93: Therapist or Coach: Who Should I Work With
Therapy or Life Coach?
Therapy is for mental health treatment, including a diagnosis. No life coach should treat mental illness. While there are many differences, there are similarities too, in that both professions generally aim to help improve the lives of those they serve.
Life Coach Cost
How much does it cost to work with a life coach? Life coaches can charge per hour, per package, or on a retainer rate, making it a bit tricky to compare a per-hour cost. According to Noomii, the hourly rate of a generalized life coach is $75-200. For an executive coach, someone who specializes in helping people in the C-suite, an hourly rate is in the $400-500 range (Conference Board Council of Executive Coaching 2008). The same goes for business coaching. If you are looking to hire someone to help you with business coaching, it’s easily in the $500-1000 hourly range, all the way up to $30,000-50,000 for an annual business coaching retainer (Noomi, 2018).
Therapist Cost
How much does it cost to work with a therapist? Depends on a lot of factors, but according to a therapist Electronic Health Records software program data analysis, in 2018 charged between $120-150 per session but that was a national average (Simple Practice, 2018). If you look at a city like Miami-Ft. Lauderdale, it ranged from $100-200, with the median rate of $175 (Simple Practice, 2018). 8.2 million session rates were collected in 2018 from nearly 35,000 unique SimplePractice customers in all 50 states and the District of Columbia.
The average cost of a therapist with insurance also depends based on what your insurance provider reimburses, your copay, and how long it takes you to meet your healthcare deductible. At the time of this post, I dug into what Medicare was reimbursing as a benchmark to see what insurance companies should be reimbursing. According to Medicare, they reimburse $141-152 per hour for a 1-hour therapy session (2021 Medicare Rates for Mental Health). Your first session is called an Intake session, and in 2021 Medicare reimbursed between $145-180 (2021 Medicare Reimbursement Rates for Mental Health) for that service. The low end of the range is for master’s level clinicians, with the high end of the range being the reimbursement rate for PhDs and MDs.
Legalities of Working with a Coach
Many coaches are certified through organizations that have ethical standards they must adhere to. But anyone can call themselves a coach. It’s on the client to do their due diligence to learn about the coach’s education, background, and training that qualifies them to coach on the topic they coach on. There are some strong legal distinctions and things coaches cannot do, so make sure you’re mindful when hiring a coach that they aren’t doing any of the following:
Coaches cannot bill to an insurance provider nor can clients submit their coaching bills to their medical insurance provider for reimbursement (sidebar: some companies do pay for coaching or provide a coaching stipend; this is separate from the coach billing through or to insurance)
Diagnosing, treating, or providing intervention for any type of mental illness.
Describe their services using any of the terms that are reserved for therapists to use in their scope of practice.
Provide any services that look like psychotherapy
For example, a coach could say they provide “wellness coaching,” but they could not say they provide “depression coaching.” The former is vague and not a diagnosis, the latter is a mental health diagnosis. When you see coaches using diagnoses in their labels or what they treat, make sure you get a clear answer from them about what they mean. Similarly, they could provide “mental well-being techniques,” but they couldn’t provide “mental health treatment”
Legalities of Working with a Therapist
Working with a therapist means the therapist is legally bound to practice care within certain jurisdictions. Most therapists’ licenses are state-bound, and they have to adhere to that particular state’s board of ethics. Broadly speaking, all therapists must not engage in dual relationships with their clients. If a client has a complaint about their therapist, they can report them to the therapist’s board or state. Some legal protections in place when you work with a licensed psychotherapist (they could hold the title of Social Worker, Counselor, Psychologist, or Marriage and Family Therapist) are:
Credentialed training and education, with continued education to maintain their licensure
Supervision and oversight by a regulatory body
Mandated to comply with HIPAA and adhere to reporting requirements (often called “mandated reporting”)
Who Should I Work With?
If I haven’t driven it home enough, if you need mental health treatment, you need a licensed therapist. Outside of that, there could be times where a therapist is more appropriate, a coach makes sense, or times where it could go either way!
I’m an experiential learner which means I need to see examples of how things are, so I’m introducing three different avatars or vignettes to help with today’s podcast and corresponding post. These are completely made up, so any similarities to a real person, living or dead, or actual events, is purely coincidental.
