Does Insurance Cover Therapy?

Emotional and mental health is a critical part of a person’s overall well-being, but all too often individuals who suffer from depression and other disorders frequently go without in-person or online therapy or professional treatment. The fact of the matter is, therapy can be expensive, and sometimes people either dismiss the cost as out of budget concerns, or have a difficult time navigating health insurance coverage to the point of giving up.  

According to the National Network of Depression Centers, each year less than half of the 16 million American adults who experience major depression receive treatment. Overall, one in five of the 44 million people with mental health conditions are not getting professional care, according to Mental Health America.

Is therapy worth the cost? Given that insurance coverage of mental health services has improved greatly in the past decade, it doesn’t make sense why so many people do not seek therapy treatment when they need or want it. Especially when many health plans are now required to provide equal coverage for mental health care and medical care, thanks to provisions of the Mental Health Parity and Addiction Equity Act and the Affordable Care Act.

Though it shouldn’t be surprising, considering that the act of determining whether your health plan covers therapy can be a lot of work. And, when you’re overwhelmed with a mental health concern, that typically means your cognitive resources are tapped out. Navigating health benefits takes a lot of cognitive resources.

This guide can help you figure out whether your health insurance company covers therapy or other mental health treatments. If you have health insurance, chances are good that your policy provides some level of coverage. To address the importance of and demand for sustaining mental wellness, most insurance companies offer some coverage for mental health services. But there are large differences between the benefits health insurers provide and the out-of-pocket costs you might be required to pay.

Does health insurance cover individual therapy services?

Whether the need is urgent or ongoing, it’s important to understand what mental and behavioral health services your current plan covers in case you need it. Any health insurance plan that does offer mental health services must cover:

  • behavioral health treatment, like psychotherapy, talk therapy, and counseling
  • mental and behavioral health inpatient services
  • substance use disorder treatment

However, benefit amounts and limits vary by state and the plan you choose. You can compare plans on or, if you’re insured through your employer, by asking your human resources representative.

It’s important to note that just because a plan offers coverage for mental health doesn’t mean that all services are automatically covered. For example, stress caused by common life changes like a relocation or breakup may not be covered. However, if the stress is diagnosed as a symptom of a medical condition like generalized anxiety disorder, it should be covered per the parity law. Pre-existing mental or behavioral conditions (like substance use disorders) are also covered with the same deductibles, co-pays, visit limits, etc., as other new—or existing—physical or mental health issues.

What kinds of therapy treatments are typically covered by insurance?

Talking to a mental health professional can be helpful for a range of mental health concerns, including therapy for depression, anxiety, and addiction. The most common treatment is talk therapy. The amount of cost sharing and coverage you have for talk therapy will depend on your specific health insurance plan. The best way to find out if your insurance plan covers talk therapy is to review your Summary of Benefits and Coverage. Some additional mental health services that may be covered by insurance may include:

  • psychiatric emergency services
  • co-occurring medical and behavioral health conditions, such as coexisting addiction and depression
  • other types of talk therapies like psychotherapy and cognitive behavioral therapy
  • unlimited outpatient sessions with a psychiatrist, clinical social worker, or clinical psychologist
  • telemedicine and online therapy
  • inpatient behavioral health services received in a hospital or rehabilitative setting 
  • addiction treatment
  • medical detox services, including medications

Insurers only cover treatments that are considered medically necessary, and coverage may be restricted to a certain amount, depending on the treatment. The breadth of coverage for specific therapeutic treatments, such as the length of rehab or hospital stays, also varies from plan to plan. This also applies to coverage and cost for medications you might be prescribed to treat your condition, both as an inpatient and as an outpatient.

How do you know if your insurance covers therapy?

Your health insurance plan’s website should contain information about your coverage and costs. Since insurers offer a variety of plans, make sure you’re logged on and viewing your specific insurance plan. If you’re required to choose a therapist that’s in your plan’s network, a list of providers should be available online. 

If you need additional information, call the toll-free number on the back of your insurance card and ask questions about the types of therapeutic services you can expect coverage for, as well as any out-of-pocket costs you may incur. If you have a diagnostic code, that may help you get accurate information.

If you’re insured through employment and need additional help, contact your human resources (HR) department, if you feel comfortable doing so. If you have health insurance through your job, it may or may not include coverage for therapy. Even if you have coverage, it’s up to you to decide whether or not you wish to use it for mental healthcare. In some instances, people choose to pay out of pocket for therapeutic services rather than claim coverage through their insurer. 

