Using Your Health Insurance to Pay for Psychotherapy: The Basics

Health insurance can be confusing. But understanding your health insurance benefits and coverage, including your financial responsibilities, is part of working with a psychotherapist or with any medical provider. And when you’re choosing a new therapist, whether or not they accept your health insurance can be an important financial consideration for many people. So while it may feel a little confusing or intimidating, you need to understand the basics about your health insurance because it can help make psychotherapy accessible and can save you a lot of money.

In this blog post, we share basic information about “in-network” vs. “out-of-network” health insurance coverage; insurance considerations when searching for a new therapist; info on how your health insurance can be used to help pay for psychotherapy; and non-insurance options you may not have considered that could also help you cover some of your psychotherapy costs. At IntraSpectrum Counseling, our goal is to help you be a knowledgeable health insurance consumer – whether you are looking for a new therapist or using your benefits to pay for sessions with a therapist you’re already working with.

If you have questions after reviewing the information in this blog, the Client Services team at IntraSpectrum Counseling is happy to help. You can submit an inquiry form online, email us at help@intraspectrum-chicago.com, or leave a message for a callback on our office line (312-379-9476).
___________________________________________

What “In-Network” vs. “Out-of-Network” Insurance Coverage Means

Therapists (or the group practices / health centers they work for) make the decisions about which health insurance companies they work with. They may choose to accept several different health insurance providers, only a few, or none at all. Working with your current therapist, it’s important to know the basics about your coverage so you’re aware of your benefits and the costs you are responsible for. And if you’re in the process of choosing a new therapist, one of the first decisions you’ll need to make is whether to limit your search to in-network therapists or to also include out-of-network therapists.

In-Network Therapists
A therapist or group practice is considered to be “in-network” if they have a written agreement with your health insurance provider to be part of their network and to accept a payment amount per therapy session that the insurance company sets. For consumers, this may sound more familiar as whether a therapist “accepts your insurance” / “takes your insurance”. An in-network therapist can be the most affordable way to pay for psychotherapy, because the health insurance plan typically pays the bulk of the fees. (NOTE: this applies to individual (adult, teen, child) and group psychotherapy. The process and your coverage / benefits may be different for relationship / couples counseling and family counseling).

You can usually find a list of in-network psychotherapists on your insurance company’s website. For complete information regarding your coverage, it’s best to refer to the summary of benefits chart which is typically in your policy packet. You can also contact your insurance carrier for answers to specific questions or to ask about a specific therapist or group practice.

Working with an in-network therapist can be a good option to consider if:

it’s important to keep your per-session therapy cost as low as possible
you’ve already incurred medical costs this calendar year (to satisfy your annual deductible)
your co-pay is not affected by your deductible

If you’re looking for a new therapist, & you only consider those who are in-network:

You’ll have a smaller number of therapists to choose from
There could potentially be a longer wait before finding someone
You’ll have reduced opportunities to match with a therapist that meets your preferences (types of therapy, expertise / specialities, shared experiences, identity etc.)

Out-of-Network Therapists
A therapist or group practice is considered to be “out-of-network” if they don’t have a written agreement with your health insurance provider to be part of their network. This may sound more familiar as therapists that “don’t accept” / “don’t take” your insurance. There are ways for some out-of-network clients to use their insurance to reimburse for psychotherapy. In these cases, the therapist (or the practice they work for) sets their own fees for sessions (the amount you pay upfront), but the insurance company decides whether to offer reimbursement, and what the reimbursement rates are.

The best way to find out about / understand your out-of-network coverage is to call your insurance company & speak with a representative. The number for member services is typically on their website, on written correspondence, or on the back of your insurance card.

