Can a Therapy Practice Waive a Copay?

Last reviewed: October 7, 2026.

Not as a routine practice. Billing a client’s insurance while regularly forgiving their copay or deductible can conflict with payer contracts and, for federal programs, fraud-and-abuse rules. What practices can usually do is give individual, documented relief based on a client’s actual financial need, or see the client privately at a reduced fee instead of billing insurance. Pick one arrangement per client and apply it consistently.

Waiving, delaying and discounting are different things

• Delayed collection: the balance is still owed, on a payment plan or a later date. That is not a waiver.

• Waiver: cost share that is routinely written off or never pursued. This is where the risk sits, even if nobody calls it a waiver.

• Reduced private fee: the client does not use insurance for those sessions and pays a sliding-scale or pro bono rate. Then nothing should go to the insurer.

HHS OIG’s fraud-and-abuse FAQs and its special fraud alert on routine Medicare waivers explain the federal concern and allow non-routine relief based on a good-faith assessment of financial need. Commercial contracts and state rules vary, so this is an audit-risk posture, not legal advice. Separately, clients enrolled as Qualified Medicare Beneficiaries cannot be billed Medicare cost sharing at all; that is a billing protection, not a waiver.

Where reduced-fee arrangements break down

The problems we see are rarely about the policy. They come from the arrangement not reaching billing, or applying to one clinician and not another:

• A client sees a second clinician. A client agreed to a reduced flat fee with one therapist. When they started seeing a colleague, those sessions went to insurance, the deductible had not been met, and the client received a balance several times what they expected. The practice had meant the fee to cover every clinician. Tell your biller the arrangement applies to the client, not the clinician.

• Different treatment by clinician. Collecting cost share for one clinician while forgiving it for another, for the same client, is hard to explain as financial hardship if it is ever reviewed. Decide one client-level arrangement and name one person at the practice who owns it.

• A $0 fee that nobody wrote down. When a clinician decides to see a client pro bono, keep the session fee at $0 for every booking and record the arrangement so billing does not treat it as an error later.

How to set it up with your biller

1. Decide whether the client is self-pay at a reduced rate or still billed to insurance with a documented hardship arrangement.

2. Send the client, the agreed amount, the start date, and which services it covers (individual, group, evaluations).

3. Keep the basis for any hardship decision in the client’s file, and set a date to review it.

4. Apply it to every session the client has, whoever they see, until the practice changes it.

Practices building a sliding scale often reserve a limited number of spots in each tier rather than offering every rate to everyone. For the cost-estimate side of a reduced fee for uninsured or self-pay clients, see the Good Faith Estimate guide.

Frequently Asked Questions

Is a payment plan the same as waiving the copay?

No. On a payment plan the balance is still owed. A waiver is cost share that is forgiven or never pursued.

Can I see an insured client at a sliding-scale rate?

Some practices do, as self-pay without billing insurance for those sessions. What you may charge a plan’s members is generally governed by your participation agreement, so check it first.

Does a hardship arrangement have to apply to every clinician?

We recommend it does. One client-level arrangement is consistent and easier to explain than different treatment by clinician.

Sources

• HHS OIG: Fraud-and-Abuse Authorities FAQs

• HHS OIG: Special Fraud Alerts, Routine Medicare Waivers

• CMS: Qualified Medicare Beneficiary Program