Insurance: Frequently Asked Questions

Counseling and Insurance: It should be simple and easy… but, it’s not.

Unfortunately, using insurance to pay for counseling, or even deciding if it is in your best interest to use insurance, often is neither simple nor easy. I’ll be candid, as a counselor in private practice I remain in dilemma with issues related to insurance. I certainly want to be as accommodating as possible to my clients and also help them to make counseling as affordable as possible. At the same time, as things stand today there are several obstacles and intrusions that complicate the use of insurance for both the counselor and the client.

It remains to be seen if the Affordable Care Act (ACA) will eventually make this easier or more burdensome. As it stands now, it seems the insurance companies are still largely in the driver’s seat. While it’s certainly understandable you’d like to have your insurance help with the cost of counseling, there are still several issues I strongly encourage your to consider before making that determination.

On this page you’ll find some of the more common questions my clients have about insurance. If you can’t find your answer here, please don’t hesitate to call and ask me personally. While I am NOT AN INSURANCE EXPERT – and ultimately you’ll need to check with your insurance company for final answers, I’m happy to assist you if I can.

Do You Accept Insurance?

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I do not currently “accept insurance” in the sense of being a provider on the panels with specific insurance companies; however that does not necessarily mean you cannot receive insurance reimbursement for our work together. The details of your insurance policy determines if you can be reimbursed for our counseling work and under what terms. This will vary between insurance companies and specific policies, so you will need to determine the terms of your coverage with your insurance company. I will be pleased to guide you with how to get that information if you are interested in working with me.

How do I get paid from Insurance if you don’t file the claims?

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I will provide you with invoices, statements, and “Superbills” to use for filing claims with your insurance company. Some insurance companies will simply accept the invoice or Superbill and make payment from that, without requiring you to fill out a separate claims form. If you do need to fill out claims forms, all the information you should need will be on the materials I provide to you. Occasionally there are specific sections on insurance claims forms that must be completed by the provider of services, in which case I will be pleased to do that for you.

I have a Managed Care (or PPO) plan. Will insurance pay if you’re not in their network?

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Managed care companies do prefer for you to work with their “approved providers”; however many managed-care policies will allow you to use an “out of network” provider. Most often managed-care companies reimburse you at a different rate for “in-network providers” versus “out of network” providers. So, quite often you will have the option to use a counselor who is not on their providers list, but your reimbursement rate will probably be somewhat less.

Some managed-care companies will do an “ad hoc contract” with providers outside of their network, especially if client has particular reasons for wanting to use a specific counselor. This means they agree to a one time contract with a provider outside of their network to serve that specific client. I have occasionally engaged in these contracts and I am not opposed to doing this with individual clients; provided I can arrange for mutually agreeable terms with the insurance company (reimbursement rate, pre-approval requirements, documentation, treatment planning, etc.)

If I file a claim and it is denied, will you assist me in making an appeal?

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Yes. Although I’ve elected not to participate on insurance panels and do not file claims directly, I am absolutely committed to you receiving every bit of reimbursement to which you are entitled. When a claim for counseling services is denied the provider of those services almost always needs to be directly involved in the appeals process.

I will make the needed phone calls, complete appeals forms, and verify with your insurance company your use of counseling to help you receive your insurance payments for any legitimate claims you file. However, please be aware I do not actively ‘advocate’ on your behalf. Ultimately, your insurance policy is a business contract between you and that company.

What is meant by Medical Necessity?

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“Medical Necessity” or “Medically Necessary” are terms used in reference to whether or not a procedure (treatment) is NEEDED to assure a person’s health. These terms traditionally referred to medical issues, but are applied by insurance companies to mental health services as well.

Since the insurance company defines and determines “medical necessity”, it places the burden for proof on the client and therapist that counseling is a necessary treatment and directly related to the client’s health. This often creates complications, because one of the best uses of counseling is to prevent problems from becoming worse and getting to the point that they would affect the client’s health.

But if the situation has not yet caused a health problem, counseling will likely not be considered medically necessary. For example, a couple seeks counseling because when the husband is under stress he belittles and provokes arguments with his wife. This would probably be considered a marital issue and not to be medically necessary. However, if it progresses to the point that he strikes her, or she develops an anxiety disorder, then it would be medically necessary, because it directly affected her health. Most denials for counseling payment are based on not meeting “medical necessity”.