Working with an out-of-network therapist is a good option to consider if:

your out-of-network health insurance benefits include partial reimbursement for out-of-network mental health treatment
you are able to pay for your psychotherapy sessions upfront & wait for reimbursements from your health insurance carrier
you have a high in-network annual deductible (which would need to be satisfied before your co-pay would apply)
you’re looking for a therapist who offers specialized areas of focus or types of therapy (because you’ll have the largest-possible pool of therapists to consider)

Currently, IntraSpectrum Counseling is in-network with Blue Cross Blue Shield PPO, BCBS Blue Choice PPO, Aetna, Anthem, Ambetter and Cigna. If you have a different insurance carrier or if you have an HMO with any insurance carrier, we would be considered an out-of-network provider for your health plan. You may be eligible for out-of-network coverage at IntraSpectrum Counseling if it’s offered by your carrier, but the process and reimbursement rates are different than for in-network coverage. We will verify your out-of-network benefits and provide you with this information prior to your first session.

Why Therapists Might Choose to be In-Network vs. Out-of-Network
Some therapists or practices may use a business model that isn’t compatible with the extra paperwork or logistics time required for accepting health insurance. Others might choose to not work with a particular insurance company because of a process they use or the reimbursement rates they pay to in-network therapists. Still other providers may feel that insurance requirements leave them with less time for clients, or less autonomy over patient care.

The majority of therapists and practices do work with health insurance carriers though – as an in-network provider, an out-of-network provider, or both – because health insurance helps therapists / practices to:

maximize access to mental health services, for as many people as possible
serve a diverse clientele, especially those who might not otherwise be able to pay for therapy
attract new clients / build a client caseload

Why Work with an Out-of-Network Therapist?
With an out-of-network therapist, you can typically get a portion of therapy session fees reimbursed by your insurance company, making this an affordable option for many clients.
And if you’re looking for a new therapist, we recommend, if you are able to afford it, that you not limit your search to only in-network therapists, for several reasons:

Also including out-of-network therapists gives you a larger number to consider. This is particularly important for people with less common / smaller health insurance carriers
Including out-of-network therapists may reduce the time needed to be matched with a therapist who meets specific preferences (types of therapy, shared experiences or identity) or who has specific expertise, or to find a therapist in general

Paying for Therapy with Health Insurance / In-Network Therapist
Assuming your plan includes mental health coverage for sessions with an in-network psychotherapist, there are two key factors that determine how much you will pay:

Your Co-Pay: This is the fee (set by your insurance company) that you pay at every therapy session. In these instances, after your therapy session, your therapist sends a claim to the insurance company to receive the remainder of the fee they’re owed. For example, assume the therapist’s session fee is $185. You pay your therapist a $30 copay at each session and your therapist gets paid the remainder of the session fee ($155) by the insurance company.

Your Deductible: This is the sum total of eligible medical costs you need to pay each calendar year before your insurance coverage begins. This works in one of two ways, depending on your coverage:

You pay only your co-pay fee before a therapy session. You do not need to meet a deductible, so you would not need to pay the full session fee.
Your insurance plan requires you to meet your annual deductible before a co-pay fee applies (before you pay only your co-pay for each session). This means you could expect to pay your full session fee for up to several sessions. You can also help meet your deductible by paying for other qualified medical expenses (e.g. prescriptions, medical services, etc.).

Paying For Therapy with Health Insurance / Out-of-Network Therapist
Assuming your plan includes reimbursement for sessions with an out-of-network psychotherapist:

You pay the full session-fee yourself (“out-of-pocket”) for each therapy session
Then, a claim is submitted to your insurance company for reimbursement.

Reimbursements from your insurance company are typically in the form of a check, made payable to you. A reimbursement claim may be submitted after every session, or in aggregate every month (known as a “superbill”).

The reimbursement amount is not based on what your therapist charges per session. Instead, the reimbursement is a predetermined allowable amount that the insurance company sets / determines to be a reasonable charge per session. The amount will vary by geography and therapist degree / licensure, and is not negotiable. Insurance companies do not typically disclose these amounts, so it can be difficult to know exactly how much will be covered until you submit your first claim and receive reimbursement.

“Superbills” for Out-of-Network Providers
IntraSpectrum Counseling’s Client Services team is happy to help our out-of-network clients who have insurance questions. And to help make your therapy experience as stress-free as possible, if you have out-of-network insurance benefits and coverage, our Client Services team can submit the out-of-network reimbursement claims to your insurance carrier on your behalf.

