What’s the deal with mental health providers not taking insurance?

Some do, some don’t… some did. Practices and providers arrive at different solutions that work best for their needs, which may mean deciding to forego insurance paneling after giving it an honest try. We don’t pretend to have all the answers – but we’re all tasked with doing the best we can to weigh options with families’ and providers’ best interest in mind and adapting based on experience.  

A Little Background

What’s the significance of in-network and out-of-network provider status? 

Your insurance plan decides the scope of network coverage, meaning who you can and can’t go to while expecting insurance to pay toward services. When a private practice “panels” with insurance (joins an insurance panel or network), they’ve completed two important steps:  

1. Credentialing and provider enrollment: verification that the providers’ education and training meet the insurance company’s requirements for network participation. 
2. Contracting: negotiation of the participating provider agreement.  

After these two steps are complete, the practice has joined the insurance company’s register of participating, or in-network providers, and can bill insurance directly on behalf of the patient. When you find an in-network provider with your insurance plan, you receive the best chance of services being covered, ideally limiting, or waiving your out-of-pocket costs.  

Some plans will still pay toward services on an out-of-network basis, meaning that, even though a provider may not be in-network, insurance will partially reimburse for services after you’ve paid for the provider up front. This typically entails filing an out-of-network claim containing service, diagnostic and provider information via your insurance portal, and most practices will provide you with a superbill (itemized receipt for insurance) to help this process along. For providers to be able to submit out-of-network claims for patients directly to insurance, each provider must complete the non-participating provider enrollment process for any given insurance company. This requires a lot of legwork, and many practices aren’t equipped to provide this courtesy to patients.   

Not all plans provide out-of-network coverage, meaning you must go to an in-network provider if you want insurance to pitch in. Additionally, not all plans will reimburse for specific services OR diagnoses, whether in-network or out-of-network, despite your benefits summary.  

In a perfect world, mental health providers in private practice would be able to bill insurance directly for services for all families unable to swing the out-of-pocket costs, and insurance would pay in full, leaving patients without financial responsibility. 

Let’s face it, mental health services—whether therapy sessions or psychological evaluations—aren’t cheap. In fact, there tend to be misconceptions around why this is.  

Mental health providers occupy a unique space in our society, wherein we tend to agree on their necessity and impact, while chronically underestimating and undervaluing the work being done. You may have had the experience of brushing off the cost of a chiropractic adjustment, eye exam, or lab work, accepting the going rate for these necessary services and the provider’s experience. *Raises hand.* Is it possible you’ve also gone to schedule with a therapist or psychologist and thought, “Whoa! Why so expensive?” *Keeps hand up.* It’s common that mental health providers are seen as needed, even critically important, while folks are less likely to want to pay the associated out-of-pocket costs for their services. Therapy, for example, tends to be a recurring service that adds up quickly for the patient paying out-of-pocket, and psychological evaluations are involved and costly as well. It’s understandable, then, that these services just might not appeal to one’s finances.  

What is the provider charging for, anyway?  

Valid question, so let’s explore this a bit further. One thing many people may not realize is that a mental health provider charging $x per hour or per session isn’t working 40 hours per week at this rate. In most cases, providers in private practice take in a percentage of their hourly rate as their income, while the remainder goes toward company overhead costs, and ideally, profits for sustaining, improving, and growing the practice. Additionally, providers carry a caseload with a varying number of clients, commonly resulting in around 20-25 billable (or payable) hours per week. Not only is the provider meeting with families back-to-back each hour, but they then must build in time for documentation for each session, extensive report-writing for evaluations, case consultation with peers, professional development, emails, and breaks! 

Chances are that your therapist or psychologist is working exceptionally hard to be optimally present during session while navigating the behind-the-scenes like a magician! Any therapist will be juggling many priorities, and for providers who specialize in a particular area (e.g., children’s mental health), have advanced degrees or extensive experience in the field, their rate speaks to their invaluable experience and expertise.  

The financial impact on the patient may be reduced or eliminated if a provider can contract with your insurance company, but this can come at an unfortunate cost to the provider. To be frank, the world of insurance largely determines the respect the field of mental health receives, by continually reimbursing providers at lower rates than other healthcare practitioners.

Weighing the Pros and Cons of Paneling with Insurance

When a practice panels with an insurance company, each of its providers goes through the enrollment process. Ideally, this would be as simple as submitting an application, et voila! In actuality, the process is more involved and entails much waiting and following up. Each insurance company may have different contracts for varying plans (for example, BCBSNC State Health Plan vs. BBSNC commercial plans) which have separate contract requirements and processes. Not only does contracting and enrollment differ from plan to plan and between insurance companies, but fee schedules (the amount insurance agrees to pay toward any given service) as well as where and how to verify coverage, submit claims information, and access provider support may differ as well. This, ultimately, means a lot of work for small practices to get contracts up and running with insurance companies, let alone navigating and problem-solving issues with patients’ plans and provider participation.  

The “Pros” of a practice paneling with insurance are obvious 

Most notably, it affords many individuals the opportunity to access services they may otherwise be unable to. The “Cons”, in many cases, heavily tip the scale and force practices to face the difficult decision of continuing with insurance or stepping away, leaving insured individuals with yet another difficult decision. The most important factor of all for this profession—being able to meet families’ needs—is then met with the sting of reality: whose needs, and at what cost? 

