Does Insurance Cover Therapy? Your Complete Guide to Mental Health Insurance Coverage

We’ve said it before and we’ll say it again: Finding affordable mental health care shouldn't be so complicated. 

When you're ready to start therapy, understanding your insurance options can feel overwhelming. The good news? Most insurance plans do cover therapy, but the details vary significantly between plans and providers.

Does Insurance Cover Therapy? The Short Answer

Yes, most health insurance plans cover therapy and mental health services. Since the Mental Health Parity and Addiction Equity Act of 2008, insurance providers must offer mental health coverage that is comparable to their physical health coverage. 

However, how much coverage you have, what types of therapy are covered, and which providers you can see depends on your specific health insurance plan.

Types of Insurance Coverage for Therapy

Insurance coverage for therapy generally falls into two categories: in-network and out-of-network benefits. Understanding the difference can help you make informed decisions about your care.

In-Network Coverage for Therapy

When a therapist is "in-network" with your insurance provider, they have a contract with your insurance company and agree to accept predetermined rates for their services. Here's what that means for you:

• (Usually) lower immediate costs: You typically pay only a copay at each session (ranging from $0-85, depending on your plan).
• Direct billing: Your insurance pays the therapist directly for the remainder of their contracted rate.
• Less paperwork: You don't need to submit claims for reimbursement.
• Possible limitations: Your sessions may be limited to a certain number per year or you may need to receive a formal diagnosis to continue treatment.

Example: If your copay is $25 and you see an in-network therapist once weekly, you'll pay $25 per session directly to your therapist, while your therapist and your insurance company handle the rest.

Out-of-Network Coverage for Therapy

When a therapist is "out-of-network," they don't have a direct contract with your insurance company. However, many insurance plans still provide coverage through out-of-network benefits:

• Higher upfront costs: You pay the full fee upfront to your therapist. 
• Reimbursement option: You submit claims to your insurance company for partial reimbursement.
• More provider choices: You can choose any licensed therapist instead of working only with therapists who have contracts with your insurance company.
• Fewer insurance restrictions: Your therapy isn't limited by insurance company session restrictions.
• Greater privacy: Out-of-network treatment often has fewer reporting requirements to insurance companies.

Key Insurance Terms You Need to Understand

To maximize your mental health benefits, you need to understand these key insurance terms:

Deductible

Your deductible is the amount you must pay out-of-pocket for healthcare services before your insurance begins to pay. This amount resets annually, usually on January 1st.

Example: If your deductible is $1,500 and you're paying your therapist $150 per session, you'll pay for 10 sessions out-of-pocket before your insurance benefits activate.

Individual vs. Family Deductible

An individual deductible applies to one person's covered expenses while a family deductible is met when covered expenses for all family members on the plan combined reach the deductible amount.

For therapy coverage, this means you might meet your individual deductible faster if other family members have had medical expenses, particularly if your plan has a family deductible structure.

Copayment (Copay)

A copay is a fixed amount you pay for a covered healthcare service. For in-network therapy, copays typically range from $0-85 per session.

Coinsurance

After meeting your deductible, you may be responsible for a percentage of costs (coinsurance) rather than a fixed copay. For example, with 20% coinsurance, if a therapy session costs $100, you pay $20 and insurance covers $80.

Out-of-Pocket Maximum

This is the most you'll pay during a policy period (usually a year) before your insurance begins to pay 100% of the allowed amount. This can be an important safeguard if you need ongoing support. 

Percentage Reimbursement

For out-of-network care, after meeting your deductible, insurance typically reimburses a percentage of your session fee.

Example: If your out-of-network benefit is 70% reimbursement after meeting a $1,000 deductible, and your therapist charges $150, you'd initially pay $150 per session. After meeting your deductible, you'd receive $105 back from insurance (70% of $150), making your actual cost $45 per session.

Allowable Amount

Some insurance plans have an "allowable amount" – the maximum they'll consider when calculating reimbursement, regardless of what your provider charges.

Example: If your therapist charges $200 but your insurance's allowable amount is $150, they'll calculate reimbursement based on $150, not the full $200.

Major Insurance Providers and Their Mental Health Coverage

Different insurance companies offer varying levels of mental health coverage. Here's an overview of what to expect from major providers:

• Aetna offers both in-network and out-of-network benefits for mental health services, with many plans covering both in-person and virtual therapy.
• Blue Cross Blue Shield provides various mental health coverage options depending on your specific plan. BCBS typically has a large network of providers and often covers both in-network and out-of-network services.
• Cigna is known for their behavioral health network and reimbursement options. They offer comprehensive mental health coverage and have been expanding their telehealth options.
• UnitedHealthcare partners with many mental health providers nationwide and offers various levels of coverage based on your plan.
• Anthem offers telehealth and in-person therapy options and has been increasing their mental health provider network.
• Evernorth Behavioral Health specializes in mental health coverage with a focus on accessible care options.
• Empire Blue Cross Blue Shield (New York's largest provider) offers extensive mental health coverage with both in-network and out-of-network options.