Therapy Client Example
Aliyah is a recent college grad in her first job as a water treatment project coordinator. She describes herself as a classic “type A overachiever.” She excelled academically in college, sat on the board of an environmentalist group, and interned at a prestigious lab in her final semester of school. When she was in college, she’d have occasional sleepless nights or moments of panic leading up to exams, but overall she felt ok. She comes from a family of “intense immigrant parents” and suspects some mental illness but nothing has been discussed, let alone diagnosed or treated.
Now she’s having sleepless nights 2-3 days per week, intense moments of panic before meeting with senior leadership, and having ruminating thoughts throughout the day that she’s forgotten to finish all necessary components of her work. She’s stopped exercising and occasionally forgets to eat because of business and stress. She’s tried mindfulness apps, journaling, and yoga, but doesn’t feel relief from what she thinks is burnout. Her main complaints are that she feels like she can’t keep up the way she used to, she feels on the edge all the time, and her sleep is a mess.
She starts in weekly therapy and it cost her a $30 co-pay each session for the nine months of working with a therapist.
Coaching Client Example
Quinn is an elder millennial in a “fine job in a fintech startup.” When he started, he found the pace of the job to be exciting, but now that he’s been there several years and the company has grown he feels like it’s “too corporate” and he finds himself daydreaming of other work. Outside of work, he loves trivia nights, hiking, and visiting his family. He was in therapy in college and was diagnosed with mild depression that has been successfully managed with a low-dose SSRI for over 10 years through his primary care provider. He wants help figuring out if he needs to be more thankful at his current job, or if he should find something else but feels overwhelmed and “whiny” for thinking he wants more out of his work.
He finds a career coach and works with them in a 6-week package that costs $2,500.
Therapy or Coaching Client Example
Max is also an elder millennial. Max is mixed race, nonbinary, and has been learning more about their ancestry and lineage in recent years. To their knowledge, there isn’t a family history of mental illness, and they haven’t been diagnosed with any mental illness. They have a strong interest in incorporating decolonization into their life. They’ve played around with Reiki, Tarot, and Astrology and are looking for more guidance around creating a liberatory practice for themselves.
They decide to work with a liberatory coach, who uses elements or reiki twice per month for $175 per session. Max could easily have worked with a coach or a therapist. The therapist would need training in or an interest in intersectional social justice, somatic work, and working with mixed-race people or marginalized communities.
Takeaway: Working with a Therapist or Coach
In general, you can expect to pay between $75-200 per hourlong session when working with a life coach, and between $120-200 when working with a therapist. Coaches and therapists can be helpful to have in your corner when you are looking for self-improvement, but only therapists can practice mental healthcare and treatment.
Are you “Just not good at the money stuff”?
If you are a small business owner and after listening to this podcast, you’re thinking to yourself “I have no clue how much money my practice needs to earn,” I invite you to join me in my small group coaching program, Grow a Profitable Practice From the Inside Out. I run this program throughout the year, and past participants have shared that it "was more than worth it for the self-growth, business growth, and mindset."
Read through the program details and consider applying if you are ready to have loving support and accountability as you grow your online therapy practice sustainably. Not only will I help you set a sustainable rate for your practice, but we'll also cover money mindset, adhering to boundaries, niching, writing your website for SEO, and how to practice self-care. Be sure to join my waitlist to receive updates on the details of my next cohort!
-
Thanks, everyone, for your understanding last week that I just could not get to a podcast. And while I understand that life is still going on and that things are scary and rough and traumatizing and re-traumatizing in a lot of places, I'm doing my best to compartmentalize. I feel safe enough to report--report this podcast, I'm not a reporter, I'm a podcaster. Let me be really clear to record this podcast. So this is kind of part two off of the episode 92 about what a therapist or coach can earn and today we're flipping that question and talking about who should you work with, and what might it cost if you're ready to get help from a third party. So let's get into it. Okay, before I dive into therapy versus coaching, and how much it costs to work with a therapist or coach, it took me so much longer than usual to prep this episode for you. Because finding out average cost of health care where I'm located in the United States is a total pain in the ass. So I had to do some digging into Medicare, CPT billing codes trying to find averages. So I think I found like, a good enough number that makes me feel really comfortable. And I also have to remind myself like, I'm not an investigative reporter. This is not my like PhD thesis. This is a podcast. So these are the numbers that I found, just know that I really did my due diligence before hitting record. So don't yell at me. When I tell you the numbers, I will cite my sources, and you will be able to find them all linked in the show notes.
