A study published in JAMA Psychiatry found that psychiatrists are less likely than other health care professionals to accept insurance. Some sources report similar numbers for therapists, psychologists, and others in the mental health care profession. This may decrease access to quality mental health care and prove frustrating for both therapists and clients.
While therapists who accept insurance may see more clients, insurance reimbursement is not a panacea for the many challenges of running a practice. Each therapist must weigh the benefits and drawbacks of accepting insurance, then decide which insurance panels and approach to insurance payments will offer the most benefits with the least amount of hassle.
therapist insurance: basics to accept insurance
Therapists have two options for accepting insurance:
Join a vendor panel
Therapists interested in receiving direct reimbursement from insurance companies can join the insurers’ panel of preferred providers. this usually requires a fairly intensive application process, and approval can take several months. however, once the therapist is approved, the insurer pays the therapist directly for her services. Being on a provider panel can also offer some marketing benefits because most insurers have a directory of preferred providers that potential customers can use to find you.
be an out-of-network provider
Some therapists choose to give their clients documents (called superbills) so that clients can receive reimbursement from their insurer. These out-of-network providers generally accept payment directly from clients. then it is the customer’s responsibility to seek reimbursement from the insurer. some therapists work with clients to make this strategy more affordable. you could, for example, only bill the customer once you’ve received the refund. however, there is no guarantee that the client will be reimbursed and, therefore, there is no guarantee of payment for services if payment is not received in advance.
benefits of accepting insurance for therapists
disadvantages of accepting insurance for therapists
Accepting insurance is not a viable strategy for all therapists. some of the drawbacks include:
- a time-consuming process. If you choose to become a preferred provider, you will need to apply to each individual provider’s panel. this may require researching the best boards to put together and completing mountains of paperwork.
- reimbursement rates. reimbursement rates are not always consistent with a therapist’s standard fee. sometimes they are as low as $60 to $80 an hour.
- No balance billing. If you are a preferred provider in an insurance panel, you cannot participate in balance billing. this is the practice of billing a customer for the difference between the reimbursement fee and their usual fee. however, if you are an out-of-network provider whose clients request reimbursement, you may bill your clients for the full amount.
- complex billing. If you choose to accept insurance, you will need to follow the insurance provider’s billing requirements. out-of-network providers must create superbills that contain the proper billing codes.
- service coverage. Not all therapy services will be covered. The federal Mental Health Equity and Addiction Equity Act requires insurers to cover mental health services at similar rates and under similar criteria as physical health problems. in practical terms, however, there are many disparities. You may have to fight for coverage of certain services or diagnose a client with specific conditions to provide approved types of care.
- Payment delays. In general, insurers must pay a claim within 30 days. however, if the claim is denied, you may wait longer pending an appeal. they may not even pay you at all.
- Which insurers are the most popular in your area? it is usually better to join the large panels as they cover more clients.
- what is the reimbursement rate for each provider panel?
- what requirements do you need to meet to receive the rebate?
- what are other therapists saying about provider panels in your area? ask around. You may find that some insurers are very difficult to work with, even if they seem good on paper.
- do you meet the accreditation requirements for the most attractive supplier panels? If not, how costly and time consuming would it be for you to meet these requirements?
- Which provider panels offer additional services to preferred providers? Are there insurers that include providers in a directory?
best insurance panels for therapists: how to choose
When evaluating whether to accept insurance, it’s important to consider what options are available in your area. many therapists take a middle-of-the-road approach, handing their clients superbills for reimbursement without directly accepting insurance payments. This is a good option for therapists who want to see more clients, but don’t have the time or inclination to apply for insurance panels.
For therapists interested in joining a provider panel, it is important to weigh the benefits of each specific provider panel. consider the following:
Therapists may also consider becoming a Medicaid provider, as this may allow them to serve more children and low-income individuals.
goodtherapy helps therapists manage and market their practices with a host of continuing education seminars, practice management tips, and more. We list members in our directory, which is a very popular source of therapist referrals. join today.
- bishop, t. f., press, m. J., Keyhani, S., & pincus, h. a. (2014). Acceptance of insurance by psychiatrists and implications for access to mental health care. jama psychiatry, 71(2), 176-181. doi:10.1001/jamapsychiatry.2013.2862
- centre, a. (2012, December 17). mental health billing: 10 common questions and answers. American Counseling Association. retrieved from https://www.counseling.org/news/aca-blogs/aca-member-blogs/aca-member-blogs/2012/12/17/mental-health-billing-10-common-questions-and- answers
- dear, b. (2017, May 21). Should I take insurance therapy clients or just pay out of pocket? retrieved from https://simple.icouch.me/blog/should-you-accept-insurance-or-just-self-pay-therapy-clients
- dembosky, a. (2016, July 14). Frustrated by not being able to find a therapist? they are also frustrated. retrieved from https://www.npr.org/sections/health-shots/2016/07/14/481762357/frustrated-you-can-t-find-a-therapist-they-re-frustrated-too
- Does your insurance cover mental health services? (North Dakota.). retrieved from https://www.apa.org/helpcenter/parity-guide
- the law of equity in addictions and parity in mental health. (North Dakota.). retrieved from https://www.cms.gov/cciio/programs-and-initiatives/other-insurance-protections/mhpaea_factsheet.html