How to Verify Your Therapy Insurance Coverage

Before starting therapy, I recommend taking these steps to understand your coverage:

1. Call your insurance provider: Use the number on your insurance card and ask:

• "What is my deductible for mental health services, both in-network and out-of-network?"
• "What is my deductible for mental health services, both in-network and out-of-network?"
• "How much of my deductible have I already met this year?"
• "What is my copay or coinsurance for mental health services?"
• "What percentage am I reimbursed for out-of-network behavioral health care?"
• "Is there an 'allowable amount' for behavioral healthcare?"
• "Do I need a referral from my primary care doctor for mental health services?"
• "How many therapy sessions are covered per year?"
• "Does my plan cover telehealth therapy sessions?"
  

2. Document everything: Write down the representative's name, the date of your call, and all information provided. This can be helpful if there are any billing issues later.‍

3. Verify with potential therapists: Once you find a therapist, confirm that they accept your specific insurance plan. Insurance websites can be outdated, so direct confirmation is essential.

Why Some Therapists Choose Not to Accept Insurance

Many highly qualified therapists choose not to participate in insurance networks. 

This doesn't reflect their quality of care but rather concerns about the insurance system itself:

• Insurance reimbursement rates have remained stagnant for decades, not keeping pace with rising costs of practice.
• The administrative burden of insurance paperwork can take time away from client care.
• Some insurance panels are "closed," meaning they aren't accepting new providers.
• Insurance companies may limit the number or frequency of sessions.
• Therapists must provide a diagnosis for insurance coverage, which may not be appropriate for all clients.
• Some therapists have privacy concerns regarding what information must be shared with insurance companies.

Making Therapy Affordable: Beyond Traditional Insurance

If you're concerned about therapy costs, consider these options:

For In-Network Care:

• Consider group therapy, which is often covered at a lower copay.
• Inquire about telehealth options, which might have more availability.

For Out-of-Network Care:

• Ask about sliding scale fees (some therapists adjust their rates based on financial need).
• Use health savings accounts (HSAs) or flexible spending accounts (FSAs).
• Submit claims for out-of-network reimbursement.
• Consider therapy frequency (bi-weekly instead of weekly).
• Look into university training clinics with supervised student therapists.

Other Options:

• Employee Assistance Programs (EAPs) often provide free short-term counseling.
• Community mental health centers often offer reduced-fee services.
• Support groups can provide valuable connections at little to no cost.

How to Use Out-of-Network Benefits Effectively

If you decide to see an out-of-network therapist, follow these steps to maximize your benefits:

1. Get a detailed receipt: Ask your therapist for a "superbill" after each session. This should include:

• The therapist's name, license type, and NPI number
• The date of service
• CPT code (procedure code, usually 90791 for initial assessment or 90834/90837 for therapy sessions)
• Diagnosis code (ICD-10 code)
• The session fee

2. Submit claims promptly: Most insurance companies have deadlines for claim submission (often within 90 days of service).

3. Keep detailed records: Track all submitted claims, reimbursements received, and communications with your insurance company.

4. Appeal denials if necessary: If your claim is denied, you have the right to appeal. Your therapist may be able to help with this process.

How MyWellbeing Can Help You Navigate Insurance

Finding the right therapist who fits your budget shouldn't be difficult. 

At MyWellbeing, we've helped thousands of people navigate both in-network and out-of-network options. Our matching service considers your insurance needs and therapy preferences.

We can help you:

• Find in-network providers who are actually accepting new clients
• Connect with out-of-network therapists who offer sliding scale rates
• Understand your specific insurance benefits
• Navigate the reimbursement process
• Find alternative affordable options if needed

Instead of spending hours searching and calling therapists only to find they're not accepting new clients or don't take your insurance, let us do the work for you. Our matching service is free, and we've helped thousands of people find affordable care that fits their unique needs.

Is Therapy Worth the Investment?

Therapy is an investment in your mental health and overall wellbeing. Consider the costs of untreated mental health concerns:

• Decreased quality of life
• Strained relationships
• Physical health complications
• Reduced productivity at work

When viewed this way, therapy can be not just an expense, but an investment with significant returns in your quality of life, relationships, and even career potential.

Taking the Next Step

Understanding your insurance coverage for therapy may seem complex, but it's worth the effort to access the mental health care you deserve. Whether you choose an in-network provider or decide to explore out-of-network options with reimbursement, investing in therapy is investing in yourself.

Ready to find your therapist match? Take our free questionnaire now and let us connect you with providers who match your insurance needs, budget, personality, and therapeutic goals.

Remember, your mental health is worth the investment. Let's help you find the right support at a price that works for you.