So figuring out the cost of health care was a total pain in the ass. And then trying to figure out coaching was a total pain in the ass. Because it's kind of like saying, How much should I spend on a car? It's like, well, what, what kind of car do you want? There's like a zillion factors that go into answering that question. Are you buying something new? Or pre owned? Are you buying something gas, electric or hybrid? Are you buying like a two door coupe convertible? Or are you buying an SUV? If you're buying it used--Is it refurbished or not? Are you buying from a dealer or private? It's like, really, really a hard question to answer without having some really nitty gritty details. So I did my best, but there is not going to be an easy apples to apples comparison. Like it will not be you know, a therapist cost x and a coach cost y. So you know, you should go with a therapist or coach. So if you're looking for an easy black and white answer, I hate to disappoint you, but I also just want to manage your expectations and to help kind of take some of the information that I've gathered and some of the data that I've gathered and put it into something you can actually use. I will be providing some totally made up case studies at the end of this to help you really picture in your mind's eye who might consider hiring a coach versus who might consider working with a therapist. Cool! So just a reminder, and again, this is a light summary, don't get mad at me. Do you know how many people got mad at me? Episode two weeks ago, everyone was like, Coaching is not therapy. And I was like, I know. I did not say that. But people got all sorts of riled up. So if you got triggered last time, maybe this is a good episode to skip. Not all episodes are for everyone. So therapy as a reminder is for mental health treatment, including a diagnosis, no life coach should be treating mental illness. And while there are many differences between coaches and therapists, there are a lot of overlaps in that both professions generally aim to help improve the lives and well-being of those that they work with and those that they serve.
So let's start out with the cost of a life coach. So how much does it cost to work with a life coach? Life coaches can charge per hour, they can charge per package. So a package might be like an onboarding and offboarding session, a few 30 minute or hour-long session. And maybe like an emailed summary of the work you did. Some coaches work on a retainer rate where you pay upfront and you have access to them for a month or a quarter or a year. So that makes it a little bit extra tricky to compare costs per hour, which is what I tried to do I tried to have like the general denominator or the general variable that I'm going to be looking at today is the cost per hour. So according To Noomii, which is a coaching website, and they have analyzed data from the coaches who are listed on their site. So already we know we've got a bias, we only have people who are using their site to list their services. So I don't know exactly what type of coaches tend to list themselves on this particular directory. But anyway, according to Noomii, not Noom, the hourly rate of a general life coach, so just somebody who says I'm a life coach is in the $75 to $200 per hour range. So that's a pretty big range, but that number didn't really surprise me. So anywhere from $75 to $200 per hour-long session with a general life coach, but once you get into specialties, that range goes all over the place. For somebody who specializes in executive coaching, so this is somebody specifically who helps people in the C suite, an hourly rate is in the $400 to $500 range, big asterisk here, I got that number from the Conference Board Council of Executive Coaching, and that number came from a study they did in 2008, they had an updated study for like 2018, or 2021. But I could not get access to it because I'm not a coach. So this is the last public data they have. So take that with a grain of salt. Some of you executive coaches might be going, oh my god, I charged double that or triple that. And that may very well be true. But this is the number I got from public information that was available to me. And then it gets even wilder when it comes to business coaching because it can go everywhere, again, according to Noomii. So that was the first place that I referenced, they said that business coaching can run in the range of $500 to $1,000 per hour, but there are also these retainer-based models that can run up to $30,000 to $50,000 for an annual business coaching retainer. So this is if you work with somebody in like a high touch business coaching mastermind, it could be several tens of thousands of dollars to invest in your practice. When I had Joe Sanok, on my podcast, gosh, almost a year and a half ago, he said he invested $30,000 in one of these business coaches, and it totally transformed his business. Then on the flip side, I know lots of people personally who have invested tens of thousands of dollars with business coaches that haven't done really anything to help them move the needle. I don't say that to say that business coaches are bad. I say that to say, do your research, ask for outcomes, make sure that they work with people like you, because that type of investment can be worth it, if you know that it will work for you.
