Information about Health Insurance Coverage for Psychological Services.

What About Insurance?

Most people have health insurance coverage, usually through programs offered by their employers.  Self employed individuals can usually obtain group rate coverage through their Chamber of Commerce, or other professional association.  Coverage is also available through special programs offered by health care companies directly, although these are usually more expensive, or have a higher deductible and/or copay requirement.  Starting this year, health care reforms have resulted in a clearinghouse for Massachusetts residents that are looking for coverage.  The Mass. Health Connector ( is the website to start with.  This includes policy descriptions and prices from different companies, through registration and purchase of a policy (now including dental), to payments.

Estimates indicate, however, that over 4 million people in the United States do not have coverage for health services.  Many of these are unfortunately children or adolescents, since family coverage is more expensive than coverage for an individual.  Low income workers may not be able to afford family coverage.  Employers may require workers to pay a higher proportion of their family coverage.  Fortunately, there are programs available to obtain health coverage for children and adolescents, even if their parents are not covered.  Every state has a Children's Insurance Trust, supported by federal money, which makes coverage available at low or no cost to children and adolescents, based on parental income.  Every state also administers a Medicaid program, which can make coverage available at little or no cost to parents for their children.

In Massachusetts, everyone (with a few exeptions) is required to have health insurance.  A state tax penalty is levied for those who do not comply.  Starting this year, a federal penalty will also be levied for those who do not comply.  The state has worked with private health care companies to arrange coverage programs that are affordable to individuals and families.  The Commonwealth Connector offers a choice in vendors, deductibles and copay fees.  That's good news for Massachusetts residents.

Do I Have Insurance Coverage for Mental Health Benefits?

Almost all health insurance contracts include coverage for mental health problems (unless specifically excluded by the purchaser to reduce costs).  Contacting the company that issues your policy for details is the best way to find out what your coverage is, and how to utilize it.  On-line websites are offered by many companies to allow subscribers to obtain coverage details and provider resources.  Many health care companies require use of providers on a network of approved professionals or agencies.  This is an attempt to both assure the quality of services offered to their members, and to control the costs of services.  Some health care policies do not restrict the choice of their subscribers, as is the case with indemnity plans.  In many cases with managed health insurers, referrals are required to see a provider or specialist other than your Primary Care Physician. (PCP)  These referrals are usually easy to obtain, often from the PCP or directly from the insurance company.  Sometimes the specialist can request the referral or prior approval.

Almost all contracts require a copay fee, which is a payment that the subscriber is responsible for paying each session.  Most providers appreciate payment of this fee at the time of service, although billing plans can be arranged at the first meeting.  For plans with a deductible, subscribers are responsible for paying for services until their deductible is satisfied.  Many people have supplemental coverage to pay deductibles and copay fees.  Many employers also offer flex spending plans which can cover these costs as "pre-tax dollars".

How Does Insurance Work?

Most mental health providers will bill insurance companies for services directly.  Some do not, and will supply an itemized bill.  The subscriber is responsible for submitting the bill to their health coverage company to be reimbursed for their payment to their provider.  Fees vary widely, from type of provider, to type of service, to the geographical area where services are provided.  Be sure to discuss these issues with your provider, even as you select who to utilize for your child or adolescent.

What Information Goes to the Insurance Company?

A diagnosis is required by health coverage companies for coverage of mental health services.  This information is protected as confidential by federal law (the Health Insurance Portability and Accountability Act, or HIPAA) as Protected Health Information (PHI).  Release of this information is not allowed, except under specific conditions, which should be explained to you on your first session.  Providers are required to give you a written explanation of this law, and ask you to sign a form that they have done so.  At this point the amount of information required for a claim, and collected by the health coverage company, is minimal.  However, managed health companies collect a great deal of confidential information, and subscribers should be aware of what is required.  Medical necessity for services is another requirement for coverage of services.  Most companies also require you to utilize a licensed professional, and then only for approved types of services.

Benefits can often be limited by contract, either with the employer or with the subscriber.  Fortunately, for many mental health diagnoses, services for children are much less limited.  This is due to state and federal legislation.  Coverage is often not the same for mental health as it is for other general medical conditions, but state and federal legislation is also in place to correct this (Parity laws).  This means that benefits for mental health must be administered the same as all other medical disorders identified by the American Medical Association, the American Psychological Association, and/or the International Code of Diagnoses (ICD-9).  Any deductibles, copayments, or limits must be the same.  No longer can mental health benefits be limited to a certain number.  Of course, medical necessity still applies, and the provider often has to establish this with the company.

Final regulations regarding the Mental Health Parity and Addiction Equity Act (MHPAEA) became effective July 1, 2014, and apply to all commercial plans, administrative service contracts, and fully insured plans - including grandfathered and non-grandfathered plans.

What is the Privacy of My Information with My Insurance Company?

Federal laws (HIPAA), as well as state laws, protect the privacy of your health information, called Protected Health Information (PHI).

Your insurance company has a statement about privacy, confidentiality of information, compliance with HIPAA, and many other items.

What is the Privacy of My Information with My Provider?

Your licensed provider also has a statement about their privacy, confidentiality of information, and compliance with HIPAA which they follow.  You will be given a copy of this statement at your first session.  You will also be asked to sign that you have received this statement.  Your next session, you will be asked whether you have any question about the statement, and again asked to sign that you have no questions.  Parents must sign for their children or adolescents.

Eventually, all of our health information (PHI) will be kept in a national electronic database.  This is being developed, but is not yet functioning.  The database, connected to electronic records, will initially appear in hospitals and large medical settings.

This is a good idea, so that if you are ever injured away from home, the medical personnel will be able to know of any allergies, diseases, medications, or other important conditions required for treatment decisions.

This is a risky idea since the safety of electronic databases is in question.  Financial and other electronic databases have been hacked, and information has been stolen.

The statement you were given explains how your provider will attempt to protect your PHI.  This includes requiring your informed consent and signature to share any information, and what is to be shared to whom.  This also includes protection of electronic data, such as backups, emergency contingencies, encryption, and others.

Hopefully, this page has answered many of your questions about health insurance coverage for psychological issues.  Feel free to ask questions by using the Contact Us form.  You can also contact your insurance company directly with questions.  Most companies have a customer service phone access number on their subscriber identification cards (some with direct access to mental health case managers).  If you live in southeast Massachusetts, in Norfolk or Plymouth county, Cranberry Counseling, P.C. in Weymouth would be more than happy to answer your questions and to make an appointment to help diagnose and start a treatment plan for your child or adolescent and your family.  See the Cranberry Counseling, P.C. page of this web site for more information, or use the Contact Us form.