Is Therapy Covered by Insurance?

Types of Insurance That Cover Mental Health

In 2008, mental health parity requirements ensured that mental health was covered at similar levels as other health insurance benefits. The Affordable Care Act went even further to enforce that mental health and substance abuse treatments be included as part of health insurance coverage. Medicare also provides extensive mental health insurance benefits.

Here are the types of private and public insurance that include mental health coverage:

Employer-Sponsored Health Insurance

Employers with over 50 full-time staff are mandated by the ACA to provide health insurance to employees; if you’re working for a bigger firm, the large group plan is often the best place to get your mental health insurance.

Smaller businesses can get small group health insurance, although it’s more costly as they don’t have the negotiating power of larger employers. That makes large group plans the most affordable as rates are lower and the employer is required to pay a portion of the premium. With small group plans, the employer has a choice of how much they’ll pay towards premiums, which is often better than an individual plan requiring you to pay the entire insurance premium yourself.

Health Insurance Marketplace

Programs on the health insurance marketplace tend to be private insurance that offer versions of their plans through the government’s online marketplace. These plans must cover mental health services through parity with physical health coverage.

All marketplace insurance plans must cover:

• Behavioral health treatments, like therapy and counseling
• Inpatient mental and behavioral health treatment
• Substance use disorder treatment

These covered services are vague and the level of coverage could differ greatly between plans found on the marketplace.

Children’s Health Insurance Program (CHIP)

Children’s health insurance program (CHIP) provides federal and state-funded insurance coverage to children in need. These plans tend to be quite comprehensive and provide more than a dozen covered services to children and their families.

Some covered services include:

• Mental Health Crisis Intervention
• Marriage and Family Counseling
• Mental Illness/Substance Use Disorder
• Drug and Alcohol Outpatient
• Behavioral Specialist Consultation
• Drug and Alcohol Intensive Outpatient
• Drug and Alcohol Medically Monitored Detoxification

Medicaid

As a government-funded insurance plan usually reserved for people with disabilities or low income, Medicaid is an inclusive option. These plans usually cover all evidence-based treatments and will have little to no copay or deductible.

Medicare

Medicare is a federally-funded insurance option that is usually available to older people and people with disabilities. Like Medicaid, this form of insurance will cover the majority of mental health and substance use services. Unlike Medicaid, Medicare tends to have additional co-pays, deductibles, and premiums that affect the overall out-of-pocket expense.

Blue Cross Blue Shield

Blue Cross Blue Shield (BCBS) is a national private insurance carrier that offers a full range of physical health and mental health services. As long as the service is medically necessary and provided by licensed professionals, BCBS should cover usual mental health and substance use services.

Kaiser Permanente

Kaiser Permanente is an integrated healthcare provider based in California. This system is unique because they offer insurance coverage to their range of treatment centers. If someone has Kaiser Permanente insurance, they will most often need to receive treatment at a Kaiser Permanente facility. The benefit is a tightly-coordinated care plan, while the cons involve limited access to outside treatments.

What Mental Health Treatments Are Covered By Insurance?

ACA-compliant mental health insurance coverage and most employer insurance plans cover individual and family therapy, mental health, and substance use disorder screenings, outpatient psychiatric care, medication, and hospitalization services.

Specific mental health services covered by ACA-compliant insurance plans include:

• Mental health evaluations for you, your covered spouse, and dependent children
• Children’s behavioral counseling and parent support for issues like ADHD and autism
• Psychotherapy for diagnosable mental health issues like anxiety, depression, and bipolar disorder
• Anti-addiction and substance misuse prevention medications
• Couples and family counseling for behavioral and mental health issues
• Prescription drugs for the treatment of mental health disorders
• Psychiatric hospitalization, on par with what’s offered for medical hospitalization
• Treatment for substance use disorders, both in-patient and outpatient
• Home mental health visits (if home medical visits are offered in the plan)

Are Psychiatrists Covered by Insurance?

Yes, psychiatrists are typically covered by insurance. Psychiatrists are medical doctors who provide specialized mental health care focused on assessment and prescription of medications. Some psychiatrists may offer therapy sessions, but they will often focus on shorter medication-focused appointments.

Does Insurance Cover Online Therapy?

