Mental health care providers are often frustrated by the complexities and pitfalls of dealing with insurance reimbursement. Not only is the coding more complex than for many medical conditions, insurance companies may deny payment because of supposed red flags. Not only is this a problem for providers, it’s also a significant contributing factor in access to mental health services.

Why is mental health reimbursement coding so complicated?

Unlike physical health conditions, mental health isn’t as easily treated with standard tests and procedures. The number and frequency of sessions may vary and it can take multiple visits to even determine the diagnosis and establish a treatment plan. [1] Reimbursement codes are also constantly changing which makes it difficult for providers to stay current.

With mental health reimbursement, there are pitfalls that providers need to avoid that are seen as red flags by insurance companies. For example, using the same ICD-10 code for too many patients can trigger an audit. Providers can also trigger red flags when using certain codes (e.g., 99215, 90837 and 90853) too often or without proper documentation. Mental health providers also face issues that wouldn’t be seen as red flags for a physical health provider such as a patient seeing more than one therapist or having two services in one day (i.e., individual therapy session and group therapy). [2]

In addition to the various pitfalls, CPT codes need to be interpreted. The definitions aren’t always clear and the interpretation varies from payer to payer. So if a mental health care provider is dealing with multiple insurance companies, this adds yet another layer of complexity to billing.

Why does the complexity of mental health reimbursement matter?

Bottom line is everybody needs to earn a living wage. And for a mental health care provider, much of the time spent during the day (i.e., session notes, developing a treatment plan, etc.) can’t be billed which means that time is all overhead. So the more overhead costs you have, whether that’s time or money, the less you earn. “Most insurance companies pay therapists in their networks between $60 and $80 per session. In the San Francisco area and Los Angeles, therapists say the market rate for therapy is more like $150 to $200 a session.” [3]

Having to tiptoe through the complexities of reimbursement, deal with frequent denials and potential audits, places an undue burden on mental health care providers. And anything that takes time away from seeing patients is not only frustrating from a professional standpoint (after all, therapists go into their field to help people, not deal with mountains of paperwork!), it makes it that much more difficult from a financial perspective for providers to continue accepting insurance for services. This is particularly challenging for individual therapists or those in smaller practices who don’t have administrative teams to deal with these issues.

And so for a provider faced with less time to treat patients, the frustrations of dealing with insurance companies and significantly less income, this can lead many to choose private pay rather than accepting insurance. So when we talk about issues of access to mental health care, especially in non-rural areas, it’s clear that the complexity of mental health care reimbursement is a significant contributor to this issue.


[1] https://talismansolutions.com/why-is-mental-health-billing-so-complicated/

[2] https://medwave.io/2020/10/what-makes-mental-health-billing-so-difficult/

[3] https://www.npr.org/sections/health-shots/2016/07/14/481762357/frustrated-you-can-t-find-a-therapist-they-re-frustrated-too

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