When the client is not the payer: a practical guide to third-party and intermediary payments

Most of private practice rests on a simple arrangement. One person sits with you, that same person pays for the work, and the agreement is between the two of you. Often, though, the money comes from somewhere else. An employer funds a block of sessions through an assistance programme. An insurer authorises six sessions and settles the bill. A company pays you directly for one of its staff. A parent pays for their adult son or daughter, and hopes, understandably, that you will let them know how it is going.

Each of these separates the person you are working with from the person paying for the work. That separation is what makes third-party and intermediary payments a distinct part of practice, and it is where a good deal of avoidable trouble begins. This guide works through the four arrangements you are most likely to meet in UK private practice, the principle that holds them together, and the practical questions worth settling before the first session.

The principle that holds it all together

The person funding the work does not buy access to its content. In most routine therapy arrangements, the payer is entitled only to administrative information: whether sessions were attended, on which dates, and at what cost. They are not entitled to what was said, how the client is progressing, or any clinical detail, unless the client has given specific, informed consent for it to be shared.

On paper this is straightforward. It becomes harder when a parent who has just seen the bill asks a warm, well-meaning question about their child, or when an employer wants to know whether the money is making a difference. Those moments are easier to manage when you have already decided, and already written down, exactly what the payer will and will not receive. Much of what follows is that single principle applied to four different situations.

Employee Assistance Programmes (EAP)

An EAP is employer-funded support delivered through a provider such as Health Assured, Vivup, AXA or HealthHero. The employer pays the provider, the provider refers the employee to you, and the work is short-term and focused, usually a set block of four to eight sessions rather than open-ended therapy. The frame is wellbeing and the ability to function at work, and the model expects you to work briefly and to a clear focus.

If you take on EAP work, you join the provider as an affiliate. A few things are worth knowing before you do:

• Rates sit below typical private fees, and they vary from provider to provider. Some will not pay for late cancellations or missed appointments, so your own terms need to allow for that.
• There is usually a cooling-off period before you can take an EAP client on privately. This catches newer practitioners out, so check the contract before you assume a smooth handover at session six.
• Reporting is part of the work. Brief clinical summaries and outcome measures such as the GAD-7 and PHQ-9 are standard, and those reports stay with the provider. Build the writing time into your diary rather than leaving it as an afterthought.

On confidentiality the model is clear and protective of the client. In standard EAP arrangements, employers typically receive anonymised aggregate information rather than information that identifies individual employees. If a third party asks you for information, the request goes back through the provider rather than being answered directly, and outside the usual legal and ethical exceptions, nothing is released without the client's informed consent.

Set up clearly, EAP work can be a steady income floor while you build a private caseload, and a way for clients who need longer-term work to find you once the cooling-off period allows. Set up loosely, it tends to become poorly paid work with a fair amount of administration attached, and the difference lies almost entirely in how carefully you contract it at the outset.

Private medical insurance

Bupa, AXA, Aviva, Vitality, WPA and others will fund therapy for their members, and being on their networks can bring a steady stream of referrals. The trade-offs are different from EAP work.

To take insured clients you need to be recognised by each insurer separately, and recognition usually depends on registration or accreditation appropriate to your profession and modality, for example with the HCPC, BACP, UKCP, NCPS, or BABCP for CBT. Access usually runs through a GP or a self-referral route, after which the insurer issues an authorisation code for a block of sessions. In many cases, treatment authorisation is required before cover applies, so it is worth confirming before the first appointment.

The points that most often catch practitioners out are financial rather than clinical:

• Insurers frequently cap fees below your standard private rate, and you accept that cap as a condition of recognition.
• The excess and any shortfall are the client's responsibility, not the insurer's. You collect these from the client directly, and the excess can fall due partway through a course of work, at the start of a new treatment year. Identify it early, because discovering a shortfall at the end of therapy is an avoidable and uncomfortable conversation.
• Missed sessions are usually not reimbursable. A late cancellation is typically charged in full to the client, since the insurer will not pay for it.

On the administrative side, Healthcode is the clearing system most UK practitioners use to bill insurers, and connecting it to your practice software lets you invoice in one place and check authorisation codes before they become a problem. Two further things are worth planning for. Payment times vary between insurers, and many practitioners find that active follow-up is occasionally required. Insurers also tend to respond faster to an administrative contact than to the therapist directly, and there is a case for keeping billing at one remove from the clinical relationship.