Once the insurance company processes the claims, they send reimbursement directly to you, at whatever rate your out-of-network benefits stipulate. The reimbursement amount depends on your specific health insurance plan and it may not be possible for us to determine the specific amount of reimbursement you’d receive until after the first session(s) begin to process.

Special Notes About Insurance & Diagnoses

If you plan to use (or already are using) your health insurance to help pay for psychotherapy, you should be aware that when your therapist / group practice submits a session to your health insurance provider for coverage, part of the required information is a diagnosis. In fact, even if you don’t use your health insurance to cover the cost of individual, family or group therapy, you likely have a diagnosis in your file anyway.

A psychological diagnosis is defined as a condition that impacts your mood, thinking, or behavior. Having a diagnosis is a medically-accepted practice that helps facilitate the appropriate therapy for you. And it typically doesn’t impact clients in any negative way since health insurance coverage makes therapy much more accessible, and HIPAA (Health Insurance Portability and Accountability Act) protections keep your personal information private, secure, and accessible. For the purposes of client advocacy, there are a few scenarios that while uncommon, people should consider about a psychological diagnosis when using health insurance:

If you and your spouse(s) / significant other(s) are in relationship therapy, only one of you will typically have a diagnosis in your file, and that will be the person whose health insurance is being used to cover the sessions. This usually doesn’t create a negative impact for anyone involved, but you should know that health insurance records (including diagnoses) could potentially be used as evidence in future court proceedings (e.g. divorce or custody cases).
There are practical or contractual implications of some diagnoses for certain professions (e.g. military / airline pilots, nurses, etc.)
Mental health records (including diagnoses) maintained by your therapist or by your health insurance provider are an important part of the required documentation for mental health disability claims. In warranted cases, therapists can work with clients to assist with this process, in some cases filing on a client’s behalf.

Discussing a diagnosis can be difficult for both you and your therapist, but it’s an important conversation. You have the right to speak with your therapist about diagnoses (e.g. if they are giving you a diagnosis, what that diagnosis is, what their reasons are). Just remember that if you are using health insurance, a diagnosis is likely required – but that you have the right to be part of that discussion.

Other Options, to Help Pay for Therapy
If you’re finding it difficult to connect with a new in-network therapist, if out-of-network session fees are out of reach, or if you are underinsured or have a high deductible plan – there are still ways to offset the cost of therapy.

Health Savings Accounts (HSAs) and Flexible Spending Accounts (FSAs)
HSAs / FSAs are two ways that employees can help cover health-related expenses (including copays and coinsurance for psychotherapy) through a tax-free account. You cannot enroll in both an HSA and an FSA, but employers may offer both options. With an HSA / FSA, you set aside funds for anticipated medical expenses through payroll deductions, which also reduces your taxable income.

HSAs allow you to contribute up to $3,450 per year, to roll over unused balances to the next year, and to transfer balances as you change employment. There are typically eligibility requirements, including being enrolled in a high-deductible health plan.
FSAs have a lower contribution cap ($2,650) and you forfeit any unused balances in a given year, but they don’t have eligibility requirements.

HSAs / FSAs can be good options to consider if:

you have a high deductible in-network plan and want to find ways to reduce out-of-pocket therapy costs
you have high out-of-pocket medical expenses for items not typically covered by health insurance (OTC medications, eyeglasses, menstrual products, first-aid supplies, etc.).
you’re looking to use tax-free accounts through your employer

Ask your employer if one or both of these options are available as an employee benefit.

Psychotherapy Groups
Depending on your specific concerns and your goals for psychotherapy, group therapy might be an excellent cost-effective option. Psychotherapy groups can be an effective treatment for helping folks heal from emotional difficulties, learn new skills, increase relationship and social connections, and address a variety of concerns and issues. This is true for a few reasons:

First, most members identify with issues other members share and find they are helping themselves just by being present and processing the issues vicariously.
Similarly, by listening and giving feedback to group members sharing their concerns, you may also be practicing new ways of interacting with others.
Group therapy offers the opportunity to get multiple perspectives, increased support from peers, and a safe place to try out new behaviors and ways of being.
The goals and objectives of group therapy often involve practical tactics to help address specific issues, both during group sessions and outside the group therapy environment.

