Understanding Therapy Insurance Benefits
- Skyline Psychotherapy & Assessment Services, PLLC
- Jul 18
- 6 min read
Navigating the world of therapy can be overwhelming at first, particularly when it comes to understanding costs and insurance coverage. Research shows that therapy is effective in reducing anxiety, depression, and other symptoms for about 75% of those who engage in at least 8 sessions. One of the major barriers to seeking (and following through with) treatment is the burden of cost. Read on to learn about aspects of insurance coverage. We hope that this helps you to make informed decisions about your mental health and options.
Using Your Insurance Benefits for Therapy
Therapy can be seen as an investment in your mental health and, like any investment, there are costs associated. Insurance coverage can alleviate some of this burden. With the right plan, sessions can become significantly more affordable, allowing individuals the opportunity to prioritize their mental well-being without facing heavy financial burdens.
According to a recent study by the National Institute of Mental Health, approximately 1 in 5 adults in the U.S. experiences some form of mental illness each year. This statistic underscores the need for accessible mental health treatment. Insurance coverage for therapy not only reduces the overall cost but can also facilitate greater use of services.
Understanding Different Types of Mental Health Coverage
Insurance policies vary a great deal. Common types of mental health coverage include:
Employer-Sponsored Health Insurance: Many individuals receive health insurance through their jobs. This often includes mental health services, but specific coverage can depend on the employer’s plan. Employer-sponsored coverage, such as a PPO plan, often includes an option to not only work with a provider that takes your insurance but also to work with a therapist that does not take your insurance and can provide the necessary documentation that you would need to submit to your insurance for reimbursement after you have paid for your session up-front. More on this later!
Marketplace Insurance: Insurance purchased through government-run health marketplaces can provide mental health coverage. You may qualify for subsidies, making it more affordable. Out-of-network reimbursement is often an option with marketplace plans, too, but they are more likely to require you to pay enough in session fees to satisfy your insurance deductible first.
Medicare and Medicaid: These government programs offer in-network mental health coverage for eligible individuals, including specific therapy options.
EAP programs: These typically cover therapy sessions with in-network providers but often limit the number of visits or types of therapy they will cover.
Before diving into therapy, it is crucial to understand what type of insurance you have and the specific benefits available to you.
Therapy within Your Insurance Network
Many insurance plans cover therapy, but the extent of coverage can differ. Here are some aspects of in-network therapy to be aware of:
Finding an in-network provider: "In-network" is the term that insurance companies use for therapists that have signed a contract with them and who accept the insurance company's payments for sessions, leaving the client to pay the co-pay (or to pay the whole cost temporarily, until they meet their insurance deductible). Insurance companies often have a preferred list of providers, which is available on an insurance website or portal. In-network therapists can also be found by filtering the results on online directories, such as Psychology Today, or by conducting your own search via Google or other search engines.
Insurance companies can dictate some of the terms of your treatment:
Session Limits: Some plans may limit the number of therapy sessions you can utilize per year. Knowing your plan's limitations before starting therapy can help you pick a cadence that works for you.
A diagnosis is required: To submit an insurance claim, your therapist would need to enter a diagnosis and share it with your insurance company. If there is no diagnosis, the claim would likely be rejected as soon as it was submitted.
Pre-Authorization Requirement: Certain plans might require pre-authorization for therapy or assessment services. Understanding your policy's requirements can prevent surprises.
Therapists can verify your benefits before you start but this is not an "exact science." Ask your therapist what your coverage seems to be and whether they can determine the part that you would be responsible for before you start treatment.
A young adult sits for his first therapy session.
Common Insurance Terms
Understanding some terminology can help to demystify the process. Here are a few key terms:
Deductible: This is the amount you pay before your insurance starts covering therapy costs. Not all plans require you to satisfy your deductible before they start covering your costs, but some do. Check out your insurance portal to see what your deductible is and how close you are to reaching the required limit.