Whether online or in person, therapy services are generally covered by insurance. The insurance carrier may have certain rules and regulations pertaining to which clinicians and online services it covers. People interested in online therapy providers should take care to ensure the online platform accepts insurance, as many require client payment or subscription plans.

Mental Health Care That May Not Be Covered

Private insurance may not cover the costs of non-medically necessary treatments or behaviors outside of what’s identified in the Diagnostic and Statistical Manual of Mental Disorders (DSM–5). The costs and coverage provided by your mental health insurance can vary significantly based on the medical insurance plan type you choose. Some health insurance plans have larger co-pays, higher-deductibles, brand-name medication limits, and therapy visit caps.

Fortunately, up to 91% of larger firms offer an Employee Assistance Program (EAP) to bridge the gap with free counseling and referral services. And nearly two thirds offer wellness resources and programs to address topics like stress in the workplace and smoking cessation.

However, private mental health care may not cover:

• 100% of the cost of addiction treatment; (60-90% is covered on ACA plans, based on the plan purchased)
• The exact medication you prefer; generic options are included
• Non-mental health diagnoses like internet addiction
• Financial counseling, such as for bankruptcy
• Legal counseling, as in how to file for divorce or adoption
• Psychotropic, experimental, or homeopathic drugs
• Weight loss program membership fees or diet food
• Gender reassignment surgery (counseling and therapy would be covered)
• Unlimited visits to a therapist; many plans have an annual cap
• Mental health issues that occur while traveling outside the US
• Lost wages while in a treatment or recovery center

To find out exactly what coverage your health plan provides in insurance for mental health, refer to your insurance provider’s benefits summary, often referred to as a Summary Plan Description (SPD).

How to Know If Your Insurance Covers Therapy

The first place to look for your mental health insurance coverage is on the plan documents provided by the health insurance provider. However, if you’ve misplaced them, you have numerous options to gather the mental health insurance coverage information you need.

To find mental coverage information, go to:

• Human Resources (HR): Employees can ask an HR rep what’s provided and request plan documents to be emailed or mailed. HR reps can help you find specific information within the documents.
• Healthcare Providers: Major health insurance providers like UnitedHealth and Aetna have websites with coverage information. Some offer a chatbot to answer questions like, “does my plan cover Paxil?”
• An HR/Payroll App: If you’re in a firm that has an employee self-service HR/payroll system, you may find plan information available through an app or online website.
• HR Call Center: Larger firms may have a HIPAA-compliant HR call center to answer questions about mental health insurance coverage over the phone.
• Government Website: Government providers like Medicaid offer assistance by phone, website, or online help and let you access downloadable plan documents.
• Broker: Those insured through a broker can request information from their health insurance agent; ask them to schedule a time to review your mental health coverage.

How to Find a Therapist Covered by Insurance

The best place to find a therapist that accepts your insurance is through your insurance carrier’s website. Most insurance providers, such as Blue Cross/Blue Shield or Cigna, post an online list of in-network providers. If not, you can contact their call center or customer support number to determine whether your preferred provider is in their network.

Another way to find a therapist who accepts your insurance is to call your therapist’s office and ask whether they take your insurance plan. Keep in mind there are a myriad of providers who can meet your mental health needs, including medical professionals. Which you choose depends on whether you require therapy, medication, or both.

Here are examples of covered providers who can fulfill your mental health needs:

• Psychiatrist: Medical professional certified by the American Board of Psychiatry and Neurology (ABPN) is able to address all mental health needs
• Medical doctors (M.D.): Family medicine doctors can often provide medication
• Doctor of osteopathic medicine (D.O.): These professionals can offer both medication and treatment, including mental health assessments and behavioral counseling
• Licensed clinical psychologist: These experts provide counseling and therapy; some states allow them to prescribe medications as well
• Clinical social worker: These professionals provide child and family mental health support such as group therapy
• Licensed Family Counselor: These therapists have Marriage and Family Therapy (MFT) certification and provide all kinds of mental health and substance abuse support
• Clinical Nurse Specialist (CNS) and Nurse Practitioners (NP): Similar to an MD or DO, these practitioners, whether CNS or NP, can provide basic mental health support and in some states, may be able to provide medication prescriptions
• Physician Assistant (PA): Some physician assistants, with the proper training and under the supervision of a psychiatrist, can also provide mental health care

How Does My Therapist Bill My Insurance Provider?

