If you run a private therapy practice, you have likely heard about the No Surprises Act and Good Faith Estimates. But here is the thing: many therapists find themselves overwhelmed by the compliance requirements, unsure whether their current processes actually meet the legal standards. This guide breaks down everything you need to know about creating compliant GFEs, with practical templates and real-world examples that will save you hours of confusion and protect your practice from costly penalties.
What Is a Good Faith Estimate and Why Does It Matter?
A Good Faith Estimate is a written document that provides patients with an advance estimate of expected charges for scheduled or requested healthcare services. Think of it as a financial roadmap for your clients - it tells them exactly what they can expect to pay before they ever walk through your door or log into a telehealth session.
Under the No Surprises Act, which took effect January 1, 2022, all healthcare providers must furnish GFEs to uninsured individuals and those who choose not to use their insurance benefits. This law was designed to protect patients from unexpected medical bills, and mental health providers are absolutely included in these requirements.
For therapy practices, this means every private-pay client - whether they lack insurance or simply prefer to pay out-of-pocket - must receive a GFE before their first session. The estimate must cover all reasonably expected services for their course of treatment, typically spanning up to 12 months. This is not optional; it is a federal requirement that carries real consequences for non-compliance.
Who Must Receive a Good Faith Estimate?
The GFE requirement applies to two categories of patients:
- 1. Uninsured individuals who have no health coverage of any kind
- 2. Self-pay patients who choose not to submit claims to their insurance for mental health services
Note: Clients using insurance benefits through in-network providers are not entitled to a GFE under this rule. However, providing cost transparency is still a best practice that builds trust with all clients.
When Must You Provide a Good Faith Estimate?
Timing is critical for GFE compliance, and this is where many therapists make mistakes. The law establishes specific deadlines based on when services are scheduled, and missing these windows can put your practice at risk.
The regulations are structured around a three-tier system. If a client schedules a service at least 10 business days in advance, you have 3 business days to deliver the estimate. If the service is scheduled between 3 and 9 business days ahead, you must provide the GFE within 1 business day of scheduling. For appointments scheduled with less than 3 business days notice, provide the GFE as soon as reasonably possible before the service - ideally before the session begins.
Scheduling Window Requirements
- 10+ days ahead: Deliver within 3 business days of scheduling
- 3-9 days ahead: Deliver within 1 business day of scheduling
- Under 3 days: Provide before the service is rendered
Acceptable Delivery Methods
- Paper copy: Hand-delivered or mailed to client address
- Email: Electronic delivery with documented client consent
- Client portal: Secure access through practice management system
Required Elements of a Compliant Good Faith Estimate
The No Surprises Act specifies exactly what information your GFE must contain. This is not a situation where you can wing it - missing any required element puts your practice at risk for compliance violations and potential penalties. Let us break down each mandatory component so you can ensure your estimates meet all legal requirements.
Mandatory GFE Elements Checklist
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Patient Information
Full legal name and date of birth of the individual receiving services
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Provider Details
Your name, practice name, NPI number, Tax Identification Number (TIN), and contact information
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Service Description with Billing Codes
Detailed description of each item or service with corresponding CPT or HCPCS procedure codes
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Diagnosis Codes
Expected ICD-10 diagnosis codes if known at the time of scheduling (may be updated after intake)
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Itemized Expected Charges
List of charges for each service, quantity expected, and total estimated cost for the treatment period
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Service Location
Physical address where services will be provided, or clear notation if services are delivered via telehealth
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Required Disclaimer Language
Legally mandated statement explaining that actual charges may differ from estimates and information about client dispute rights
Common CPT Codes for Therapy Good Faith Estimates
When preparing your Good Faith Estimate, you will need to include the appropriate CPT codes for the services you plan to provide. Understanding which codes to use helps ensure accuracy and prevents confusion for both you and your clients.
Most therapy practices regularly use a core set of billing codes. Here are the most commonly used codes in mental health private practice, organized by service type:
Evaluation and Assessment Codes
- 90791 - Psychiatric diagnostic evaluation (no medical)
- 90792 - Psychiatric eval with medical services
- 96130 - Psychological testing evaluation (first hour)
- 96131 - Psychological testing evaluation (add-on)
Individual Therapy Session Codes
- 90832 - Psychotherapy, 16-37 minutes
- 90834 - Psychotherapy, 38-52 minutes
- 90837 - Psychotherapy, 53+ minutes
- 90839 - Crisis psychotherapy, first 60 min
Family and Couples Therapy Codes
- 90846 - Family therapy without patient present
- 90847 - Family therapy with patient present
- 90849 - Multiple family group therapy
Group Therapy Codes
- 90853 - Group psychotherapy (not family)
- 90785 - Interactive complexity add-on
Important Note for Telehealth Services
For telehealth sessions, include the appropriate place of service code: POS 02 for telehealth when the patient is at home, or POS 10 for telehealth when the patient is at a healthcare facility. Add modifier 95 to indicate synchronous telehealth services delivered via real-time audio and video. Your GFE should clearly state that services will be provided via telehealth technology and specify whether audio-only or audio-video sessions are planned.
Sample GFE Calculation for a Typical Therapy Client
Understanding how to calculate a comprehensive GFE can feel intimidating at first. Let us walk through a real-world example that illustrates how to estimate costs for a typical therapy client over a 12-month treatment period.
Consider a new client seeking weekly individual therapy for anxiety. Your session rate is $175 for 45-minute sessions (CPT 90834). Here is how you would structure their Good Faith Estimate:
Sample 12-Month GFE Calculation
Note: This estimate assumes 48 weekly sessions accounting for holidays and vacation. Adjust session frequency based on your clinical recommendations and client preferences.
