You Have More Options Than You Think: Choosing the Right Payment Structure for Your Group Practice
One of the most common things I hear from new Canadian group practice owners is some version of this:
"I'm doing a 70/30 split with my contractors. That's just how it's done, right?"
And I get it. When you're building a group practice, you look around at what other people are doing and you follow the path of least resistance. A contractor agreement with a revenue split feels safe. It's familiar. It's what you've heard others do.
And then the next common thing I hear from existing GPO is some version of this:
“I really wish I hadn’t started with such a high split…I’m not able to cover all my costs now!”
But here's what I really want you to hear today: you have more options than you think. And the option that's right for your practice might look very different from what the person down the street is doing. And that's okay. If you are intentional about what you offer and why it is that, you will be able to answer any questions or negotiations your potential associates may come up with.
Why So Many Practice Owners Default to the Contractor Split
Let's be honest about why the 70/30 (or 60/40, or 80/20) split has become the default in Canadian group practice. It's not because it's the best option. It's because it's the most visible one. That’s the one that potential therapists will tell you they can get down the road, or what is touted as being the only acceptable option to consider.
We hear about it in Facebook groups. We see it mentioned in passing on podcasts. Someone who started a practice a few years ago tells us what they did, and we assume that's the template.
There's also a very real fear of the alternative: the employee model. And that fear makes sense. Payroll, benefits, statutory holidays, records of employment feels complicated and expensive, especially when you're still figuring out your revenue. So the contractor model feels like a safe middle ground.
But here's the problem: a lot of practice owners who set up contractor agreements end up running those relationships more like employment relationships anyway. They set schedules and demand when people will work. They require certain practices and provide supervision for those practices. They direct the work closely. And when that happens, you're taking on the risk of an employment relationship without the legal protections that come with actually structuring it that way.
The uncomfortable truth is that the label you put on the relationship doesn't define what the relationship actually is. The way you manage, direct, and work with the people on your team does.
The Four Structures Worth Understanding
Before you decide what's right for your practice, it's worth actually understanding what options are best for you…not just the one you've heard about most. Here's a plain-language look at what's actually on the table:
1. The Employee Model Your therapist is on your payroll. You control their schedule, set their rates, and direct their work. You're responsible for source deductions, potentially benefits, and all the administrative complexity that comes with employment. It's the most protected structure legally, but also the most expensive and administratively demanding. For many of you growing your first team, it feels out of reach, but it shouldn't be dismissed entirely, especially as your practice scales.
2. The Contractor/Associate Model with a Revenue Split This is the most common structure in Canadian group practice. Your therapist is an independent contractor; you split revenue according to an agreed percentage. The challenge here is that for this to truly be a contractor relationship, the therapist needs to have real independence which includes being responsible for their clients, practicing their own approach, and having control over their schedule. If you're directing their work closely or providing clinical supervision, this structure starts to blur in ways that can create legal risk.
3. The Renter/Tenant Model Rather than splitting revenue, the therapist pays you a flat fee (or a percentage framed as a service fee) for access to your space and supports — things like office space, a booking system, admin support, a profile on your website, a phone line. They collect their own fees from clients and operate as a truly independent business. You're essentially a service provider to them, not a supervisor. This structure requires real independence on their part, and it works best when your practitioners genuinely function as individual business owners.
4. The Service Fee Model Similar to the renter model but often structured as a percentage rather than a flat rate. The therapist collects client fees and pays back a percentage as a fee for the services you provide. The key difference from a traditional split is in the framing and the structure: they are paying you for something, rather than you retaining a portion of their income. This is the model that Kathryn Atkinson of Island Clinical Counselling uses, and she talks about it beautifully in a recent episode of the Empowered to Lead podcast.
The Question Nobody Talks About Enough: What Does Your Budget Actually Need?
Here's where I want to push back a little on how most practice owners approach this decision.
Most people choose a payment structure first, then figure out if the numbers work. I'd encourage you to flip that around.
Before you decide on a split percentage, a flat fee, or any other structure, sit down with your actual numbers. Ask yourself:
What does it cost to run this practice each month? (Rent, software, insurance, admin support, marketing, professional fees, utilities, etc.)
What do I need to pay myself? Not what you're willing to accept, but what you need to cover at home and makes this sustainable for you long-term.
What does it cost to support one therapist on your team? (Their portion of overhead, admin time, supervision if applicable, onboarding.)
What does that therapist need to earn to feel well-compensated and stay?
When you add all of that up, you'll have a much clearer picture of what payment structure actually makes sense. And you might find that the 70/30 split you assumed you'd use doesn't actually cover your costs, or you may find that a service fee model works better for where you are right now.
This isn't just a start-up exercise, either. Your numbers will change as you grow. A structure that works when you have three therapists might not work when you have ten. Building in the habit of revisiting your financials regularly is one of the most important things you can do as a practice owner.
Knowing Your Value Matters Too
There's another piece to this that doesn't get talked about enough, and it has nothing to do with spreadsheets.
You have to believe that what you're offering has value.
Whether you're charging a service fee, taking a revenue split, or billing for rent — the therapists who work with you are getting something real. They’re getting you and your personality and values. They're getting a brand they didn't have to build. Administrative support they don't have to hire. A booking system they don't have to pay for. Referrals. Community. Leadership. A space that's been thoughtfully set up so they can walk in and do their best work.
That has value. Real, tangible, monetary value as well as emotional and cultural.
When practice owners undercharge or feel sheepish about their split percentage, it's often because they haven't fully reckoned with how much they're actually offering. Getting clear on that, being able to articulate your value clearly and confidently, changes how you show up in this role.
And the flip side of this is equally important: when your therapists understand what they're getting and genuinely value it, the structure of your agreement almost becomes secondary. The relationship is grounded in mutual benefit. That's what you're actually building toward. And it’s worth waiting for.
There's No Cookie Cutter Answer Here
If there's one thing I've learned from talking with group practice owners across Canada, it's that there is no single right answer. As many people as I work with there are as many different ways there are to run a group practice. I love it! The structure that works for someone in a downtown Vancouver multi-disciplinary clinic might be completely wrong for someone building a practice in a small northern community. The model that felt right at year one might need to evolve by year three.
What matters is that you make an intentional choice — one that's grounded in your actual numbers, your values, your vision for the kind of practice you want to run, and the kind of relationships you want to have with the people on your team.
Don't choose a payment structure because you heard someone else do it. Choose it because you understand it, it works for your business, and it reflects how you actually want to show up as a leader.
Want to Hear What This Can Look Like in Practice?
On a recent episode of the Empowered to Lead podcast, I sat down with Kathryn Atkinson — founder of Island Clinical Counselling on Vancouver Island — and she walked through exactly how she structured her practice, why her legal team guided her toward a service fee model, and what she's learned about growth, investment, and leadership along the way. It's a really honest conversation and I think you'll take a lot from it.
Listen to Kathryn Atkinson’s Empowered to Lead episode here.
And if you're at the stage where you're trying to figure out what structure is right for your practice, whether you’re new at this or revisiting your numbers, your team, your vision, I'd love to help you think it through. That's exactly the kind of work we do together.
Let’s create a thriving group practice that honours and values your team AND you.
