It may be confusing to figure out how the insurance system works for covering family counseling when you have a lot of stress at home. Today, you are trying to find out whether your family’s mental health needs can be met with the proper insurance coverage you carry.
Here’s the quick answer, many health insurance policies do provide family therapy benefits.
Your health insurance company, type of health insurance plan, in-network therapy provider can impact whether you will receive the necessary benefits under your health insurance policy for family therapy.
You can navigate through the confusion of insurance and family therapy coverage by learning how each insurance company’s policy works with the family member and family therapy, so that you do not receive unexpected costs and easily have access to the family support services they need. Some family therapy plans pay the full cost of therapy services when a mental health condition is diagnosed; there may be limitations, referrals, and/or no preauthorization required for some, depending on the individual insurance company’s policies.
Most families are concerned about how much they will be charged for family therapy services before starting therapy services. This is one of the common family questions before starting therapy services for families. Odyssey Counseling provides families in the Albuquerque area with both virtual and face-to-face family therapy options.
What Are the Factors Used to Determine Family Therapy is Covered by Insurance?
There are many different factors that your insurance company uses in determining whether or not your family's health insurance policy covers family therapy services.
Medical Necessity Requirements
Most insurance companies require that therapy be medically necessary to qualify for insurance payment. Medical necessity may mean one family member must be diagnosed with a mental health condition like anxiety, depression, etc., to receive insurance benefits for therapy. Insurance companies may require documentation from the provider as to why therapy is necessary for the family. Because most insurance companies provide preauthorization before therapy treatment is started, it is always a good idea to check with your provider to see if preauthorization is required before starting therapy.
Identified Patient Criteria
Most insurance companies require a family member to be the identified patient for family therapy, meaning that the therapy benefits are only available to the family member who is the identified patient. Although family therapy is generally received by all family members, only one family member is considered the patient.
Licensure and Credentialing of Providers
Most insurance companies pay for therapy services provided by licensed mental health professionals. The following license types would be expected to be approved for therapy reimbursement from insurance providers:
- LPCs (Licensed Professional Counselors)
- LCSWs (Licensed Clinical Social Workers)
- Psychologists
- LMFTs (Licensed Marriage & Family Therapists)
Your out-of-pocket costs are generally lower if you utilize network providers. Odyssey Counseling provides therapy services that meet several of the insurance coverage requirements.
Insurance Plan Types and the Impact on Coverage
Insurance companies provide coverage for family therapy differently based on the type of health insurance plan you have.
Private Insurance Policies
Private insurance companies vary in how they provide benefits for family therapy services. Some private insurance company have limited benefits whereas others may provide generous family therapy benefits. Most of the time, private insurance carriers will only reimburse family therapy services if a mental health diagnosis is on the record prior to the family member receiving family therapy services. Many private insurance companies may reimburse for virtual family therapy.
Review your private insurance policy for your deductible, copays, and maximum number of visits for family therapy.
Employer Group Health Plans
Most employer group health plans offer some mental health treatment benefits. Many employer plans are required by the Mental Health Parity and Addiction Equity Act to provide mental health benefits that are at least comparable to the medical benefits provided by the employer’s health plan.
Employer group health plans can:
- Lower copays for therapy
- Maximum number of visits per year
- Require in-network therapist
The details of how many visits are covered by the employer and provider.
ACA Marketplace Plans
Marketplace plans generally include mental health treatment services as a part of the essential health benefits, as defined by the Affordable Care Act (ACA). This means that a family may receive family therapy as a mental health service under the insurance policy that the family members purchase from the ACA Marketplace.
However, families receiving insurance through ACA may have out-of-pockets limits, coinsurance, or copays to be paid by the family before the insurance company begins to reimburse the family for family therapy services. A family may qualify for subsidies to receive their family health insurance and to help reduce the costs of benefits.
Medicaid and Public Insurance
The Medicaid program often covers mental health services, including family therapy. Depending on the state of the Medicaid program, there can be a lot of rules and regulations governing the payment of family therapy services.
The following terms as they apply to managing the cost of therapy using health insurance:
- Deductible
- A deductible is the amount an insured person must pay out-of-pocket before the plan benefits begin to reimburse for therapy professional services.
- For instance, if you have a deductible of $1,500, you must pay $1,500 in out-of-pocket costs before you receive any of your plan benefits.
- An out-of-pocket maximum is the most an insured family member will pay during the calendar year before the insurance company will pay 100% of the insured's eligible professional services.
- Copay
- A copay is a fixed dollar amount that insured members pay for therapy services.
- For example, you receive an invoice/statement from your therapy provider stating the fee for the therapy session was $80.00. If your copay is $20.00 for therapy services, then on the statement you pay $20.00 to your therapist and the insurance company pays the remaining $60.00 for your therapy session. The process may also be referred to as cost-sharing.
