Why Wouldn’t A Therapist Accept Insurance?

I wrote a while back about insurance and therapy, and apparently I intended to make the topic a series and then promptly forgot about it. Hey, it happens. I’ve got a lot on my mind.

Anyway, a frequent hot button issue among therapists in the United States is the question of whether or not to even accept health insurance. Personally, very few of my clients are self-pay, but I completely understand a therapist not accepting health insurance. Many people get confused about this, so I thought I would share some reasons I know of why therapists would operate as completely self-pay.

Like I said, this is a hot button issue, and I feel passionately about it. That will come through in my writing today, so please understand that it is because I care so much for the people I work with that I feel this strongly.

So, why would a therapist not accept insurance?

1. An insurance company might refuse to panel them. This is NOT a reflection on the therapist’s skill or credentials! One insurance company refused to panel me because they felt they had already paneled enough providers. (Then why do your clients keep calling me because no one else can fit them in?)
   One solution: Call your insurance company. Tell them they do not have enough providers to meet the need. Ask them to credential more therapists.
   
2. Insurances pay a “negotiated rate” that is not always sustainable. When a therapist panels with an insurance company, we tell them our rate, and the insurance company counters with how much they will actually pay us. Isn’t that fun? You might feel that you have “excellent” insurance, and your provider is getting paid 1/3 of their actual rate. We need to keep the lights on, and that is not always possible with the going rates in the area.
   One solution: Call your congress people. Lobby for laws that require insurance companies to reimburse at a sustainable rate. They can afford it – I have seen the CEO salaries.
   
3. It is often difficult for therapists to challenge the “negotiated rate” as a group. Most insurance companies require paneled providers to sign an agreement that we will not tell anyone our negotiated rate. This makes it impossible for us as a group to lobby for changes.
   One solution: Call your congress people again. Lobby for laws that allow us to tell each other about our reimbursement rates.
   
4. Billing is a nightmare. Did you know that insurance companies can agree to pay for a service, and then after the service is provided, refuse to pay? Did you know they can pay for a service but then up to five years later demand the money back? It happens more than you think. If an insurance company called today and demanded I repay them for sessions conducted in October 2016, our office would have to return the money. Then we would have to either eat that cost or send the client a surprise bill. That is just one example – prior authorizations, session caps, and arbitrary denials happen all the time. Many therapists do not have the time, energy, or staffing to argue about payment with insurance companies. We do not get reimbursed for that time, and it takes our energy away from caring for you, our client.
   One solution: Yes, I am going to tell you to call your congress people again. Laws need to change to hold insurance companies responsible.
   
5. Insurance requires a diagnosis. I frequently say there is no minimum requirement to ask for help. But if you are using insurance to pay for therapy services, you must have a diagnosable condition or they will not cover your appointments.
   One solution: Lobby for system changes and laws that get rid of this requirement.
   
6. Your insurance will see parts of your medical history. Typically, insurance will only see certain components of your appointment, such as the billing code and diagnosis. That is already a deeply personal piece of your medical information being shared with outside eyes. But insurance companies are also allowed to audit your therapist, meaning they can request further information to make sure that the visits are “medically necessary” and essentially can demand to see all your notes, history, assessments, et cetera. With private pay, that information stays with you and your therapist.
   One solution: Again, we need system-wide changes to protect your privacy in these instances. Call your congress people.
   
7. Your insurance gets to decide what is “medically necessary” and permissible. I was doing telehealth before COVID-19, and we constantly ran into insurance companies saying it was not “necessary” to offer this service. So people who had to drive up to three hours each way to get to my office had to either make the trip, or pay out of pocket. This is just one example of how insurance can interfere with your treatment options. Remove them from the equation, and the decision about what is best for your care lies with you and your therapist rather than the insurance company.
   One solution: Many states have started mandating that telehealth be reimbursed, but we need this change on the federal level to guarantee coverage for everyone.

As you can see – there are several good reasons why a therapist would choose not to accept insurance, both for their own survival and for your privacy. We are struggling to navigate the system as it is, and we need your support to make these changes.