People often lean towards using their insurance to cover treatment because it makes treatment more affordable. And with increased affordability, you might be able to meet more frequently and feel better faster. But there are reasons to consider NOT using your health insurance for mental health treatment.  Nevertheless, this might not be the most beneficial option. Below are some reasons you might reconsider using your health insurance for mental health treatment:

1. Privacy Concerns

Engaging the insurance company may compromise your privacy. When your insurance carrier pays for services, they retain the right to review your treatment records which include your reason for seeking treatment and diagnosis (see below).  Sometimes a therapist can provide a Treatment Summary in leu of your full treatment record, but ultimately your insurance company can request to review your entire record. If you decline to provide those records to them, your therapist may be required to return payment to the insurance company which could mean you’re on the hook for the cost of treatment—retroactively.

• Note: if you’re not concerned about privacy (many people aren’t when it comes to medical care), then you can cross this off of the list and move on.

2. Diagnosis Requirement by Insurance

Insurance providers mandate a diagnosis before covering your treatment, similar to presenting paperwork for a broken arm to justify surgery. Mental health treatment also requires a diagnosis. First of all, being given a diagnosis is not an end-all-be-all thing. Even if you have been “given” a diagnosis by a psychologist or therapist, it doesn’t necessarily mean it is accurate or even the best descriptor for your experiences. Diagnoses are essentially names that were developed to distinguish one cluster of symptoms from another. But there’s a lot of cross over between diagnoses and the process of determining diagnosis can be murky—after all, it involves two people trying to come to a shared understanding in a short amount of time. Then we have to consider the fact that some diagnosis come with a heavy stigma attached to them. Some examples are bipolar disorder, substance use dependence, suicidal ideation, borderline personality disorder and even OCD and ADHD.  People who carry these diagnoses often experience discrimination, for example, being denied life insurance. And once that diagnosis is on your record, it never goes away. This is one reason a person might opt for private payment, even if they have insurance.  By opting for private pay, you can request that your therapist NOT list a diagnosis in your medical record as long as you don’t plan to seek reimbursement from your insurance plan.

• Note: if you’re not concerned about privacy (many people aren’t when it comes to medical care), then you can cross this off of the list and move on.

3. The Requirement of Medical Necessity:

Not only does insurance require a diagnosis, they also require that a person’s symptoms meet something called “medical necessity.” This means that insurance covers treatment only for symptoms of a certain severity, raising concerns about who gets access to treatment. The issue lies in insurance’s limited coverage of ongoing preventative care, as it primarily operates on a profit-driven model that focuses on treating diseases. For those seeking therapy to improve their lives, manage stress, cope with grief, or engage in couples counseling, meeting the strict “medical necessity” criteria can be challenging.

• Note: if your symptoms are very severe and impacting you in several areas of your life, you likely won’t have trouble getting your treatment covered. In this case, you may cross this off of the list and move on.

4. Inclusion in Permanent Records

Once you undergo treatment and insurance agrees to cover it, all related information becomes part of your permanent medical records. These records can be accessed by other insurers and potential employers, potentially labeling your mental health issues as preexisting conditions.  Parents might consider the long-term impact of having diagnoses on their child’s health record, especially if those fall into stigmatized categories of mental health.

• Note: sometimes getting effective treatment takes precedence over avoiding stigma or labels. There is no one right or wrong way to handle this. You might not care about these things and that is also totally ok.

5. Treatment Influenced by Insurance Companies

Insurance companies reserve the right to monitor your progress and decide when your treatment should cease, irrespective of your therapist’s recommendations.

 

6. Impacts of Insurance Changes

Switching jobs or insurance providers may necessitate starting treatment afresh, as new insurers might not approve the ongoing treatment, leaving you in the lurch.

• Note: when this happens, some opt to continue with their current therapist and pay for treatment out of pocket. This may be a great option for you if you’ve developed a strong relationship with your therapist. FindWell Counseling offers negotiated fees to individuals experiencing financial hardship. Please reach out if you believe that therapy is not affordable to you due to financial limitations.

7. Limited Coverage for Episodic Sessions

Insurance might not cover sporadic sessions aimed at addressing specific events or triggers if they do not significantly impact your daily life.

8. Possibility of Withdrawn Approval

Even with initial approval, insurance companies can retract their support, leaving you responsible for significant costs.