Insurance companies only pay for medically necessary services. They require a mental health diagnosis before they will pay claims. Some people are not comfortable with this.

A mental health condition diagnosis may range from acute stress to insufficient sleep syndrome, various phobias, mental illnesses, or a number of other descriptors. When it comes to insurance, each of these would have a code number that would go with an insurance claim.

Companies of 50 or more full-time workers are legally mandated to provide health insurance. This mandate does not specify that mental health services be included as a benefit. Even so, most large companies, including those that are self-insured, do provide health insurance that includes some coverage of therapeutic services. Small companies that employ under 50 people are not legally required to provide health insurance to their employees. However, for those who do, mental health services and substance use disorder services must be included, no matter where or how the plan is purchased.

Under the Affordable Care Act, all plans purchased through the Health Insurance Marketplace must cover 10 essential health benefits. These include mental health services and substance use disorder services.

All Marketplace plans, whether they’re state or federally managed, include coverage for mental health. This pertains to individual plans, family plans, and small business plans.

Plans and their coverage vary by state. States also offer multiple plan options, which vary in terms of their coverage.

All Marketplace plans must include:

  • behavioral health treatments, such as psychotherapy and counseling
  • mental and behavioral health inpatient services
  • coverage for pre-existing conditions
  • no yearly or lifetime dollar limits on mental health coverage
  • parity protections so that the copays, coinsurance, and deductibles for mental health services are the same or similar to those for medical and surgical benefits

Once you’ve found a shortlist of therapists from which to choose, make sure insurance is part of the vetting process as you go through consultations. Therapists and other providers often change the insurance plans they’re willing to accept and may have opted out of your plan.

When does insurance start for therapy services?

Remember, you can’t be penalized for having a pre-existing condition or prior diagnosis of any type of mental illness. For that reason, you should be entitled to mental health services from day one of your plan’s start date.

Things that might affect when insurance coverage kicks in:

  • After prior authorization. Some services may require pre-authorization before you can obtain coverage for them.
  • After meeting a deductible. You may also have to meet an out-of-pocket deductible before your plan starts to cover therapy. Based on the type of plan you have, this amount may be significant.
  • After spending a minimum. In some instances, your plan may require that you pay a specified dollar amount on medical services before your coverage for therapy can start.

How can insurance help pay for therapy?

When you are covered by health insurance, you’re responsible for the same copays and deductibles for mental health services that you’d pay for physical healthcare. However, the parity law states you can’t be subject to two different deductibles. Any amount paid out-of-pocket for mental healthcare goes toward your plan’s overall deductible. For instance, if you have a $3,000 deductible, and pay $1,500 for physical healthcare and $1,500 for mental healthcare, you’ve met your deductible for the year.

Mental healthcare providers can choose whether or not to accept insurance at all, and it’s generally pretty common amongst therapists to choose not to be. In order to maximize your insurance benefits, it’s best to seek mental health treatment with a provider in your plan’s network. This provider will have negotiated rates for service with the insurance provider and will — in most instances — handle filing claims and other paperwork.

You always have the option of treatment with an out-of-network provider who does not accept your insurance. In this case, even if you have mental health coverage, you’ll likely have to pay the entire amount out-of-pocket (usually at the time of service). Then you’ll be responsible for filing claims with your healthcare plan to receive any available reimbursement.

How can a therapy session be paid for without insurance?

You don’t need a medical diagnosis to seek treatment. And, you should never avoid seeking necessary mental health services due to a lack of coverage or understanding of your coverage. If you are wondering, how much is therapy without insurance -- you should know that you have options.

If you don’t currently have a healthcare plan that offers mental health coverage, these options may help you locate — and afford — quality mental health services:

  • employee assistance programs
  • disability benefits
  • local social services
  • student programs
  • non-profit options

If you intend to pay for therapy out of pocket, know that psychiatrists may charge different rates per hour than other types of mental health professionals, such as psychologists or licensed clinical social workers. This may also affect the cost of your co-pay, if you use your insurance to pay for therapy. You should also be familiar with the average cost of a therapy session and online therapy cost. 

Most health insurance plans cover therapy. The amount of coverage you can expect as a patient will vary from plan to plan. Though, therapy can be expensive, with or without insurance. There are low-cost options that can help, such as therapists who take sliding scale payments and psychotherapeutic collectives that offer steeply reduced sessions.

If you’re looking for insurance to cover therapy, but don’t know where to start, Advekit can help. We can help match you with a therapist who not only aligns with your needs and approach, but also your insurance preferences. Advekit will also help you navigate your personal insurance plan and handle the paperwork. Get connected today.

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