So moving on to the cost of therapists. This is really where I was like pulling my hair out. Because in the United States, there is no flat rate for when you go to a therapist, it will cost you this many dollars. Just like when you go to your primary care provider. There isn't like a menu when you go to your primary care provider. And it's like, by the way a physical will cost this much, blood work will cost this much, like it's just so freaking hard to find. So how much does it cost to work with a therapist? It totally depends. So where I pulled this data from, was Simple Practice. Simple Practice, for those who don't know, is an electronic health record specifically for service based health care providers. So I personally use Simple Practice to do my scheduling, my billing, and everything like that and they work with therapists, physical therapist, pelvic floor therapist, psychiatrists, occupational therapists, anybody who's in that kind of healing profession, medical profession can use Simple Practice. I also know lots of coaches who use Simple Practice because just the integrations are really nice. This is not an ad for Simple Practice, just wanted to paint the picture of what Simple Practice is. Because what are used for the average cost of a therapist was a study that they did have their users back in 2018. So in 2018, they compiled and analyzed this data from 8.2 million different sessions in 2018 for over 35,000 Simple Practice users across the United States and including Washington DC. So they compiled this data from all of these different states in 2018. And what they came up with was on average in the United States In 2018, most therapists were charging between $120 and $150 per hour long session. But again, that's the national average. And that was several years ago, if you pull out a city, so for example, I pulled out, I guess it wasn't a city, it was like an area I pulled out Miami, Fort Lauderdale. And that particular area, the the range of per hour therapy cost between $100-$200, so much more of a range than $120 to $150. In the median range in that $100 to $200 in Miami, Fort Lauderdale, was $175. So you can see how $120 to $150, on average, doesn't quite capture the nuance of being in a specific city or for anybody who didn't use Simple Practice, right, this is just their consumer data. So we don't know, people who used other electronic health records, who don't use electronic health records, who do everything by paper and pen and send their make their superbills by hand and send their insurance claims in by hand, we don't have any of that data, we only have a certain specific subset of people from Simple Practice. And interestingly, when I was looking at the data, it was more heavily weighted towards California, because Simple Practice was founded in California. So I can imagine that more people started using it in that state, because that's where they were local. And now it has since branched out.
I'm gonna take a deep breath. If you need to take a deep breath, please, please do. Let's move on to what Medicare says. Because what I wanted to do was pull Well, this is great, this data is helpful. But how much does Medicare pay? Because Medicare publicly shares their reimbursement rates, you still have to do a lot of digging, but it is available to you. So I talked about the average cost of therapy based on Simple Practice data. Now I want to talk about like, how much does it cost if I'm using insurance? Well, again, the average cost depends, right? Because when you use insurance, it depends on what your insurance provider reimburses, whether or not the insurance pays whether or not the therapist you're seeing is on panel with that insurance provider. What your copay is, how much you have to pay if you have a high health care deductible. And all of those figures can be really confusing. So again, that's why I went to like okay, what is Medicare reimbursing? Because they're like a nice benchmark to get an idea of what insurance companies should, emphasis on the should, be reimbursing. So according to Medicare in 2021, they reimbursed between $141 and $152 per hour for a one-hour therapy session. So 141 to 152. Okay, and that's pretty close to what Simple Practice found with $120 to $150 per session. Now, your first session, your first therapy session is called an intake session. And in 2021, Medicare reimbursed between $145 and $180. For that first session, that first session is almost always going to be more expensive, because there's so much more paperwork, there's so much more data gathering, you're onboarding, you're doing a ton of digging, both as the clinician and as the therapist for that first session. So it's always going to be more costly. Where the low end and the high-end range differs is that that low-end number, that first number that I shared, is the reimbursement rate for people who have master's level degrees. So that would be someone like me, I'm a master's level social worker. So if I were working with Medicare, I would be reimbursed $141 for ongoing sessions or $145 for intake sessions, okay. The high-end range is the reimbursement rate for people with PhDs and medical degrees. So that would be your psychologist, psychiatrist, your PhD level, folks. So that's gonna be that $152 amount for a one-hour therapy session or $180 amount for that intake session. So let me just like zoom out for a second and go back to that first number. The average hourly rate for a life coach is between $75 and $200. And the general cost of a therapist is between $120 and $150, or $140, and $152. Okay, so kind of all the same, it just seems like the low end is lower for coaches. And that potentially the higher end is also higher from coaches. But again, if you pulled to a city that has a higher cost of living like Miami, Florida, you're looking at more like $175 to $200. And if you need these numbers you like actually literally need to see the numbers, click on the link in the show notes, it will take you to the blog. With each of my podcasts, I do a write-up summary for them. So if you're more of a visual learner, you always have access to those there. And now there is a transcript available too. So if you want to read through the actual transcript, you can do it there.
