You pay thousands every year for medical coverage, of course you want to get your money’s worth. I get it. I use my insurance too, because honestly, I can’t afford not to. But I’ve also racked up thousands in medical bills at my local hospital for things insurance didn’t cover. And every time, I found myself asking, “Wait…what the hell is my insurance even paying for?”
As a professional, I have spent literal hours on the phone with insurance companies fighting for payment or coverage for medically necessary care on behalf of my clients — care that the insurance company didn’t think was necessary.
As someone seeking therapy, it’s important to understand exactly what using insurance for mental health care really means. Keep reading to weigh the risks and benefits.
The Benefits
For many people, insurance is the most realistic way to access mental health care and reduce out-of-pocket costs. It’s important to contact your health plan to understand exactly what mental health services are covered. Often, you’ll have a small copay, but some plans require you to meet a deductible before insurance begins paying. Either way, a therapist’s contracted rate with an insurance company is typically lower than their private-pay fee, and therapists who accept your insurance can only charge you the contracted rate.
The Risks
To use your insurance for therapy, services must be considered medically necessary. This means your insurance typically requires a mental health diagnosis, which becomes part of your permanent medical record. That information is accessible to your insurance company, your healthcare providers, and, in rare but real cases, third parties—such as courts, life insurance companies (which could affect premiums), or employers conducting background checks, though your consent is required.
Insurance companies can also limit how and how often you can engage in therapy. They may cap the number of sessions per week, month, or year. They can deny certain levels of care—even if you and your therapist believe it would be helpful—if they determine it is not medically necessary. In some cases, they may audit your therapist’s records and retroactively decide that sessions should not have been covered, requiring the therapist to repay the insurance company. This can potentially interrupt your services if the therapist is unable to be reimbursed for their time. This is inclusive of those seeking out of network benefits by submitting a “super bill” for reimbursement.
Other Considerations
Some people come to therapy looking for support, but they don’t actually meet diagnostic criteria for anything an insurance company would cover. Does this mean they don’t need therapy? No. It means their needs may be focused on personal growth, life transitions, or emotional support—valuable work that just doesn’t fit neatly into an insurance framework.
My wonderful financial advisor once told me that while he wants me to save my money, he also wants me to spend it on experiences—things that stick with you for years, like making memories. I apply that same philosophy to mental health. Many people are comfortable spending hundreds of dollars out of pocket on hair cuts/color, dining experiences, fitness memberships, coaching, housekeeping, travel and more—so why not invest in your mental health?
As someone starting out in private practice, I chose to accept a small number of insurance plans to make therapy accessible for those who truly can’t afford out-of-pocket costs. But I feel much more in control of your care when I don’t have to rely on insurance to decide whether it’s “medically necessary.” To me, if you’re seeking support and care, it is absolutely necessary.
For more information, or to book a consultation, reach out to me at beth@northlightcc.net or by phone (207) 436-4026.