Q: I’m an LCPC in Northern Illinois. I have a private practice and have always wondered if my home and personal assets are protected in the event of a lawsuit. I have the recommended malpractice insurance coverage. However, I am not incorporated. Some social workers I know say they are incorporated because it prevents anyone from coming after their homes and money in the event of a lawsuit. I recently spoke with an attorney by phone who said that offers no protection. He said that counselors are the same as lawyers, dentists and other service providers, and even if you are incorporated, your personal assets could still be part of a professional lawsuit. What do you know about this, and what do you recommend? I would like to avoid the expense and paperwork of incorporating if it provides no further protection.

Thanks for all your great work and help. I always turn to your column first in Counseling Today.

A: Your question is excellent. Most professional counselors in private practice do not consider what type of business entity makes the most sense for their practice. While we are not attorneys and do not give legal advice, based on our experience in practice consulting, the attorney you consulted was correct. That’s why we have always recommended that professional counselors get the highest level of coverage offered by the insurance company. Corporate structures do not protect officers of the corporation from wrongdoing. Just look at companies such as Enron, whose top executives went to jail and are responsible for fines and damages.

Corporate structures do offer protection from debts of the corporation, however. For example, in selling an outpatient drug and alcohol program, I had two buyers with the same offer. One was from a corporation and another from a group that was willing to personally guarantee the offer (separate and apart from the corporate structure). If either had defaulted, it would have been more difficult to collect from the corporation.

Moreover, different business entities such as sole proprietor, a professional limited liability company or a corporation do have pros and cons regarding taxes and wealth management, so consulting a tax adviser as well as an attorney is highly recommended. All that being said, we have never heard of a professional counselor losing his or her home and personal assets in a lawsuit.

Q: My name is Rachel Milazzo, and I am in charge of the Provider Relations Department for American Behavioral. We are a growing managed behavioral health care and EAP (employee assistance program) company based out of Birmingham, Ala. I am interested in the opinion of your readers as to some incentives I can offer providers who are currently enrolled and prospectively applying for credentials with our company. We have a great retention rate now, and I’d like to create some rewards to thank this group of people. Thoughts that have been thrown out are free CEU classes, free seminars, billing workshops and focus groups.

I am interested to see your readers’ ideas to make this program take off. I know this is not a new concept, but if I have suggestions that can make it better and more effective for the providers, I am willing to do whatever I can.

A: We are very pleased that a managed care company would contact us, asking our American Counseling Association members for advice on how to cooperate and work together. It wasn’t too long ago that insurance and managed care companies ignored counselors. We like your ideas to help make credentialing easier, as well as providing free seminars and workshops offering CEUs.

Our thoughts for ways to help counseling providers include having online workshops on electronic insurance billing and classes on filling out the billing forms using the correct HIPAA and National Provider Identifier information, how to avoid having claims rejected and how to ask for and meet requirements to have managed care companies increase reimbursement rates based on counselor experience.

We ask our readers to contact us at walshgasp@aol.com with additional ideas to pass along for CEU workshops and seminars.

Private practice tip: Managed care and insurance companies have differing rates for certain Current Procedural Terminology (CPT) codes. Remember that a diagnostic (first) interview, 90801, pays a higher rate on most fee schedules. Blue Cross Blue Shield pays considerably higher for the first session. Another good example is UniCare Mental Health. The company pays $60.16 to master’s-level professionals and $69.41 to Ph.D.s for a customary 45- to 50-minute 90806 office visit, but it pays $73.14 (master’s) and $84.39 (Ph.D.s) for a 45- to 50-minute family session (90847) and even more for hypnotherapy (90880). Always check the fee schedules of each of the companies you deal with to be reimbursed at the best rate available for your counseling efforts.

Note: American Behavioral is now accepting licensed counselors for its panels. The company covers more than 700,000 insured employees across the continental United States. American Behavioral can be contacted through its website at www.americanbehavioral.com.

The Illinois Mental Health Counselors Association will be offering our private practice workshop on June 8. More information is available at www.imhca.org.

Robert J. Walsh and Norman C. Dasenbrook are coauthors of The Complete Guide to Private Practice for Licensed Mental Health Professionals (www.counseling-privatepractice.com). ACA members can e-mail their questions to walshgasp@aol.com and access a series of “Private Practice Pointers” on the ACA website at www.counseling.org. Letters to the editor: ct@counseling.org