One more thing before we get on to the case vignettes. Legalities, what are the legalities when you are a client considering hiring a coach or working with a therapist? So I mentioned this on the last podcast where I talked about becoming a therapist or a coach. But it bears repeating that many, many coaches are certified through different organizations and entities that have ethical standards that they have to adhere to. But anybody can call themselves a coach. So it is on the client to do their due diligence to learn about the coach’s education, background, and training that qualifies them to be helpful for the specific topic or area that they provide coaching on. There are some very strong legal distinctions about things that coaches cannot do. So be extra mindful when you're hiring a coach that they are not saying or doing any of the following things. Coaches cannot bill to an insurance provider, nor can clients submit their coaching bills to their medical insurance provider for reimbursement--sidebar here: some companies do pay for coaching or provide a coaching stipend, but this is separate from the coach being able to bill through a medical insurance provider. So maybe your company does provide a coaching stipend, but that's different than a coach saying, Oh, yeah, you can just build this to your insurance. That's not true. They cannot do that. Coaches cannot diagnose, treat, or provide an intervention for any type of mental illness or physical illness, they cannot do that is outside of their scope of practice. They cannot describe their service using any terms that are reserved for psychotherapists within their scope of practice, and they can't provide any service that looks like psychotherapy. What the heck does that mean? You might be asking, let me give you an example. So a coach could say I provide wellness coaching, but they cannot say I provide depression coaching. The former wellness coaching is vague and is not saying that they will diagnose you or treat you. But the ladder depression is a mental health diagnosis. So if you see coaches using diagnoses and their labels or talking about they treat, depression, anxiety, trauma, make sure you get a clear answer because last time I shared that coaches can be trauma-informed, they can be informed on the nuances of neuro divergence and I think they can and should, the more people we have trained in understanding what trauma is and in and in understanding neuro divergence, the better hands down the better. Okay, and so similarly, a coach could say, I provide mental well-being techniques, but they couldn't say I provide mental health treatment. So make sure when you're looking to hire a coach, maybe you just do your due diligence, I guess is what I'll say. Legally speaking, when you're working with a therapist, the therapist is legally bound to practice care within certain jurisdictions. So in the United States, most therapists’ license are state bound, meaning I can practice therapy in Michigan where I'm located, but I cannot practice therapy in California, where I'm not located and not licensed. And so that means they have to adhere to that particular state's board of ethics. Broadly speaking, all therapists have to not engage in dual relationships with their clients. So they can't be seeing a client who's also a friend. They can't be seeing a client who is also you know, their partner's business partner, right? You can't have dual relationships. Most of the time when I say dual relationships, people jump to a sexual relationship. Obviously, that is unethical and should never happen, but that is also a dual relationship. So therapist can not do that. If a client has a complaint about their therapist, they have different places that they can report the therapist to, they can report the therapist to their licensing board or to the state because again, their medical health care providers so they could report them to the States as well. Some legal protections are in place when you work with psychotherapists and I'll list them out below. But when I say psychotherapist, this could be somebody who's a social worker, like me, and when I say a therapist is a social worker, social worker is a therapist, they have to be masters level, you can get a bachelor's degree in social work. But if you have a bachelor's degree in social work, you cannot practice therapy. See what I said, at the start of this, there is no apples to apples, it's so confusing. So anyway, a licensed therapist could be a social worker, a counselor, a psychologist, or a marriage and family therapist. And to make it even more complicated, some psychiatrists who are medical doctors that can practice therapy. So those are all the different titles of people when I say a therapist. So legal protections in place when you work with a licensed therapist are that they have to be credentialed and trained, and they have to have ongoing continuing education to maintain their licensure. They have supervision and oversight by a particular regulatory body or board, as I mentioned earlier, and they're mandated to comply with HIPAA. That's the Health Insurance Portability and Accountability Act, not to be confused with the large animal. And they have to adhere to reporting requirements often called mandated reporting.
