Malpractice lawsuits and state licensing board complaints are two professional liability risks that counselors face in their practice. But by learning from the experiences of their peers, counselors can identify risk control strategies they can employ to help mitigate these risks.
This case study involves a licensed marriage and family counselor insured through the HPSO program. At the time of these events, the counselor had over 25 years of experience and was working in an outpatient mental health treatment setting.
The insured began counseling two minor children who began having difficulty regulating their behavior and feelings of grief following the death of their father. The initial client intake forms were completed by their mother and only listed the children as the clients for family counseling, even though the children were seen both together and separately, and the mother was always present.
Within six months of initiating the counseling relationship with the children, the counselor began occasionally scheduling individual counseling appointments with only the mother. The first few sessions focused on strategies the mother could use to support her children’s grieving process, but these sessions soon evolved into more far-reaching discussions regarding the mother’s grief and trauma. However, the counselor never completed any client intake forms with the mother for individual counseling and did not maintain any healthcare documentation related to these appointments, such as assessment, treatment planning, or progress notes, because the counselor did not consider the mother to be her client.
About two years into the counseling relationship, after several individual counseling sessions with the mother, the mother and counselor entered into a business relationship. The counselor agreed to invest in a partial ownership stake in the mother’s business in exchange for a portion of her profits. The counselor never considered the mother a client and therefore didn’t believe there would be a conflict with entering into a business relationship with her.
Over several months, the business relationship soured between the mother and the counselor. The mother believed the counselor owed her money and made several attempts to collect. The counselor refused to pay the mother for a variety of reasons.
Once the business relationship between the counselor and the mother became strained, the counselor refused to continue seeing the mother for individual therapy sessions and would not allow the mother to attend or participate in the children’s therapy sessions. The counselor also failed to respond to the mother’s multiple requests to refer her and her children to another therapist for further treatment.
The mother filed a professional malpractice lawsuit and state professional licensing board complaint against the insured counselor for abandonment and extending counseling boundaries. The mother alleged that she and her children experienced emotional distress due to the counselor’s actions, which interrupted their treatment. The disruption in the counseling relationship caused the children’s symptoms to intensify, requiring additional mental health treatment. Additionally, due to the emotional distress caused by her children’s emotional state and the conflicts with the counselor, the mother was unable to spend as much time working and lost income.
Allegations against the counselor included:
- Abandonment and client neglect;
- Failure to obtain client’s consent for the change from family to individual counseling;
- Failure to maintain professional standards;
- Entering into a nonprofessional relationship with a client;
The licensing board requested the counselor’s client healthcare records on the children and the mother, billing records, and the counselor’s personal mobile phone records. As part of the investigation, the licensing board also conducted interviews with the mother, the counselor, and the counselor’s staff.
After reviewing the healthcare and billing records, and interviewing the mother and the counselor’s staff, the board concluded that the mother was a client. The board asserted that the role between the mother and the counselor changed from an evaluative role to a therapeutic role shortly after the counselor began working with the minor children. The board decided that the counselor provided treatment to the children and mother and failed to safeguard the integrity of the counselor–client relationship. The board felt that the healthcare records on the mother and the children were incomplete, insufficient, and failed to meet professional documentation standards. The board also concluded that the counselor effectively abandoned the mother as a client by refusing to continue to see her for individual and family counseling sessions and failing to refer her to another counselor for further treatment.
The counselor entered into a consent agreement which required her to complete 80 hours of ethics continuing education and placed her on probation for two years, which required that her practice be supervised by a board approved marriage and family counselor.
With the board’s findings against the insured, it was determined that the likelihood of a defense verdict in favor of the counselor in the professional malpractice lawsuit would be less than 10 percent. Therefore, the decision was made to pursue mediation in the professional malpractice lawsuit on behalf of the insured counselor in the hopes of settling the case before trial.
Mediation resulted in a settlement of the claim for the children’s and mother’s emotional injury and additional counseling required. Total incurred for the professional liability claim, including the settlement and defense expenses, was approximately $178,000 and took almost six years to resolve.
Cost to defend the counselor related to the board complaint was greater than $13,000. This amount does not include the out of pocket costs the counselor incurred related to the required CE and supervision.
(Note: Monetary amounts represent only the payments made on behalf of the counselor.)
Risk Management Recommendations
This case touches on some top areas of liability for counselors, according to HPSO/CNA analysis of counselor professional liability claims.
First, the counselor in this case failed to identify which individuals were their client
for family and individual counseling. The counselor should know if the client is the child/adolescent, the child/adolescent plus parent(s), one/both parents. Knowing the reasons that brought the child/adolescent to therapy can provide assistance on identifying the client or clients. These types of recommendations should be made by a qualified, independent mental health professional.
- In situations of couples and family counseling, counselors, clearly define who is considered “the client” and discuss expectations and limitations of confidentiality.
