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Using health insurance to cover counseling.

Updated: Apr 26

Many people feel that therapy is an expense that they cannot manage without using their insurance. Before making the decision to use your health insurance, I encourage you to investigate all options and arrive at an informed decision regarding your health care. That may mean using your insurance, and it may mean making another choice. You can always decide to use your benefits, but you cannot “undo” many of the negative consequences of using them. Combined with the confusion, I see the following risks of using your health insurance for mental health treatment.


The required diagnosis of a mental illness

Insurance companies only pay for things that are “medically necessary.” This means that someone has to actually diagnose you with a mental health disorder AND prove that it is impacting your health on a day-to-day basis. Many of life’s problems are not mental health disorders. Many folks seek treatment before their issue would meet criteria for diagnosis as a mental health disorder, which is a good thing. Additionally, insurance companies require treatment plans, progress reports, and many other types of personal information to determine what, if anything, they will cover.


Understanding What a Diagnosis Means

If you are diagnosed with something, you should be able to decide who gets access to that info and why. You lose control of that information when it is in your file being faxed to anyone in the health care industry who requires access to it. A diagnositic code on an insurance form says nothing about how you cope, what your strengths are, and which of the many symptoms you actually have. But a diagnosis will speak for you and may negatively impact your eligibility for things.


Children have a more difficult time in many ways when they are given a diagnosis. This diagnosis can follow them around in school, on to college, and be a barrier to doing certain things such as working with the military, landing federal jobs, security clearances, aviation, and any other jobs requiring health-care related checks (many schools and healthcare institutions are now instigating these policies to screen out employees who may be unstable or cost too much money in mental health care and lost work days). If your child’s condition warrants a diagnosis, you may want to have some say over how that diagnosis functions in their life.


The details about your treatment are open and available to anyone with access. This could include potential employers. The average insurance claim passes through 14 people while it is being processed. Simply stated, Loss of Confidentiality equals Loss of Control.


Limits on Treatment

Insurance companies want to pay as little as possible for your care. Therefore, the number of times you can see a therapist or counselor is artificially limited (typically 3-6 sessions). Additionally, insurance companies will only pay for "go forward" treatment to resolve the present issue at this point in time. What this means is that an insurance company will not pay for sessions spent determining why you are experiencing the issue. In mental health, the cause of the current concern is often related to something you experienced in life; trauma is one example. Proper treatment requires that the source of the concern is identified so that the issue can be addressed at the root.



If you are interested in exploring your counseling options, I offer FREE confidential 30 minute consultations. To schedule an appointment, please call our office at 321.616.7225, send us an email, or a Facebook message.

#mentalhealth #mentalillness

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©2020 by Michael Moore, MSW.