Employer-paid arrangements (direct)

Sometimes an employer pays you directly, outside any assistance programme. A manager arranges support for a struggling team member, or a small company funds sessions for a senior employee. Because this is far less standardised than EAP work, it needs careful contracting.

Here the boundary is almost everything. An employer who pays directly may assume that paying buys them some visibility, in the way it would if they were commissioning a consultant for a piece of work. It does not. In a typical therapy arrangement, they are entitled to invoicing and, where agreed, confirmation of attendance, rather than clinical detail. Settle in advance, and in writing, what the employer will receive, and make sure the client understands and agrees to that boundary too. Where workplace cover sits behind the arrangement, there may be a set pathway you are expected to follow, so check before you begin.

The parent paying for an adult client

This is the arrangement where the wish to reassure and the duty to protect confidentiality most often pull against each other, and it deserves the most care.

When the client is a minor, the picture is more involved. Consent usually rests with whoever holds parental responsibility for younger children, while an older child may be able to consent in their own right, and your agreement needs to set out who agrees the treatment plan and how confidentiality works within the family. That situation is complex, but it is well mapped.

When the client is an adult, none of that applies. Your adult client holds full confidentiality and gives their own consent. The parent paying the invoice has no automatic right to any clinical information, however generous the gesture and however understandable the worry behind it. Where agreed with the client, they can be told that sessions are taking place and can be sent a bill. They cannot be told how their son or daughter is doing, what is being worked on, or anything discussed in the sessions, unless the client has specifically agreed to it.

The practical skill is managing the paying parent's expectations kindly and early. The call that begins, "I just wanted to check she's actually going," is the moment the agreement you set up at the start either holds or it does not, and it is much easier to point gently back to something you decided together than to improvise a boundary on the spot. Decide before the first session what the parent will receive, tell both the client and the parent, and bill in a way that discloses nothing beyond dates and fees.

Beyond these four, one further arrangement sits slightly outside routine therapy work: solicitor-funded or medico-legal referrals. These often carry their own reporting requirements and should be contracted separately.

The four arrangements at a glance

Keeping the money separate from the therapy

Across all four arrangements the same risk runs underneath. The work of getting paid can seep into the therapeutic relationship and wear at it. A chase for an unpaid excess, a query about an authorisation code, a parent's call about the bill: each one can turn a clinical hour into a transaction.

Two habits protect against this. The first is data minimisation. Whatever leaves your practice and reaches a payer should carry only what that payer is entitled to, so an invoice to a third party shows dates, sessions and fees and nothing that hints at content. Under UK GDPR this is an obligation rather than a courtesy: the ICO expects you to share the minimum necessary, on a clear lawful basis.

The second is separation. Many practitioners find it helpful to keep billing administratively separate from the clinical work, supported by a system that tracks authorisations, excesses and payments so these are not carried in your head. That keeps the financial pressure away from the session itself, and the client is left to experience the therapy while the mechanics of payment carry on at a distance.

Questions to settle before the first session

Whichever arrangement you are stepping into, work through these before you begin:

• Who is my client, and who is my payer? Name both, and be clear that they are not the same.
• What exactly will the payer receive? Attendance, dates, fees, an outcome report? Write it down and have the client agree to it.
• What happens to missed sessions and late cancellations? Decide who is liable and make it explicit, because the payer may not cover them.
• Is there an excess, a cap, a session limit or an authorisation code? Find out before the work starts, not at session five.
• Is there a cooling-off period or a pathway I have to follow? Check the contract, so a handover or referral does not breach it.
• How will I bill, and how will I keep that billing away from the therapy? Settle the mechanics so the financial side never has to surface in the session.

Third-party payments are not difficult because the rules are obscure. They are difficult because they ask you to hold two relationships at once, one with the person you are helping and one with the person paying, and to keep the two from blurring. If you contract clearly at the outset, share only what each payer is entitled to, and keep the financial side from intruding on the work, then who pays for the therapy stays a matter of administration, and the therapy itself is left alone.

The principles in this guide are drawn from professional and regulatory guidance rather than from any single provider or insurer, whose specific terms vary and should be checked in each contract.