```
Clients

Is Therapy Covered by Insurance?

Brandon Grill
|
July 26, 2023
What You Need to Know in 2023

Though the stigma around mental health is weakening, concerns about cost are as strong as ever. If you’re wondering “is therapy covered by insurance?” then you’re in good company with millions of other therapy-seekers.

In this blog, we’ll walk you through the things you need to know about using insurance to cover the cost of therapy in 2023. At the end of this blog, you’ll know what treatments are covered, when they’re covered, what laws affect mental health care coverage, and more. 

Let’s get started.

Is Therapy Covered by Insurance?

Therapy is often covered by insurance, but the extent of coverage varies. Coverage can be influenced by the type of insurance plan, the specific insurance panel, and the policy details.

Coverage is typically provided for the treatment of mental health conditions such as anxiety disorders, depression, bipolar disorder, and more.

However, it’s important to note that insurance coverage for psychotherapy often has limitations. These can include restrictions on the number of sessions, types of therapy, or pre-authorization requirements.

Insurance plans may also have networks of preferred providers, and coverage may be higher for in-network therapists compared to out-of-network therapists.

If you’re wondering “is mental health therapy covered by insurance?,” the answer depends on your specific policy. We answer the question “Can I use my insurance for therapy?” below.

Laws that Affect Your Mental Health Coverage

Is therapy included in health insurance? Often, the answer is yes. A lot of health insurance plans cover therapy as part of their mental health or behavioral health coverage.

A few things to keep in mind when seeking to use your coverage for mental health include:

Now, let’s discover some laws that affect how mental health care is insured.

The Mental Health Parity Act of 1996 (MHPA)

The Mental Health Parity Act, passed in 1996, requires insurance plans to offer mental health benefits on par with medical and surgical benefits.

For example, if your insurance covers 20 trips to your family doctor, it should cover 20 trips to a therapist or other professional. 

The aim is to eliminate disparities and discrimination in mental health coverage, ensuring that individuals have equitable access to necessary care.

Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA)

Building on the MHPA, the Mental Health Parity and Addiction Equity Act of 2008 extended parity protections to substance use disorder (SUD) services.

It also imposed stricter requirements on insurance plans to ensure equal coverage for mental health and substance use disorders compared to medical and surgical benefits.

The benefit to therapy seekers is better parity between physical health and mental health coverage, as well as coverage for SUD treatments if needed.

The Affordable Care Act of 2010 (ACA)

The Affordable Care Act (ACA) made it easier for people to get mental health care through their insurance. 

The ACA requires insurance plans to cover mental health and substance use services, treating them equally with other medical services. The ACA also expanded Medicaid, which provides coverage for low-income individuals.

The Health Insurance Marketplace was a major contribution of the ACA. It offers options for mental health coverage, so people can choose a plan that fits their needs.

Overall, the ACA improved access to mental health care and reduced cost barriers.

How Much Therapy Will Insurance Cover?

The answer depends on a few factors. So, let’s break this down in a few different ways.

How many therapy sessions does insurance cover?

Insurance plans may have limitations on the number of therapy sessions covered within a specific time period. Some plans may cover a certain number of sessions per year, while others may have limits based on medical necessity or require pre-authorization for additional sessions.

It's essential to review your plan documents or contact your insurance provider to understand the session limits.

How much do insurance companies pay for therapy?

Therapy services may have associated costs such as:

The specific amounts can vary depending on your plan.

Each plan is different, but when you go in-network with a therapist, you generally can expect to pay $30 or less per session, after the deductible is met.

In-Network vs. Out-of-Network?

In-Network will always be cheaper due to provider agreements with insurance companies. Out-of-network will usually require higher out-of-pocket payments and require paperwork for reimbursements. Luckily, there are now services that automate reimbursement claims for you. More on that below.

Different Therapy Modalities?

Everyone’s insurance plan is different. Some modalities are covered while others are not. See the next section for common coverage, then check with your insurance company to see what’s covered in your plan. 

As always, it’s best to review your insurance plan directly for coverage details.

Types of treatment typically covered by insurance

So, what kinds of mental health treatments are typically covered by insurance?

Insurance plans typically cover a range of mental health treatments, depending on the specific plan and its coverage provisions. Here are some common mental health treatments that are often covered by insurance:

It's important to note that while these treatments are generally covered, specific coverage details, such as copayments, deductibles, session limits, and network restrictions, may vary depending on the insurance plan.

Are there any treatments that may not be covered?

Now you should have a good idea of what is and isn’t covered.

When is Therapy Covered by Insurance? What are the Requirements?

Therapy is typically covered when certain requirements are met. These include medical necessity, in-network providers, referrals from a physician, pre-authorization from the insurance company, coverage limits, and cost sharing.

  1. Medical Necessity. The therapy must be necessary for the diagnosis, treatment, or management of a mental health condition as determined by a qualified healthcare professional.
  2. In-Network. Insurance plans often have a network of preferred providers. To ensure coverage, it is usually required to see an in-network therapist or mental health professional.
  3. Physician referral. To ensure that the therapy is appropriate and necessary for your condition, your insurance company may require a physician’s referral.
  4. Pre-Authorization. Some insurance companies require you to get their pre-authorization before starting therapy in order to use your benefits.
  5. Coverage Limits. Insurance plans often have limits on the number of therapy sessions covered within a specific time period. This can include annual session limits or restrictions based on medical necessity.
