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Insurance For Counselors and Psychotherapists | Insurance FAQs

Insurance FAQs

What about insurance for counselors and psychotherapists?  Here are some answers to Insurance FAQs (Frequently Asked Questions) to help in planning how you might use your benefits.

Do you take insurance?  Yes.  My professional services qualify for reimbursement under most insurance plans, so I am considered an out-of-network provider.

What is an out-of-network provider?  Out-of-network providers are professionals who do not contract with a given insurance company to provide services.  Many mental health professionals provide services independent of the insurance companies’ economically derived rules and guidelines for mental health treatment.

What does it mean – “provide services independent of…rules….”?  Your insurance provider has likely contracted with a third-party company specializing in managing costs of mental health care.  In short, they fulfill terms of their contract with you by hiring people to review and mandate the terms and length of your treatment. 

By assessing the number of members in each zip code with anticipated needs for service, these companies contract with a specific number of in-network treatment providers to accept mandated terms of treatment and discounted fees for service in return for referrals of their members.  Given that only a specific number of providers in each zip code are allowed to provide services on in-network panels, many mental health professionals discover that in-network panels are now ‘closed’ to them as service providers.  Other service providers thoughtfully choose to forgo referrals of insurance companies to their practice for professional, philosophical, and ethical concerns.

In this case, “provide services independent of … rules …” refers to the out-of-network provider who forgoes referrals to his/her practice by insurance companies (for whatever reason), and thus maintains the professional right to assess and treat your needs without any third-party intercessions and mandates.

How does insurance work?  According to the benefits of your contract, the insurance company will reimburse a percentage of the cost your therapy sessions after you have met your annual deductible amount.  That means you will pay 100% of the cost of your therapy until you’ve met that deductible.  After that, you will most likely be limited to a specific number of sessions per calendar year for which you will pay a co-pay and the insurance company will pay me as your service provider a discounted reimbursement for the total fee.

Does working with an out-of-network provider mean that I will have to pay more?  “No” is the most likely answer After agreeing to establish a therapeutic relationship, we will determine how much your plan will pay, then collaborate to create a co-payment amount you can afford.  You will determine how many sessions you want to invest in rather than your care being mandated by your insurance company. 

How do I figure out how much my therapy will actually cost me?  At our first meeting (or before), I will photocopy your card, then contact your insurance company to confirm the terms of your benefit package.  I’ll ask about the effective date of your coverage, deductible amount, percentage paid for each session, number of allowed sessions, and the address to mail your claim.  We will then discuss how those terms affect the total cost for your therapy and agree upon a process for how it is to be paid. 

Though there are significant intangible benefits to working with an out-of-network provider, you’ll want to have a good idea, too, about any real dollar differences.  You can count on being ultimately responsible for your deductible amount (generally ranging from $500-1500) and the agreed upon co-payment.  If your plan should deny your claim for any reason, you would also be responsible for the percentage we expected them to pay.  (Your planning should also include the annual renewal of your deductible amount and responsibility for any missed appointments not cancelled within the 24 hour window.)

More things to learn about:  Because I’m not qualified to offer any legal or medical advice, I do encourage you to inquire and learn more from your insurance representatives about the following questions and issues:

  • Will your benefits depend upon whether or not the diagnosis for your problem is covered by your policy?
  • Are some mental health diagnoses covered and others not?  Why?
  • Once given, will the diagnostic ‘label’ become a part of your permanent medical records and what might that mean to you in the future?
  • Though you’re protected by HIPAA (Health Insurance Portability and Accountability Act) from having your medical — and mental health information shared without your consent, how is the diagnostic label you’ve been given protected within the company?