Co-payment: A co-pay is a fixed amount you might be required to pay for each therapy session. Co-pays are typically small, such as $25-$50.
Co-insurance: This is your share of the costs after you've met your deductible, often described as a percentage of the total session cost. For instance, you might be required to pay 10% of the overall treatment cost, rather than a fixed amount like a co-pay.
Out-of-Pocket Maximum: The total amount you will pay for covered services in a year before your insurance pays 100% of the costs (which means no co-pay or coinsurance either!)
Becoming familiar with these terms can empower you when discussing your coverage with your insurance provider or therapist.
Therapy Outside of Your Insurance Network
An estimated 1/3 of private practice therapists are not in-network with any insurance companies. There are numerous reasons why so many therapists remain completely out-of-network, citing financial, administrative, and ethical concerns. Here are some key points that many therapists have to consider:
Lower rates: Insurance companies have historically devalued mental health treatment, as compared to medicine. Therapists who sign a contract with insurance companies agree to accept the rate that the insurance company chooses to pay and that rate is almost always much lower than the bill that the therapist submits. For some therapists, it doesn't feel fair or sustainable to accept those lowered rates.
Limits on care: Insurance companies require a diagnosis for the service to be covered and can deny coverage if the particular diagnosis isn't a "billable" one. They can also limit the number of sessions covered or require therapists to submit extensive documentation to prove that the treatment is necessary.
Privacy and Autonomy: It should be noted that taking insurance can mean less privacy for clients. Insurance paperwork is often sent to clients' homes and this can reveal to other members of the household that the client is receiving therapy services.
Understandably, many therapists would rather maintain a sense of freedom from the oversight of insurance networks and decide how they would like to conduct their own services. But hope for affordable treatment with an out-of-network therapist is certainly not lost!
Out-Of-Network Reimbursement
So, you've found a highly recommended therapist that seems like a perfect fit, but they don't accept your insurance plan. Don't keep scrolling just yet! It is important to know about out-of-network reimbursement, an option available to many potential therapy clients.
How does it work? Therapists who are not in-network with an insurance company set their own rates and, yes, those rates are often higher than what the insurance company would typically pay. Clients are asked to pay the full cost of the session, usually on the day that they are seen, and can use a credit, debit, or HSA/FSA card. After paying, you can request the documentation that you would need to submit to your insurance company to request some of that money back. As long as your plan includes out-of-network coverage, all you'd need to do is start a claim and attach the document sent by your therapist, which is called a "Superbill." A word to the wise: resubmit or repeal any denials that you receive. There can be administrative errors with out-of-network claims.
Here are some steps that you can take toward receiving out-of-network reimbursement:
Ask out-of-network therapists for their rate and which forms of payment they accept.
Request that they send Superbills to you, either directly after you've paid or at some regular frequency, such as once per month.
Check with your insurance company to see what your out-of-network coverage might be, or use a third-party service to verify your benefits (or even to submit those out-of-network claims for you). Our "cost of treatment" page has an out-of-network benefits checker powered by Mentaya.
Conclusion
Understanding and managing your coverage can empower you to prioritize your mental health without the added stress of unexpected costs. From understanding the various types of insurance to navigating terminology, having a robust knowledge base sets you on a path toward better well-being.
Incorporating mental health care into your routine isn't just a form of self-care; it's an investment in your overall quality of life. Be sure to explore all of your options and maximize the benefits available to you, so you can focus on yourself and getting closer to thriving!
If you'd like to begin prioritizing your mental health, don't hesitate to reach out to a therapist or our administrative assistant at Skyline Psychotherapy & Assessment Services, PLLC.
At Skyline, our providers are in-network with Aetna and select providers are in-network with Blue Cross Blue Shield, Quest, and the EAP program Modern Health. We are out-of-network with other insurance plans but are more than happy to provide regular superbills for your out-of-network reimbursement claims.
We're ready whenever you are.
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