Therapy groups have a set start and end-date, and cost less than one-on-one individual therapy sessions (usually between $50-$75 per session, which is generally covered by health insurance plans that include mental health benefits).

Glossary

CLAIM: an invoice that you or your therapist forwards to your insurance company, seeking reimbursement for session(s) paid / services rendered.
CO-PAY: the fee, set by your in-network insurance company, that you pay for every therapy session once your deductible is met.
CO-INSURANCE: a type of insurance plan where the client pays a percentage share of the session fee, after their deductible is met.
DEDUCTIBLE: the sum total of medical costs you need to pay each year before your co-pay fee applies / insurance coverage begins.
FSA (FLEXIBLE SPENDING ACCOUNT): a type of pre-tax savings account offered by some employers. FSA contributions are made via payroll deductions and can be used to pay for anticipated qualifying medical expenses. FSAs typically do not have eligibility requirements, but unused funds are forfeited at the end of each year. FSAs differ from HSAs (see below).
GROUP THERAPY: an effective form of psychotherapy in which a number of people meet together for a series of scheduled sessions under the guidance of professionally-trained therapists, to help themselves and one another.
HMO (HEALTH MAINTENANCE ORGANIZATION): A type of health insurance plan that typically limits coverage to providers who are in-network only. HMOs feature lower monthly premiums but less flexibility in out-of-network coverage. If you have this kind of plan, your options may be limited in-network, but it could be much more expensive to see an out-of-network therapist. You are also typically required to see a primary care physician for a referral to therapy before your insurance company will provide coverage.
HSA (HEALTH SAVINGS ACCOUNT): a type of pre-tax savings account offered by some employers. HSA contributions are made through payroll deductions, and funds can be used to pay for anticipated qualifying medical expenses. HSAs feature eligibility requirements and allow you to carryover balances if you change jobs. HSAs can be a good option for those with high-deductible in-network plans or out-of-network plans that do not offer reimbursement. HSAs differ from FSAs (see above).
OUT-OF-POCKET: Your own money – dollars paid by you rather than by your health insurance company.
PPO (PREFERRED PROVIDER ORGANIZATION): A type of health insurance plan that may have higher monthly premiums, but offers more flexibility in out-of-network coverage. If you have this kind of plan, your costs to see in-network vs. out-of-network therapists may be comparable.
PSYCHOTHERAPY GROUPS: another term for Group Therapy, see above.

Confirm Your Health Insurance Coverage
We hope this information makes health insurance coverage seem a little less confusing. And now that you know the basics, a great next step is to call your insurance company with specific questions about your coverage & benefits. Speaking with a knowledgeable representative at the source is the best way to get accurate and complete information. Have a pen & paper handy for notes, and prepare a list of questions in advance, which could include:

What is my annual deductible / do I have one?
Do I need to meet my deductible before I have coverage for appointments?
What is my co-pay fee for psychotherapy sessions?
What is my co-insurance for outpatient mental health?
Do I need a referral from my primary care physician or an in-network psychotherapist to see an out-of-network psychotherapist?
Is (name of therapist / practice) in-network?
Does my insurance cover Psychotherapy Groups?
Does my insurance cover family therapy or relationship therapy?

IntraSpectrum Counseling Can Help
If you’re searching for a new therapist, our best advice is to do what feels most manageable for you right now. Whether you look in-network or out-of-network, pay out-of-pocket with an HSA or FSA, join a psychotherapy group, or find short-term duration therapy – what’s most important is that you connect with a therapist who can help with reaching your therapeutic goals.

And whether you’re already an IntraSpectrum client or are interested in getting started with therapy at IntraSpectrum, we can help with insurance questions. Every day, our Client Services team assists clients who have questions about using their health insurance to pay for therapy. Email us at help@intraspectrum-chicago.com or leave a message for a callback on our office line (312-379-9476). And if you need affirming and validating support for individual, relationship, adolescent, family or group therapy, submit an inquiry form online to get started.

PLEASE NOTE: we always recommend you also call your health insurance carrier directly, to verify your own coverage and benefits.