therapist employment

Types of organizations employing mental health providers

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While we may not think about it much, therapist employment is dependent on somebody who went through the trouble of figuring out how to set up the organization. Doubtless the founder consulted with an attorney and an accountant to evaluate the many legal and practical reasons to favor one type of business organization over another. The founder made the decisions and the organization got underway.

The legal frameworks for mental health

Most outpatient psychotherapy is provided in one of several types of organizations. The least complex, but perhaps one of the more challenging, are solo practices. These are usually sole proprietorships where a single therapist rents space, hangs out his or her shingle, and practices alone. Large group private practices are more organizationally complex many therapists at a location. They are usually formed as a corporation owned by one person or by many, i.e. a partnership. And still more organizationally complex are the not-for-profit community-based organizations.  And of course there are many the non-clinical organizations such as schools or corporations that hire many therapists as well. The range of possibilities is diverse, with no two organizations exactly alike.

Where we begin

Some clinicians get their first job and stay with it for the rest of their career. They may advance through the ranks from a clinician to a supervisor to a manager and perhaps become an administrator.

But just as often, therapists move from that first job to another that they think might be a better fit. Often that next job is into an existing organization created by others. Others move out on their own, creating something brand new. They create an entity or organization that did not exist before they created it.

As I have looked at practice development therapists largely create one of six types of organizations.

Option 1 Solo practice

This is the most common work setting for providers of mental health and entails creating a new practice that is no larger than the solo practitioner while perhaps contracting for some support services.

Option 2 One owner and several employees

This organization begins with a clinician building a solo practice but morphs into something else. As the practice does well enough to grow in both a clinical and business sense it become more complex. The big transition for Option 2 organizations is when the clinician decides to hire others. Usually this is in response to the overflow of work that his or her efforts have generated.

The thinking generally begins with “I’ve got this solo practice thing pretty well figured out for myself, so why not have other folks working with and for me?” So the clinician becomes the employer of others, who then follow in the wake of the founding therapist. With this organization there is no other partner and it is clear who the leader is—often the most senior practitioner, and certainly the one who generated the early business in the organization. (Read more about the decision to hire other in this post: The dilemma of success: Do it myself or delegate.)

Option 3 Partnerships

Option 3 is yet another kind of beast. It involves a group of like-minded therapists finding each other and joining to form a new venture. This begins when the group of partners find each other and decide to join forces. Hopefully they find others who are at about the same level of accomplishment and who seem to be going in roughly the same direction. Perhaps they met while working in a larger institution, a hospital or large group practice, or maybe they are friends from graduate school or colleagues in the community. Wherever they meet, they have in common the desire to minimize costs and maximize autonomy. (Read more on the issues involved in forming a partnership in this post: Partnership Challenges.)

Option 4 Not-for-profits

Option 4 organizations begin with a mission. Someone sees an unmet need for which he or she has a passion. In mental health that need might be for serving the poor or the youth of a community or serving some other population. These types of organizations become the not-for-profit sector of the mental health system. They grow as the originator of the mission is able to get others emotionally and financially invested in that mission. This means communicating that vision to a not-for-profit board. The board in turn are responsible for the organization and for passing the mission on to wider community. The job gets done as everyone pulls together and supports the mission.

Option 5 Non-clinical settings

This is a category of organizations that employ many therapists but does not entail the creation of a new organization. Instead the mental health function is grafted on to an already existing organization. The primary mission of the parent organization is some other goal than one directly related to therapy or clinical work. For example, many therapists work in school settings where the primary mission is an educational objective. Churches or other religious organizations, while primarily focusing on evangelistic and/or social justice objectives, also employ many therapists.

Other therapists work in non-clinical corporate environments. Usually the goal here is to create or provide some services other than outpatient psychotherapy. For example, the mental health workers may run a program such as an Employee Assistance Program. The organizational leaders in Option 5 organizations hire mental health professionals, believing that in some way they make a meaningful contribution to the overall objectives of the organization.

Option 6 Hospitals and government

Finally, there are positions in hospitals and within federal and state facilities that provide psychotherapy much akin to what happens in outpatient settings. But there are not many.

Through the 1970s to the 1990s the government shut down most of its inpatient facilities, and hospitals eliminated longer-term inpatient care. With those changes came the wholesale elimination of long-term interactions with patients. Hospitals and institutions became oriented around crisis stabilization and management rather than long-term care. This trend continues to today.

There are a few exceptions, with the Veteran’s Administration (VA) providing some ongoing programs for veterans that include outpatient psychotherapy, though most of these services are in a group format. But increasingly, outpatient psychotherapy is independent of hospital programing. (For an explanation of why hospitals are not often involved in outpatient psychotherapy see this post: Wealth in mental health.)

Medical facilities tend to view mental health as the “stepchild” of the larger medical facility. Psychotherapy is only a small part of the inpatient mental health system. Yet because of the exposure to a wide range of people with diverse mental health issues these can be excellent places for clinicians to learn and grow.

Also read:

What I wish I had known about mental health private practice

From nothing to something: The early years of my practice and organization

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  1. Thanks, David. I am now in the midst of none of the six options. Getting my pension. Have a free office at St. Mark’s. Do some counseling and spiritual direction. Help people find counselors and spiritual directors. Receive some remuneration. Have a call to work with elderly and those with disabilities…An odd beast, but a beast I love.

    1. Hi Catherine. Indeed there are many places that value our clinical skills. I am hearing from many who found ways to use their gifts that are beyond the typical “outpatient psychotherapy” gig. Glad you are working your calling. Sounds very interesting. BTW, how did you notice my post? Via LinkedIn?

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