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Opportunities & Challenges with Opening a Non-Profit Ketamine Clinic

The mental health industry is undergoing seismic shifts. Psychedelic medicinal treatments, such as Ketamine Assisted Therapy (KAT) and Ketamine Assisted Psychotherapy (KAP), have garnered significant attention for their ability to treat a variety of mental health conditions when other treatments have failed. Furthermore, the COVID-19 pandemic had devastating effects on people’s mental health. These factors drove up demand for breakthrough therapies like KAT and KAP and propelled it to the mainstream. Today, you can find conventional therapists and medical practitioners offering ketamine therapies, as well as a proliferation of new clinics popping up in every state across the U.S.

The unfortunate irony is that those who benefit the most from ketamine therapies can rarely afford it. While legal for medicinal use, Ketamine’s risk exposure and “off-label” status cause many health insurance companies to deny treatment reimbursements. As a result, most ketamine clinics operate largely as cash-only clinics. The reality is, there’s a disproportionate amount of people suffering from severe depression, anxiety, and PTSD who are on disability and can’t afford to shell out $300 to $1000 [on average] per session. All of this suggests that the industry is in need a new visionary model. .

Non-Profits Are Paving the Way for Affordable Access to Ketamine Assisted Therapy

R&A PSYINS offers non-profit ketamine clinics essential Business Liability Insurance

Establishing a non-profit ketamine clinic requires specialized insurance coverages to ensure your success, sustainability, and compliance with regulations. Below are the essential insurance coverages you need to protect your organization.

By working with an independent broker like R&A PSYINS, who specializes in the psychedelic medicinal/therapy industry, we can help you identify the right policies, negotiate coverage terms, and ensure your non-profit clinic is adequately protected.

  1. General Liability Insurance: Whether you offer Ketamine IV Infusion Therapy or KAP, General Liability Insurance is the most essential coverage your non-profit clinic needs for protection against accidents, property damage, or injuries that may occur on your premises. It can also protect against claims involving slander, libel, and copyright infringement. Your General Liability policy acts as a safety net, covering legal defense costs, settlements, or judgments.

  2. Professional Liability/Errors & Omissions (E&O) Insurance. Professional Liability Insurance/E&O, also known as Malpractice Insurance, covers claims arising from alleged professional negligence, misdiagnosis, or improper administration of ketamine treatments. It offers financial protection for legal defense costs, settlements, or judgments. In an industry like psychedelic medicine, this type of insurance is critical. Patients require precise dosing and treatment, and there is no room for error. Given the unique nature of ketamine therapy, having this coverage is essential to protect your clinic and staff from costly legal claims.

  3. Product Liability Insurance: From an insurance perspective, the product risk exposure is substantial due to the possible side effects of ketamine. This type of coverage is designed to protect your clinic from claims that can happen anywhere along the supply chain, including product contamination, mislabeled products, false advertising, or defective products. With proper coverage, your insurance company - not your non-profit - will pay for damages and legal expenses if you are sued, up to your policy limits. Your Product Liability policy will also cover any medical expenses for those who are harmed by a ketamine treatment.

  4. Cyber Liability Insurance: Ketamine clinics store sensitive patient information, such as medical records and payment details, in electronic formats. A single breach can compromise patient privacy and lead to legal liabilities. Cyber Data Liability Insurance helps mitigate financial losses resulting from such incidents, covering expenses related to data recovery, legal fees, and notification to affected individuals. By securing this coverage, ketamine clinics can enhance their cybersecurity measures and safeguard patient confidentiality.

  5. Directors and Officers (D&O) Insurance: Most non-profit ketamine clinics are overseen by a board of directors. A D&O policy is the only type of insurance that can protect your Board from legal claims related to actual or alleged wrongful acts in managing the company. In the event of litigation, a comprehensive D&O policy will cover legal fees, fines, settlements, and other related costs.

Navigating the Coverage Process

Establishing a non-profit holds the promise of providing individuals with alternative avenues of mental health treatment at more affordable prices than private clinics. While the potential benefits of ketamine therapy are promising, navigating insurance coverage for a non-profit ketamine clinic can be difficult. It is important to know that your non-profit ketamine clinic can be insured.

Given the evolving landscape of mental health treatments and the relative newness of ketamine therapy, working with an insurance broker experienced in psychedelic medicine is critical. R&A PSYINS is at the forefront of this new psychedelic movement providing ketamine clinics and licensed practitioners with custom Business Liability Insurances. If you have questions, or would like to schedule a free consultation, please click here or call (954) 790-6604.


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