Avoid Fraud When You Diagnose

Here’s a common scenario: A new client comes in, obviously in need of your services. You want them to be able to use insurance because you know how important therapy is and want to make sure they get what they need. So you diagnose them with something —anything— to make it happen. 

You think you’ve done them a favor, but what you’re really doing is committing FRAUD.

It happens every day, and most therapist don’t even realize they’re breaking the law. I’m here to help you avoid fraud! That’s why I want to talk about the major mistakes people make when giving a diagnosis for insurance. 

Watch the video to find out more or keep reading below…

The first thing to remember is that any diagnosis you give, for any reason, must be real and accurate. So get out that DSM and make sure!

Even when I was diagnosing people every day as part of an agency job, I always double-checked the criteria for every diagnosis, every time. Why? Because even when we think we know a diagnosis inside and out, the DSM offers crucial guidance to getting it right. And unless you have a photographic memory, you probably don’t remember every single component of every diagnosis. 

The two big mistakes people make in a diagnosis that often lead to fraud are over-diagnosing and under-diagnosing. 

Let’s look at a common diagnosis to see how this works in practice: Adjustment Disorder.

Under-diagnosing


In under-diagnosing a client, you’re probably forgetting the ‘rule of severity.’ One of the main criteria for adjustment disorder is that if someone meets the criteria for another, ‘more significant’ disorder, you *must* diagnose them with the other disorder.

For instance, you may have a new client who fits the criteria for Bipolar Disorder and sought you out while in the middle of a Major Depressive Episode. If that’s the case, you are not allowed either legally OR ethically to diagnose them with Adjustment Disorder.

Sometimes we therapists worry about documenting something like Bipolar Disorder, concerned the diagnosis might do harm to our client.

In those cases, our job is to remember how important it is for our clients to have accurate medical records for their own health, as well as for us to be doing the best job possible providing the services our clients need. We fail at both of those if we don’t diagnose properly.

Over-Diagnosing


Over-diagnosing looks like this common scenario: a client comes to you in major distress, even though they don’t meet the criteria for any specific disorder. They could be experiencing a major transition or experiencing stress related to job loss, a major move, etc. In cases like this many therapists will ‘fudge’ a diagnosis; after all, everyone meets the criteria for adjustment disorder, right?

Well as much as I like fudge to eat, it’s a bad idea for diagnoses!

You don’t want to give someone a mental health diagnosis if they don’t actually meet the criteria, because you have no idea how it might impact them in the future. It’s just as bad as under-diagnosing to avoid what you might consider a ‘harmful’ diagnosis.  

Basically, therapists should never (ever!) give a diagnosis to a client unless they meet the criteria.

If you want to keep the insurance companies happy, clients happy, and yourself protected, diagnosis is just one part of what you need to consider for clients who use insurance. Click here to check out everything you need to know about insurance and medical necessity.