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    A male patient speaking with a female psychologist during a therapy session.

    Does Health Insurance Cover Mental Health Therapy? [Complete Guide]

    7 mins

    In the years since the introduction of the Affordable Care Act, better healthcare has come within reach for many Americans who previously went without. Now, people across the United States can see specialists and other physicians without worrying about financial ruin. 

    We can afford to care for our bodies, but what about our mental health? Does health insurance cover therapy or counseling?

    Thanks to federal mandates like the ACA, you can expect medically necessary mental health, behavioral health, and substance use treatment services to be at least partially covered by your health insurance. Simple enough, but where insurance is concerned, you should always take a deeper look. 

    In this complete guide, we’ll review what’s covered and what you might be expected to pay. Keep reading more to find the answer to the question, “Is therapy covered by insurance?”

    Does Insurance Cover Mental Health Therapy?

    Several factors, including the Affordable Care Act and The Mental Health Parity Law being passed, have ensured that medical insurance covers therapy and other mental health services. 

    That parity law, the Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act, ensures that your insurer must offer coverage comparable to its physical health coverage offerings.

    The Mental Health Parity Law: What Does It Do?

    The Mental Health Parity Law, MHPAEA, protects insurance beneficiaries like you from unfair coverage restrictions on mental health, behavioral health, and substance abuse treatment services. It creates parity -- that is, it makes sure that the treatment you can receive, the management of your care, and how much you pay out-of-pocket for mental health services like therapy are comparable to the benefits you receive for physical health services. 

    Because of parity, insurers cannot legally limit your access to in-network mental health providers.

    How Different Types of Medical Insurance Cover Therapy

    Let’s look at a few of the most common sources of insurance and whether they will cover mental health services.

    • If your job employs 50 or more full-time workers, the company must provide health insurance. While this means that some mental health services like therapy will be covered, past that point, the specifics of what services are covered depends on the plan. 

    Some employers provide insurance that covers a full spectrum of mental and behavioral health services, others may only cover the minimum. You will need to consult your plan’s details to find out exactly what you can expect your insurance to cover.

    • Marketplace plans purchased from HealthCare.gov and state-level marketplaces cover mental health and substance use disorder services. Per HealthCare.gov, the ACA requires that all plans sold in the Marketplace must offer the following benefits:

      • Coverage for psychotherapy, counseling, and other behavioral health treatments

      • Inpatient services as they relate to mental and behavioral health, like treatment for dementia and sleep disorders

      • Substance use disorder treatment

    • All Medicaid programs are required to cover mental health and substance abuse services, meeting minimum coverage of essential health benefits. Parity, however, may vary from state to state. You will need to check your state’s Medicaid website to verify that it adheres to the mental health parity law.

    • CHIP (Children’s Health Insurance Program) provides generous mental health coverage for children and, in some states, people who are pregnant.

    • While Medicare does offer mental health coverage, what’s provided depends on the Medicare component.

      • Medicare Part A covers inpatient mental health care -- care you receive after being admitted to a hospital.

      • Part B covers outpatient mental health care, as well as the care you might receive from a therapist or at a clinic.

      • Part D handles many prescription drugs used to treat mental illness.

      • Medicare Advantage, or Part C, can be expected to provide coverage equal to or better than the above.

    A female therapist speaking with her female patient
    Shironosov via Getty Images

    How to Know if Your Health Insurance Plan Covers Therapy

    So, you know which insurance sources offer coverage for mental health services, and whether or not they offer parity with physical health service coverage, but how do you tell if your plan, in particular, covers things like therapy?

    • Check your plan’s summary of benefits. When determining if therapy is covered by your insurance, looking at the details of your plan’s policy is the most direct way to tell what services are covered. If you don’t have a physical copy of the documentation, you should be able to access it online. 

    Head to your insurer’s website, register, and log in! Your insurer’s website is a great resource for seeing plan details, in-network providers, and drug formularies. Consider making it your first stop.

    • If you have employer-sponsored coverage, ask the HR department or your administrator. Your company will either have someone on staff or an agent from your insurance company who can help you to understand your coverage.

    • Call your insurance company. A representative can get you a copy of your plan’s summary of benefits and answer questions about it.

    • Check with a provider directly to see if they accept your insurance. If there’s a therapist you would like to use, you can call their office directly to see if they accept your insurance.

    5 Things to Consider When It Comes to Therapy Coverage

    While most health insurance options do provide coverage for mental health services, actually getting that therapy session paid for is a little more complicated than just handing over your insurance card. Here are some things to consider when shopping for insurance or a mental health professional:

    1. You can still seek services even if your provider doesn’t accept insurance. Many mental health providers do not accept insurance because of low reimbursement rates. If the provider you plan on seeing is out-of-network or does not accept insurance, you may be responsible for the entire bill. You can find out whether a particular therapist or psychiatrist accepts your insurance or if they’re in-network with your plan by calling their office or checking their website, usually.

    2. Depending on the plan you have, you may be responsible for meeting a deductible before services will be covered. There are many services, like preventative care (screenings and annual check-ups), that will be covered by your insurance whether or not you've met that deductible amount. 

    However, your plan may not include therapy in this, and you may be responsible for the cost of sessions until that deductible is met. Luckily, certain costs from medical services and mental health services can count towards your deductible.

    3. Your plan may include out-of-pocket costs like copays or coinsurance for certain services. Consult the plan details for those amounts.

    4. You may need prior authorization before a service will be covered. Preauthorization must be done by the insurance company for some services before they will cover them. If you’ve waited a week on prior authorization, you can call your mental health provider’s office to see if the service has been approved.

    5. Depending on your plan, you may need to seek a referral before you can see a mental health provider. Be sure to review your plan details! While certain types of insurance allow you to see an in-network therapist without a referral or diagnosis, some plans require that services be deemed "medically necessary" before they are covered. In these cases, the service must be treating a mental health diagnosis such as generalized anxiety or phobias.

    What’s Covered and What Isn’t

    Exactly what services are covered will depend on your insurance policy, however, there are a few common services that you can expect to be covered partially or in full regardless of what insurance you have:

    • Psychiatric emergency services, which are services for patients who might immediately harm themselves or others if untreated

    • Certain addiction treatments, like rehab and medical detoxes

    • Outpatient care and clinic care like talk therapy, CBT (cognitive behavioral therapy), and psychotherapy

    • Inpatient mental health (when medically necessary)

    • Certain prescription medications

    Wrapping Up

    If you have health insurance, you can reasonably expect therapy and certain other mental health services to be covered. Don’t bank on assumptions, though. Educate yourself on all your options--especially where something as expensive as insurance is concerned. Keep this guide handy as a reference as you look for coverage that meets your needs.

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    Brent Roberts
    Regional Sales Manager at Bennie
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