Penalties and Consequences for Non-Compliance
Failure to provide Good Faith Estimates carries real consequences that can significantly impact your practice. The Centers for Medicare and Medicaid Services (CMS) has enforcement authority under the No Surprises Act, and violations can result in civil monetary penalties of up to $10,000 per violation.
Beyond regulatory penalties, non-compliance creates significant business and relationship risks. Clients who receive bills substantially higher than their GFE can initiate a patient-provider dispute resolution process. If the final bill exceeds the GFE by $400 or more, the client has the right to dispute the charges through a federally administered process.
This dispute process can be time-consuming, may result in reduced payments to your practice, and almost certainly damages the therapeutic relationship you have worked hard to build. Prevention through proper GFE practices is always better than dealing with disputes after the fact.
Warning: Common Compliance Mistakes to Avoid
- Providing verbal estimates instead of proper written documentation
- Missing the required disclaimer language about dispute rights
- Failing to include diagnosis or CPT procedure codes
- Not updating estimates when treatment plans change significantly
- Delivering estimates after the required timeframe has passed
Best Practices for GFE Management in Your Practice
Creating compliant Good Faith Estimates is just the first step. Managing them effectively throughout the therapeutic relationship requires systematic processes and consistent attention. Here are proven strategies from successful therapy practices that have mastered GFE compliance.
Automate Your GFE Process
Practice management software can generate GFEs automatically when new clients schedule appointments. This dramatically reduces administrative burden and ensures no client falls through the cracks. Look for systems that auto-populate your provider information, calculate costs based on expected session frequency, track delivery confirmation, and maintain records for compliance auditing.
Create Documentation Habits
Maintain detailed records of when each GFE was provided and how it was delivered. If a client later disputes charges, this documentation protects your practice and demonstrates good faith compliance efforts. Keep copies of the original estimate, delivery confirmation such as email read receipts or signed acknowledgments, and any updated estimates provided during the course of treatment.
Update Proactively When Treatment Changes
If treatment needs change significantly, provide an updated GFE before the changes take effect. This is not just good compliance practice - it builds trust and prevents misunderstandings. Clients appreciate knowing what to expect financially, and transparent communication strengthens the therapeutic alliance rather than undermining it.
Legally Required Practices
- Written estimate before services begin
- All mandatory data elements included
- Dispute rights disclosure statement
- Timely delivery based on scheduling window
Recommended Best Practices
- Client signature acknowledgment of receipt
- Clear payment policy explanation
- Sliding scale documentation if applicable
- Superbill provision details for reimbursement
Frequently Asked Questions About Good Faith Estimates
Here are answers to the most common questions therapists have about GFE requirements and compliance:
Do I need to provide a GFE for clients who have insurance but choose to pay out of pocket?
Yes. Any client who is either uninsured or chooses not to use their insurance benefits is considered a self-pay patient under the No Surprises Act. If your client has insurance but asks to pay privately without filing claims, you must provide them with a Good Faith Estimate before services begin.
What if I do not know the diagnosis before the first session?
This is common in therapy practices. For the initial GFE before an intake evaluation, you can note that the diagnosis is to be determined pending clinical assessment. Once you establish a diagnosis after the evaluation, provide an updated GFE that includes the appropriate ICD-10 codes.
How often should I update a Good Faith Estimate?
Update the GFE whenever there is a significant change in the expected services or costs. This includes changes in session frequency, adding new service types like family sessions or group therapy, fee increases, or changes to the treatment plan that affect the total estimated cost. A good rule of thumb: if the changes would increase the estimate by more than 10 percent, provide an updated GFE.
Can I provide the GFE electronically or does it have to be on paper?
Electronic delivery is acceptable as long as the client has consented to receive documents electronically. Email, secure client portals, and other electronic methods all satisfy the delivery requirement. Document that you obtained consent for electronic delivery and keep records of when the GFE was sent and received.
What happens if my actual charges end up being higher than the GFE?
If your final charges exceed the GFE by $400 or more, the client has the right to initiate a patient-provider dispute resolution process. This is why accurate estimation and proactive updates are so important. If you anticipate charges increasing, provide an updated GFE before the additional services are rendered to reset expectations and protect your practice.
Does the GFE requirement apply to telehealth sessions?
Absolutely. Telehealth sessions are treated the same as in-person sessions under the No Surprises Act. Your GFE for telehealth clients should specify that services will be delivered via telehealth, include the appropriate place of service code, and use the correct telehealth modifiers on your CPT codes.
Key Takeaways: Good Faith Estimate Essentials
- Mandatory compliance: All uninsured and self-pay clients must receive a written GFE before services begin - no exceptions.
- Timing matters: Deliver within 1-3 business days of scheduling depending on how far out the appointment is booked.
- Include all required elements: Patient info, provider details, CPT codes, diagnosis codes, itemized charges, location, and dispute rights disclaimer.
- Document everything: Keep records of when each GFE was delivered and how, plus any updates provided during treatment.
- Update proactively: When treatment plans change significantly, provide an updated estimate before new charges are incurred.
- Penalties are real: Non-compliance can result in fines up to $10,000 per violation plus client disputes if charges exceed estimates by $400 or more.
Good Faith Estimates may feel like another administrative burden in an already paperwork-heavy profession. But when implemented properly, they actually strengthen your practice by building trust with clients, preventing billing disputes, and demonstrating your commitment to ethical, transparent care.
The therapists who thrive with GFE compliance are those who build systematic processes, automate where possible, and view transparency as a therapeutic value rather than just a legal requirement. Your clients deserve to understand their financial commitment, and your practice deserves protection from compliance risks. A well-crafted Good Faith Estimate delivers both.
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TheraFocus Team
Compliance Specialists
The TheraFocus team is dedicated to empowering therapy practices with cutting-edge technology, expert guidance, and actionable insights on practice management, compliance, and clinical excellence.