Therapists may use different resources to receive payment, but generally, the therapist will bill your insurance following your session and wait to receive their fee. Other therapists may require you to pay them upfront and then refund the cost once the insurance payments arrive. Others will accept cash payments only and not utilize any insurance coverage.

What If I Can’t Afford the Deductible?

Your options may be limited if you cannot afford your insurance deductible for therapy, but there is hope. If your therapist works at an agency, the facility may offer special financial support for people in need. County assistance may also be available. You could qualify for secondary insurance that covers deductibles, copays, and other out-of-pocket fees.

What If I Can’t Find a Therapist Who Takes My Insurance?

If you are struggling to find a therapist who accepts your insurance and is taking new clients, your best course of action is to call your insurance plan. They will provide you with a full list of in-network providers. If options are still limited, ask for access to out-of-network therapists.

Finding an Out-of-Network Therapist

Some types of insurance plans, such as Health Maintenance Organizations (HMO) like Kaiser, may exclude out-of-network services. That means you’d pay the entire cost of your mental health visits yourself, out of your own pocket. However, those with mental health insurance plans that cover some portion of the out-of-network provider fees can often find a therapist, counselor, or psychiatrist by searching these terms online or using an old-fashioned phonebook. Another option is to ask for a referral from your primary care physician.

An out-of-network provider may not choose to submit the cost of your visit as a claim to your insurance carrier. In that case, you will need to request a “superbill” from your therapist and submit a claim for reimbursement. A superbill is more than a receipt for services paid. Instead, it provides additional information such as your personal details, date of service, and diagnosis. That allows your insurance company to reimburse you based on your co-pay and UCR caps.

Mental Health Parity Laws

Under the ACA, insurance providers must cover mental health and substance use disorder treatment services at the same level as they do medical and surgical services. That’s referred to as parity and governed by the Mental Health Parity and Addiction Equity Act (MHPAEA), last updated in 2014.

This law was designed to ensure that people suffering from mental health issues can get the care they need. And it appears to be working, as mental health providers noted an increase in visits of nearly 17% (psychiatrists) and 2.5% ( therapists) after MHPAEA was implemented.

How Mental Health Parity Laws Impact Mental Health Insurance

If your medical insurance covers 90% of hospitalization costs for heart surgery, your health insurance provider is required to provide the same rate of coverage for in-patient mental health care, i.e., covering 90% of the cost of a psychiatric hospital stay. Parity laws cover Medicaid, large group plans, and most mental health insurance plans offered through the healthcare.gov exchange. However, certain insurance plans such as self-insurance plans and small group plans offered by businesses with fewer than 50 employees may not be required to offer parity.

Mental Health Insurance Statistics

One of the challenges is that those with mental health problems are less likely to have insurance. Over 10% of those with mental health issues don’t have insurance at all. And the numbers are much higher (up to 40%) for those with serious psychological distress.

Here are some interesting statistics about mental health insurance, costs, and utilization:

• 49% of Americans get their health insurance through an employer, however, these rates go up to 60% in many midwest and east coast states
• 25% get their insurance through the marketplace or medicare
• Nearly 50% of whites, females, and LGBTQ members needing treatment for mental health issues got support in 2018; rates are significantly lower for males and ethnic populations, where far fewer receive the treatment they need
• 29% of the cost for mental health services is paid out of pocket. In addition, out of pocket expenses have been rising since the implementation of MPHAEA.
• 2.4% to 22.9% of adults with any mental illness (AMI) have no health insurance. The percentage varies by state, i.e. Georgia, Texas, and Wyoming have the highest rates of uninsured AMI individuals, while Mass., Iowa, and Wash. D.C. have the lowest.
• 57.2% of adults with mental health receive no treatment

The good news is that mental health insurance is included in most public and private health insurance plans whether you’re insured through an employer, a broker or a government agency. And thanks to parity laws, mental health services won’t cost more than medical services. However, not all mental health professionals accept insurance. Therefore it’s crucial to look at your benefits plan documents when purchasing or using mental health insurance.