- In the absence of a treatment agreement during couple or family therapy, consider all individuals involved to be the client.
- Periodically review treatment agreements with care plans to determine if the counselor-client has changed and if so, update all documents as needed.
Regardless of the reasons a client presents for therapy, the counselor must establish ground rules at the onset. This includes obtaining all necessary releases prior to starting treatment. In the case of a child/adolescent treatment, the counselor should establish parental rights and attain copies of court orders of guardianship in cases of divorce or custody disputes, as necessary. If a parent/guardian insists on being present during their child’s therapy sessions, ensure that the parent/guardian understands that the client is the child/adolescent, not the parent/guardian.
The counselor in this case also failed to maintain professional boundaries
with their client.
- Maintain appropriate boundaries with clients and know and comply with the ACA Code of Ethics. In addition, follow state-specific laws and regulations related to professional conduct, applicable ethics codes of state and/or local professional organizations, as well as requirements of relevant licensure/certification/disciplinary boards.
- Remember that the counselor is solely responsible for maintaining appropriate boundaries in the counseling relationship, and that client consent for sexual, business, personal and/or social relationships does not exempt the counselor from this professional duty.
- Manage client transference and/or countertransference with appropriate counseling relationship, and that the client consent for personal and/or social relationships does not exempt the counselor from this professional duty. If transference and/or countertransference cannot be appropriately managed within the counseling relationship and becomes an obstacle to achieving treatment goals, cease treatment and encourage the client to seek counseling with another professional.
- Avoid multiple relationships with clients, their significant others and their family members. Such multiple relationship scenarios may involve declining invitations from the client to participate in social/personal/family activities or others outside of the treatment setting. As noted in the ACA Code of Ethics, Section A.6.d., when there has been a role change in the professional relationship, obtain informed consent from the client and explain their rights to refuse services related to the change. Clients must be fully informed of any anticipated consequences (e.g., financial, legal, personal therapeutic of counselor role changes).
- Terminating the client does not waive or eliminate the prohibition against a personal/business relationship. If it is necessary to terminate the counselor-client relationship, record all supportive actions taken to assist the client in understanding the reasons for termination and obtaining alternative treatment.
- Refrain from contact with clients who are no longer in treatment. If unintentional contact occurs, maintain proper professional boundaries.
The counselor in this case also abandoned and neglected the client by failing to appropriately terminate and/or refer the client another qualified counselor for ongoing therapy
- Do not abandon or neglect clients in therapy. A counselor should make an appropriate arrangement for the continuation of treatment, when necessary.
- Refrain from referring prospective and current clients based solely on personal held values, attitudes, beliefs, and/or behaviors. If a client declines the suggested referral, the counselor may discontinue the relationship after following appropriate termination processes.
- When transferring or referring clients to another practitioner, ensure that the appropriate clinical and administrative processes are completed, and open communication is maintained with not the client and practitioner.
Finally, and crucially, the counselor in this case failed to maintain appropriate documentation
- Know and comply with documentation requirements in accordance with state-specific practice acts, laws, and regulations (for example, Department of Health and/or Department of Mental Health, Child and Family Services, Department of Transportation, etc.), as well as prevailing standards of care and the policies of licensing bodies and employers or group practices. When more than one requirement applies, adhere to the most stringent policy.
- Provide accurate, complete and current documentation, in order to enhance continuity of client treatment by another authorized counselor or healthcare provider. Documentation should support the treatment plan and satisfy third-party billing requirements.
- A complete and accurate clinical record presents the strongest defense against legal and licensing actions, document the following information, at a minimum:
- The clinical decision-making process, as well as the client’s diagnosis, service plan, response to treatment, results of diagnostic testing and/or consultation findings, and assessments of the client’s risk of being a danger to self or others.
- Session notes, including review and revision of problems and/or treatment plan, the client’s response and any change in diagnosis.
- Telephone encounters (including after-hours calls), documenting the name of the person contacted, advice provided, and actions taken.
- Dated and signed receipts of test results, referrals, and consultations, including a description of subsequent actions taken.
- Referrals for medical assessment and/or for the prescribing and monitoring of psycho-active medications.
- Educational materials, resources, or references provided to the client.
- The client’s informed consent for proposed treatment and testing.
- Missed appointments, including all efforts to follow up with the client.
- Discussions of privacy, confidentiality of personal information and possible exceptions to those protections.
- Signed and dated consent forms for release of information, if necessary, to client-authorized parties, child welfare organizations in the case of suspected child abuse, law enforcement personnel if the client is deemed to be a risk to self or others, and a court of law in response to an official court order or subpoena.
- Counseling of noncompliant clients and/or responsible parties regarding the risks resulting from their failure to adhere to medication and treatment regimens.
American Counseling Association (ACA). (2014). ACA Code of Ethics
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