While not all-inclusive, some of the factors (Cons) of working with insurance may include the following: 

Use of Time & Resources 

1. Small private practice owners and providers aren’t insurance experts, and despite learning a substantial amount about insurance processes, there is always more to know. If you’ve ever tried to understand the ins and outs of your Benefits Handbook, you know you can pour over it for hours and still wind up with more questions than answers! Private practices don’t have any more insight into a patient’s benefits (and often less so!) than the patients themselves, and so researching the benefits of each patient’s insurance plan demands valuable time and resources, which can be costly to a growing practice. It isn’t always an option to have a dedicated staff member for billing and insurance purposes.  
2. Mental health providers and small practice owners need to consider their livelihoods as well as their patients’, which isn’t easy. Does the rate insurance will reimburse for a service provide a sufficient income proportionate to the provider’s time and expertise? In the end, are company finances stretched due to compounded underpayments or is the impact manageable? 

The Waiting Game 

1. Joining an insurance network and the process of enrolling each provider often requires extensive wait times, which may not be clear in advance. The initial process may take 120 days to start, with subsequent “escalation” periods each time a question or status inquiry is resubmitted. This often leads to several recurring 30-day check-ins without substantial movement or updates on the process.  
2. Calls to insurance, especially to resolve recurring issues, are time-consuming and often unproductive; wait times to access Provider Services commonly range 30-60 minutes each, with a cap on the number of claims/issues that can be addressed during any given call.  

Lack of Clarity & Transparency 

1. There is a general lack of transparency and procedure for achieving solutions. While representatives are doing what they can to help based on the access they have to a provider’s contract or a member’s plan, they do not seem properly equipped to address issues that frequently occur. Most often, recommendations are scripted or interpreted based on placeholder information, and the chain of command for escalating issues isn’t established.  
2. It’s common to then be sent in circles, from department to department, seeking a solution, due to unclear process.  
3. Information provided by insurance representatives can be wildly inconsistent from call to call, leading to credentialing or coverage estimate errors, and more wait time to resolve these issues. 

Reimbursement 

1. As previously mentioned, insurance rarely pays the provider’s full rate for services. The rate insurance agrees to pay toward a given service (the allowed amount) is typically a fraction of the provider’s rate to begin with.  
2. Additionally, insurance payments may be inconsistent. This can include services with the same service code being reimbursed differently, or payments not matching the fee schedule assigned by the insurance company saying what they agree to pay the provider for a given service.  
3. Changes that may occur with patients’ insurance card or plan information, especially at the start of a new benefit period, can significantly impact patient coverage and providers’ ability to receive timely payment.  

Coverage and Benefits 

1. Understanding benefits is not straight-forward for patients. Insurance provides a disclaimer such as: “An estimate of coverage is not a guarantee of payment, and final coverage determination will be made at the time claims are processed”. Even if you or the practice contact insurance and screen service codes for coverage, they’ll use a generic diagnostic code to verify coverage, which may change the outcome once services are completed and a diagnosis is assigned.  
2. Insurance can deny service codes or diagnoses that may be critical to quality/comprehensive care, despite a patient otherwise having sufficient insurance benefits. Additionally, insurance will typically not disclose whether a certain potential diagnosis would be covered, and providers face an ethical dilemma of providing this information before an official diagnosis has been made. 
3. Because insurance requires a diagnosis to pay on claims, this can put providers and patients in a difficult position of accepting when a diagnosis may not be needed or appropriate. Without a diagnosis, payment for services becomes the patient’s responsibility. 
4. Patients may not be aware of the challenges involved on the back end of maintaining contracts with insurance, despite everyone’s best intentions. This (understandably) leads to frustration around said wait times, accrued balances due to insurance denials, and lack of clarity around processes and timelines for resolution. 

To summarize, the process of networking and enrolling providers with insurance, navigating patient coverage, and seeking resolution to issues that arise present significant challenges regarding: 

• The practice’s ability to communicate transparently and accurately about insurance issues and solutions; 
• Patients’ peace of mind around coverage and out-of-pocket costs;  

• Potential disruption to service provision and impact on rapport with families.  

These challenges leave patients and providers feeling helpless and disheartened—truly the last thing you need when seeking mental health support for your child or family.  

It’s Not You, It’s Them!

We’ve been trained to view medical insurance as a benefit to you, the patient, while most folks don’t realize that insurance companies work for you! Issues with service coverage, provider approval, claims filing etc. can be a huge setback for many families seeking services, whether using insurance in-network or out-of-network. The practice does what it can to provide necessary and accurate information for insurance to be able to pay toward services and attempts to give voice to the challenges patients are facing. Considering it’s the individual’s responsibility to fully understand the details of their plan and how insurance will or won’t provide coverage, it’s important that you feel a sense of empowerment—maybe even camaraderie—in the process. We know it’s far from simple and straightforward, leaving most confused and frustrated. Accessing affordable healthcare shouldn’t be this way.  

Insurance companies need to receive feedback on the factors that are prohibiting efficient access to quality care.  

We think of insurance companies as these giant entities that can’t be swayed, BUT, there’s power in numbers. *cue inspiring music*  

Are you dissatisfied with your insurance company’s decisions around coverage, or having difficulty navigating or addressing issues? We encourage you to talk to your insurance company and push for alternatives when presented with a limitation of coverage.  

• Try submitting a complaint or an appeal.  
• Request what’s called a “network gap exception” to see if your insurance will consider covering out-of-network services at an in-network rate.  

At the end of the day, it may or may not make a difference for your immediate coverage or access to care. We also know it’s easier said than done, time-consuming and tiring, but we believe every bit of feedback matters.  

Now what?

Our practice is one that’s given the in-network route a dedicated try and come out the other end feeling defeated. When the disappointment sets in that this is where we walk away (at least, for now), we remember that everyone’s experience is different. While not satisfactory, we’re also not alone. 

We’ll continue to hope for an improved future landscape for both patients and mental health providers. In the meantime, we believe choosing to forgo insurance paneling is one way for us to prioritize our patients to the best of our ability at this time. We are so appreciative of your understanding with this decision and look forward to your continued partnership in navigating all the ways we can support your child and your family.