All right now they're big breath we're getting we're getting there. We're getting there. How much does it cost? Who should I work with? So who should I work with? If I haven't driven at home enough, if you need mental health care treatment, you need a licensed therapist. Outside of that, I'm going to rile some my therapist friends up, there couldn't be times where a therapist was more appropriate, but there could be times when a coach makes more sense. And this is the time where my therapists are gonna be like, ah, there are times it could go either way. As I mentioned, at the start of this episode, I need to like see and visualize how things are. So I'm going to introduce here three different avatars or vignettes, to help kind of drive home the message of today's podcast, which is like how much it costs and what type of person should work with which type of professional. So these are 110% made up any similarities to a real person living or dead, or actual events is 100,000%. coincidental. Again, these are made-up vignettes, they are not real. They're not based on anybody I know, anybody you know, in any type of similarity is a coincidence. So let's start with person number one. So Aliya is a recent college grad and she's in her first job as a water treatment project coordinator. She describes herself as a classic type A overachiever. She excelled academically in college, sat on the board of an environmentalist group, and interned at a prestigious lab, and her final semester of school. When she was in college, she'd have occasional sleepless nights or moments of panic leading up to exams, but she overall said her mental health and well-being was pretty okay. She comes from a family of what she describes as intense immigrant parents, and suspects a mental illness, but nothing has been discussed, let alone diagnosed or treated. Now that she's in her first job, she's having sleepless nights, two or three days a week, intense moments of panic before meeting with any senior leadership, and having ruminating thoughts throughout the day that she's forgotten to finish all necessary components of her work. She stopped exercising, she occasionally forgets to eat because she's so stressed out. And because she's busy, she's tried doing a few things on her own. She's tried mindfulness apps, journaling, and yoga. But she doesn't really feel relief from what she is calling burnout. Her main complaints are that she feels like she can't keep up the way she used to. She feels on edge all the time, and her sleep is a mess. So this person, in my opinion, this totally made a person should go to therapy. Right? It seems pretty clear for me a therapist that she needs a mental health care. So let's continue the story and talk about how much it might cost her. So Aliya starts in weekly therapy, and it cost her a $30 copay each session for the nine months of working with a therapist every single week. So that's an example of who might work with a therapist and how much it might cost them.
Let's do another Example Quinn. Quinn is an elder millennial in a fine job in a fin tech startup. When he started he found the pace of the job to be really exciting, but now that he's been there several years, and the company has grown, he feels like it's too corporate and he finds himself daydreaming and daydreaming of other work. Outside of work. He loves trivia nights, hiking, and visiting his family. He was in therapy in college, and was diagnosed with mild depression and has been successfully managed with a low dose SSRI. That's a selective serotonin reuptake inhibitor also known as like an antidepressant or an anti-anxiety med for over 10 years through his primary care provider. He wants help figuring out if he needs to be more thankful at his current job or if he should find something else but feels overwhelmed and somewhat whiny for thinking that he wants more out of his work. So where do you think this Quinn should go? Should he go to a therapist to a coach, I think a coach would be fine for him. So in this scenario, Quinn finds a career coach and works with this career coach and a six-week package that costs him $2,500.
Alright, last one. Max is also an elder millennial. Max is mixed race and has been learning more about their ancestry and lineage in recent years. To their knowledge. There isn't a family history of mental illness and they've never been diagnosed with any mental illness, nor have they ever received any mental health treatment. They have a strong interest in incorporating decolonization into their life. And they've played around with Reiki, Tarot, and astrology, and are looking for more guidance around creating a liberatory practice for themselves. So who should Max see? A therapist or a coach. So this is one where I'm like, they could kind of see either they could work with a liberatory coach, or they could work with a therapist who has training on something like intersectional justice, social justice, or somatic therapy. But let's say in this scenario, Max decides to work with a liberatory coach. And this liberatory coach uses elements of Reiki twice per month for $175 per session.
So I hope today's podcast helped you to kind of put together in your mind's eye when a coach makes sense when a therapist makes sense, the times where they overlap and it's a little bit sticky to know who you should work with. Things to keep in mind when you are hiring a coach or hiring a therapist. Kind of general ballpark ranges for the cost of coaching or therapist so that you can make a consensual informed decision as you step into taking care of yourself. Take good care. I'll see you next week.
Transcribed by https://otter.ai