I have insurance that covers counseling. So, why wouldn’t I use it?

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Of course, everyone wants to take advantage of their insurance and save some money! I live with a family budget too, so I understand!

But, there are several reasons you may want to pay for counseling services “out-of-pocket”, rather than using the insurance coverage. This is especially true with managed-care policies, which have as part of their purpose to limit services to the bare minimum “necessary”. And of course, they determine what is necessary. Some of the reasons you might want to consider paying the cost of counseling out of pocket instead of using insurance include:

  1. Confidential and privileged information nearly always must be given to the insurance company in order to have services approved or to be paid for services. This information may be passed on, even without your consent. [A lengthy, but thorough, paper on potential abuse of confidential information by the insurance industry can be read here.]
  2. Counseling services can be delayed and/or interrupted due to insurance denying initial approval or resisting the approval of additional treatment beyond a first few sessions.
  3. Insurance companies often initially deny payment for counseling, even when the use is quite legitimate. Insurance companies base their approval for payment on “medical necessity”, which they define and determine. In other words, they make the client and counselor prove to them there is a need for counseling that is directly related to the client’s health. If your claim is denied you do have the right to an appeal process; however the appeal process can be tedious, time-consuming, and stressful for the client.
  4. Insurance payments for counseling nearly always requires assigning a diagnosis of a mental health disorder. Many appropriate uses of counseling do not involve an actual pathological condition. Counseling for family problems, marital difficulties, adolescent angst and similar issues quite often are not covered by insurance, unless the behavior becomes serious or it is considered part of a more severe mental health disorder. When a legitimate mental health disorder exists, once the diagnosis is presented to the insurance company it becomes part of the client’s permanent medical record and may have future implications (difficulty changing insurance, ineligibility for certain jobs, denial of life insurance, etc.) This is especially concerning when it involves children or adolescents clients. I have worked with clients as adolescents who years later were denied enrollment into the Air Force Academy and law enforcement jobs based on their diagnoses; despite my writing on their behalf that treatment was successful and their past difficulties had no impact on their current functioning.
  5. If you need or want to change insurance companies in the future, your rates may be higher (or you may be denied insurance) due to your medical record showing a history of using insurance for treatment of a mental health disorder.

Why would I choose to work with you, if I can’t use my insurance to pay for it?

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That’s a good question and I hope you’ve already read the other sections about pros and cons of using insurance to pay for counseling. I have tried to make available on this site sufficient information about the implications of using insurance to allow clients to make a well informed decision. While I appreciate the natural desire for saving money wherever possible, I believe these issues are worth your earnest consideration before using insurance for short term counseling.

That being said, I hope you would consider using me as your counselor even if it costs you a bit more, because of the value you’ll receive from my considerable experience. I have been a mental health professional and counselor without interruption for 34 years. I long ago lost count of the total number of clients with whom I’ve worked, but it is well into the thousands. I have experience with a wide range of clients, from prenatal to seniors, from impoverished to very wealthy, from high school dropouts to those with doctorate degrees. I have also practiced my profession in a wide variety of settings, which has provided me a functional understanding of how the influences of schools, psychiatric care, public service agencies, residential treatment, support groups, and so forth can impact and/or support clients. During the three decades of my career I have continually been learning and acquiring additional skills to increase my competence as a therapist. At the risk of sounding like I’m “blowing my own horn”, I do believe my 30 plus years of learning and experience combined enables me to be more effective in my work with you and contributes to resolving your concerns in the shortest time possible.

Will you adjust your fees to match my managed care rates?

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If you currently have a managed care policy and choose not to use them for your counseling, I’d be pleased to discuss with you options about adjusting my fee. However, I cannot guarantee that I can match the rates of your policy.

There are two factors that contribute to this. First, managed care companies contract with counselors to accept a fee that is lower than the counselor’s standard rates. In exchange for accepting reduced fees the counselor receives referrals from the managed care company, which is a benefit I would not have.

Second, the various managed care companies reimburse at very different rates, some of which are unreasonably low. But if you would like to work with me and are willing to do without your managed care payments, I will certainly make every effort to reach a mutually agreeable arrangement with you.