Interested in therapy but unsure whether you can afford it? Here is a step-by-step guide to help you figure out insurance reimbursement:
1. Call your insurance company and ask about your coverage:
You will need to call your insurer, and ask specifically for “mental health” services (usually handled by a different department than medical claims, and sometimes by a different company).
When you call your insurer, they’ll let you know what your policy covers in general terms — for example, 80% of the “customary and reasonable” fee (this might also be called “usual, customary, and reasonable," or UCR).
So, for example, if your insurer only considers $150 to be the UCR for individual psychotherapy, they’ll pay 80% of that, or $120 (After you’ve met your deductible, that is).
2. Get your insurer to tell you how they calculate your reimbursement:
Unfortunately, insurance companies usually won’t divulge what they consider to be usual, customary, and reasonable. Often times, they will say that it is “proprietary information" (soooooo frustrating......)
What you can do to try and work around this is to tell them the fee that the provider charges for a particular service, in a particular geographic area — and to be educated about the customary fees in your area.
So if you call to ask about reimbursement for my services, you would tell them the following:
• You’ll be submitting claims for “Individual Psychotherapy, Outpatient-45 minutes,” also referred to as CPT code 90834.
• My current fee for CPT code 90834 is $235.
• My Zip code is 94025 (reimbursement varies based on location).
• I am a licensed psychologist and I am a non-participating provider (meaning that I have chosen not to have a “contract” with any insurance companies).
Then ask them if my fee is above their UCR (which it will likely be) and what they’re willing to pay for that service. When you ask them, if they say anything, they’ll typically only say “yes” or “no” — so you won’t know if the fee is only $10 more, or $100 more than what they claim is reasonable and customary.
3. Know the rules of the “game” and be an informed consumer:
Unlike most aspects of health insurance, there are very few regulations for insurance companies when determining what they consider reasonable or customary. In fact, only a few states even define what constitutes the terms “reasonable, usual and customary” and even fewer have regulations on the methodology used in determining these charges.
There have been some changes (after many class action lawsuits, and work on healthcare laws). You can go to a consumer rights site and see what an objective source says the customary rates are in a particular geographic area (as therapy costs more in Silicon Valley than in, say, Kansas).
The site is Fair Health Consumer. Type in “94025” for the zip code, and “90834” for the CPT code (that’s the code for individual outpatient psychotherapy, 45 minutes).
Most of the time, insurance companies use the 80th percentile as the basis for the UCR.
4. Ask your psychotherapist for help and guidance
All psychotherapists are aware that insurance companies prefer to skew the “game” to their advantage, not to patients. Therapists should also be able to help if insurance companies aren’t playing fair, and guide you about the ins and outs of getting the reimbursement you’re due.
Like many healthcare providers, my patients pay me my fee directly, and then file for reimbursement. I provide a statement at the end of each month that includes all of the information you’ll need to file a claim, and you send it to your insurer along with one of their claim forms.