Insurance for therapy: why it might not be helpful

That's what insurance is for, right?

You are at a place in your life where seeking help is possible. Your next step is finding a therapist. So you start with the network of providers for your insurance. Surely, you will be using your insurance to pay for therapy, right?

Financial concerns are a legitimate reason to want to find a provider that takes your insurance. But is insurance the best and only way to pay for therapy? Read on for some things to consider.

Reasons NOT to use insurance

Privacy and confidentiality

computer, notebook, laptopYour therapist must provide certain pieces of information to your insurer in order to be paid for the services.

A mental health diagnosis: If you don’t meet the criteria for a mental health diagnosis, your therapist has only a few options:

  • Assign a diagnosis you don’t have so that your insurance company will continue authorizing sessions.
  • Discontinue therapy.
  • Continue to work with you without assigning a diagnosis but risk having claims denied. This would mean not getting paid for the work.

Case notes: Therapists work hard to protect your privacy from insurers. Regardless, they still have to provide some form of documentation to your insurance provider in order to get paid.

Insurance driven treatment plan: Some insurance plans dictate the number of sessions and types of treatment that will be covered. The insurance company makes these decisions and applies them generally. It is not based on you with your specific needs and circumstances. Ideally, you and your therapist develop the treatment plan collaboratively.

It may not save you money

High deductible:  You won’t really see an obvious cost saving if you have a plan with a high deductible. Especially in situations where you are unlikely to meet your deductible.

Your therapist will charge a higher rate when billing through your insurance. You will owe your therapist this amount. So until you meet your deductible, your first few sessions may cost you quite a bit of money.

Reasons FOR using insurance to pay for therapy

It can save you money

money, bills, calculatorNow for the other side of the coin. In some situations, you will save money by using insurance to pay for therapy. This is highly dependent on your specific benefits so it may or may not be true for you. But there are plenty of reasons using insurance can save you money.

Lower negotiated rates with preferred providers: This cost savings may not be obvious until you meet your deductible.

You may only need to pay your copay: Plans that have copays for therapy services may mean your out-of-pocket costs are low from the start.

Deductible or Out of Pocket Max: If you meet these two benchmarks early in the year, then insurance will typically cover a significant portion. This can result in significant money saving.

Preferred Providers

Insurance companies credential the therapists that they list as being in network, so that may give you peace of mind. Although, I highly recommend you do research about the therapist you choose even if they are in your provider network.

A final note

Finding a therapist that is a good fit for you and your situation is a key part of the healing process of therapy.

I can’t emphasize this enough. To get the most out of therapy, you want a good connection with your therapist. And you want that therapist to be skilled in the area in which you are struggling. You will see significantly more progress and feel better about the process if your therapist meets these criteria.

But money is a real barrier for most people seeking therapy.

To facilitate this, I keep my private pay rates at a reasonable level to make it possible for clients to pay me out of pocket. Additionally, clients are able to use a Health Savings Account (pre-tax $) to pay for sessions.

I am also part of Open Path which connects clients with no insurance, or poor coverage, with therapists that agree to provide these services at a reduced rate ($30-60 per session).

Ultimately the decision whether to use your insurance to pay for therapy services is a complex and personal decision. But if you are ready, contact me today to set up your initial session.