  6. Cost Sharing. Insurance plans typically involve cost-sharing, which may include copayments, deductibles, and coinsurance. 

Luckily, there are some companies that make it easier to get out-of-network benefits reimbursed. This can be helpful if your therapist doesn’t take your insurance or if they don’t take any insurance at all. More on this in later sections.

Types of Coverage

In this section we’ll talk about the major ways you may receive insurance coverage. Please skip to the section(s) that are most relevant to your situation. If you’re unsure, contact your HR department or the number on the back of your insurance card for more guidance.

Employer-sponsored insurance in companies of 50+ employees

If you get your insurance from your job, and your job has 50+ employees, this section is for you. 

Employer-sponsored insurance in companies under 50 employees

Mental health insurance is treated differently in companies with less than 50 employees (“small group plans”).

It’s important to check state-by-state requirements for your plan, as benefits and requirements vary.

Medicaid

Medicaid provides health insurance coverage to people and families with low-income. It plays a significant role in ensuring access to mental health services for those who may not be able to afford private insurance.

Medicare

Medicare is primarily for people aged 65 and older, as well as certain younger individuals with disabilities or specific health conditions. 

Health Insurance Marketplace Plans

What if you don’t have employer-sponsored insurance or Medicare or Medicaid? Then Health Insurance Marketplace Plans (“Obamacare” plans) may be for you.

Children’s Health Insurance Program (CHIP)

The Children's Health Insurance Program (CHIP) is a U.S. government-funded program that provides health insurance coverage to children from low-income families who do not qualify for Medicaid.

Families interested in CHIP coverage for mental health services should contact their state's CHIP program or visit the official Medicaid/CHIP website to learn more.

Blue Cross Blue Shield

Blue Cross Blue Shield (BCBS) is a federation of independent health insurance companies operating across different states.

It's important to note that coverage and availability of services can vary by state and individual plans. To obtain accurate information, individuals should review plan documents, contact their local BCBS company, or consult with their employer's HR team.

Kaiser Permanente

Kaiser Permanente offers comprehensive mental health insurance coverage as part of its integrated healthcare approach.

To see what your coverage includes, contact Kaiser Permanente directly.

How Do I Know if My Insurance Covers Therapy?

What if you have insurance but you’re not sure about it’s mental health coverage? To make it easy for you, we’ve created this 5-step process you can use to gain clarity on your coverage:

  1. Review Your Insurance Plan Documents: Start by reviewing your insurance plan documents. Look for sections related to mental health coverage, behavioral health, or psychological services.
  2. Understand Coverage Terms: To understand your coverage, get familiar with terms like copayment, coinsurance, deductibles, out-of-pocket maximums, and session limits. Understanding the financial aspects of your coverage will help you make good decisions.
  3. Identify Mental Health Benefits: Look for information specifically related to mental health services, therapy, or counseling. Note the type of therapy covered (individual, group, family) and any requirements, such as referrals or pre-authorization.
  4. Verify In-Network Providers: Check if your insurance plan has a network of preferred providers. Look for online resources that list mental health professionals who are in-network for your plan. You can usually find this information on the insurance company's website or by contacting their customer service.
  5. Contact Your Insurance Provider: If you still have questions or need clarification, contact your insurance provider's customer service. They can provide specific information about your coverage, answer questions about therapists in-network, and guide you through the process of accessing mental health services. Be prepared with specific questions about therapy coverage, session limits, and any potential out-of-pocket costs.

By following these steps, you can gain a better understanding of your insurance plan's coverage for therapy. Remember to document important information, such as names and contact details of in-network providers, coverage limits, and any authorization or referral requirements. This will help you make informed decisions when seeking services.

Pros and Cons of Using Insurance to Cover Therapy

Using insurance to cover therapy has both pros and cons. Let's explore some of them:

Pros of Using Insurance to Cover Therapy:

Cons of Using Insurance to Cover Therapy:

It's important to carefully weigh these pros and cons based on your individual circumstances and preferences. Consider factors such as your financial situation, desired therapist options, privacy concerns, and the specific coverage details of your insurance plan when deciding whether to use insurance to cover therapy or explore alternative payment options.

Out-of-Network Benefits: What if I Can't Find a Therapist Who Takes My insurance?

And that concludes things you need to know about using your mental health insurance for therapy!

Now you understand different laws, coverage plans, and factors that affect your coverage.

But what if you still can’t find a therapist who takes your insurance?

Luckily, there’s Thrizer, a payment app that makes out-of-network therapy much more affordable.

When you choose a therapist who accepts payments with Thrizer, you can use your insurance benefits even if even if your therapist doesn’t take insurance.

Thrizer links to your health insurance and verifies how much your insurance is covering with your out-of-network benefits. You only pay what you owe while they while they cover the rest of the provider's fee and wait for reimbursement for you.

To learn more about Thrizer, visit our website at
thrizer.com!

___

This blog post is provided for informational purposes only and is not intended as legal, business, medical, or insurance advice. Laws relating to health insurance and coverage are complex, and their application can vary widely depending on individual circumstances and state laws. Similarly, decisions regarding mental health care should be made with the guidance of qualified health care providers. We strongly recommend consulting with a qualified attorney or legal advisor, insurance representative, and/or medical professional to discuss your specific situation and how the laws apply to you or your situation.

About the Author
Brandon Grill

Brandon Grill is a mental health copywriter and marketer based in Las Vegas, NV. He loves helping mental health professionals build fulfilling businesses. You can find Brandon going on a walk with his adorable nephews.