- Coinsurance
- In some cases, insurance carriers may require that the insured family member pay some percentage of the balance due (or the therapist's billed amount) after the plan pays its percentage of the billed amount. Then after making this payment (or coinsurance) the family member is responsible for the unpaid balance.
- Example: If your therapy session costs $100.00 and your coinsurance is 20%, your co-insurance would be $20.00 and the insurance company would pay the remaining $80.00 for that visit. Thus, you would pay $20.00 in coinsurance and the balance of $0.00 (the remaining balance) would be picked up by the plan.
Co-pays, Deductibles, and Coinsurance
Since the rules and regulations governing health insurance are complex, it is best to confirm your insurance benefits regarding family therapy with your insurance carrier before obtaining therapy.
You’re likely to have a $25 co-pay per visit, and, regardless of what your co-pay is, if you have a coinsurance arrangement in the plan, that will determine how much of the therapy bill the insurance company will pay and how much of the bill you will pay after you have satisfied your deductible.
For example, if your coinsurance is 20%, you will pay 20% of the total cost of the therapy session and the insurance company will pay the remaining 80%.
In-Network vs. Out-of-Network Providers
Providers who are in-network with your insurance plan have networks that have agreements with specific insurance companies and have negotiated to lower your therapy bill with the provider based on the relationship that the provider has with your insurance company.
If the provider is out-of-network you will have some assistance from your insurance company, but your out-of-pocket cost will be much higher. Prior to making a session arrangement with your therapist, you should verify the relationship of the provider to the insurance company.
The Mental Health Parity Act
There are several legal and regulatory statutes that ensure that you have access to your mental health treatment.
The Mental Health Parity and Addiction Equity Act of 2008 requires that insurance companies treat mental health benefits similarly to physical health benefits. If your insurance company has a physical health benefit that limits the number of therapy sessions that you may have access to, it must apply that same limitation to your mental health benefit.
Several states have enacted their own parity laws extending mental health parity coverage. Your state may require the insurance company to provide mental health treatment specifically for specified types of treatment as well as general coverage. To additional information regarding the applicability of these laws to your specific case, please check with your state for relevant laws.
How to Verify Your Benefits
To be benefitted by your insurance, you should verify your benefits with your insurance company prior to initiating counseling.
When you contact your insurance company, ask the customer service division of the company the following questions:
- Is family counseling covered under my plan?
- Will I need a diagnosis in order to be covered for family counseling?
- Is pre-authorization for family counseling required?
- Are virtual counseling sessions covered under my plan?
- What are my co-pay or deductible amounts?
- Is my provider in your network?
Taking notes during the conversations is helpful and can limit your confusion at the time of your appointments.
Pre-Authorization and Appeals
Understand your insurance company's pre-authorization guidelines. Some insurance policy holders must receive approval before starting therapy sessions. This may include submitting your referral to the insurance company, as well as submitting your treatment plan and relevant medical documentation. If you have questions regarding the pre-authorization process, your therapist may help you with this.
If your company denies coverage for services, this decision may be appealed by the policyholder. Once you receive the denials letter, review the letter carefully, collect documentation to support your appeal, as well as the providers professional recommendation as well as the providers professional recommendation as well as any relevant mental health evaluation. A well-documented appeal my reverse the denial decision.
Alternative Options for Affordable Care
Even if you have limited insurance options for counseling or therapy, there are many alternate ways to access mental health support.
There are numerous low-cost community mental health centers available that provide mental health services on a sliding fee scale based on your income/ability to pay. Many of these service providers offer family therapy, parent support, and mental health transitional support such as anxiety, depression, and life transition.
There are also groups that can help connect family members with one another experiencing similar issues that they are facing. Connecting with other families in peer support groups can offer emotional support, coping skills, and provide a sense of community. Many organizations have support groups for parents, relationship support, grief support, and stress management support.
Many providers offer "sliding scale" payment options or payment plans, to reduce your Out of Pocket costs. If you are on a limited budget, please consult with your provider to see if you can access a reduced-fee option.
In the past few years, there has been a shift in the counseling and therapy industry toward online and virtual therapy options. Virtual and online therapy provide flexibility and access/availability of providing services to families in their own environment and in their own time frame. For example, in the Albuquerque area, Odyssey Counseling has both virtual and in-person family therapy for families.
Family Counseling Insurance FAQ
Will insurance pay for family therapy?
Most insurance policies will cover family therapy as long as medical necessity and a mental health diagnosis are met.
Will Medicaid cover family therapy?
In many states, Medicaid will cover family therapy, and family therapy will vary from state to state and based on the type of plan you have.
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