can help ensure that all members adhere to standardized treatment protocols and quality measures, improving care consistency and outcomes.

4. Professional Development:

   • Members often have access to continuing education, training, and resources to stay current with best practices in psychotherapy.

5. Networking Opportunities:

   • Being part of a professional organization provides opportunities for networking, peer support, and collaboration with other mental health professionals.

6. Legal and Regulatory Advocacy:

   • The organization can represent the interests of its members in legal and regulatory matters, advocating for policies that benefit independent psychotherapists.

Process of Joining and Contracting

1. Membership Application:

   • Applying for membership in the 501(C 6) organization, may involve providing credentials, paying dues, and agreeing to adhere to the organization’s standards and bylaws.

2. Contract Negotiation:

   • The organization negotiates contracts with health plans on behalf of its members, aiming to secure the best possible terms and conditions.

3. Implementation:

   • Once a contract is secured, members may choose to provide services to patients covered by the health plan according to the agreed-upon terms of the contract.

4. Ongoing Support:

   • The organization provides ongoing support to its members, including administrative assistance, consultation, audit protection, training, and advocacy.

Example

One example of a mutual benefit organization is the American Medical Association (AMA), a 501(C 6) professional association which advocates for the interests of physicians and their patients, develops medical ethics guidelines, and establishes educational standards for medical schools.

There are several 501(C 6) Physician IPAs in Oregon, regionally organized, which negotiate contracts for their members.

By joining a mental health 501(C 6), such as the Independent Mental Health Practices Alliance, which contracts with health plans, advocates for the interests of mental health professionals, and holds high clinical and ethical standards independent psychotherapists can leverage collective bargaining power, reduce their administrative burdens, access valuable professional resources, and ultimately improve their practices and patient care.

DISCLAIMER and PURPOSE: This discussion document is intended for training, education, and research purposes only. The information contained herein is based on the data and perspectives available at the time of writing. It is subject to revision as new information and viewpoints emerge.

For more information see: https://www.mentorresearch.org/disclaimer-and-purpose