What You Should Know
About Using Health Insurance
for Psychotherapy or Psychological Consultations
For the past two decades most people have partly funded
psychotherapy with health insurance. That arrangement worked reasonably
well at first. Now, however, the system is changing. As a result, using
your health insurance for psychotherapy may lead to new problems and
highlight some longstanding ones. Before you make a decision about whether
to use your health insurance for psychotherapy, please consider both sides
of this complicated issue.
Benefits of
Using Health Insurance
The primary benefit is clear. You paid premiums for your health insurance,
either directly or indirectly through your employer. It was an investment.
One return on that investment is reimbursement for part of your therapy
bill.
Complications
of Using Health Insurance
Problems come in three areas:
Loss of
confidentiality,
loss of control of treatment, and the effects of having a psychiatric
diagnosis.
Increasing
Loss of Confidentiality
In the past, therapists only needed to provide insurance companies with a
diagnostic code, identifying information, and dates of service. Now,
however, insurers usually want a thorough description of your problems,
history, symptoms, family life, work life, etc.
This information may be reviewed by employees of both the insurance
company and a separate managed care company. Many employees of these
companies do not have the same training in confidentiality as
professionals. Unfortunately, there have been increasing reports of
disturbing breaches of privacy. Therapists have no control over
confidentiality procedures once the information leaves our offices.
Insurance and managed care companies put your information into their
computers. Managed care company ownership has been changing rapidly.
Smaller companies are bought out by bigger ones, which are swallowed by
even bigger companies. Many therapists are concerned about what will
happen to client information as changes in ownership take place.
Decreases in privacy may lead to decreases in your openness with a
therapist. That will make your therapy less effective.
Loss of
Control of Treatment
Managed care companies use the information they require therapists to
provide to decide if treatment is medically necessary in the first
place, and, later, if treatment should continue. Many who make the
decisions as to the medical necessity of psychotherapy have limited
training in psychology or psychotherapy.
The
criteria managed care companies use to decide whether psychotherapy is
warranted may be quite different from the criteria you and your therapist
use. Managed care companies make money by reducing the amount of treatment
provided to patients or clients. (Many therapists think of the people they
work with as "clients" rather than "patients," in order to emphasize
health rather than illness.) Therapists worry that such economic goals may
color decisions to authorize or refuse to authorize psychotherapy.
The
managed care staff who review requests for treatment have formulas they
must follow in making decisions. Some formulas are economic. Others are
based on "average" cases. However, formulas and averages cannot account
for human individuality. Therapy done by formulas cannot provide the
careful listening that years of scientific research have shown is the
cornerstone of effective therapy. Yet therapists who belong to some
managed care panels are pressured to follow formulas or be ejected from
those panels.
The
two people who can best make treatment decisions are the client and
therapist, in partnership. It used to work that way. Today, if you use
your health insurance to partially fund your therapy, it may not.
Control over treatment is also lost because some kinds of services and
problems are not covered. For example, marital counseling is usually not
covered by health insurance even though its effectiveness is well known.
Therapy for long-term personality problems is almost never covered by
managed care.
Managed care companies usually agree to cover treatment only to the extent
that it focuses on symptoms. (That's one reason they may encourage the use
of psychiatric medication rather than psychotherapy.) They usually refuse
to cover treatment aimed at the underlying problems that cause symptoms.
Managed care is a system that works best in dealing with crises. However,
if people do not come to terms with the underlying issues, new crises are
likely.
The Effects of
Having a Psychiatric Diagnosis
Health insurance benefits can only be used for the treatment of illness.
That means your therapist must make a psychiatric diagnosis about you
before the benefits will be available. A psychiatric diagnosis labels you
as having a mental illness. The American Psychiatric Association has
published a lengthy book (The Diagnostic and Statistical Manual of
Mental Disorders, now in its fourth edition) detailing criteria for
many different mental illnesses, some relatively mild and temporary,
others more severe.
Therapists are increasingly seeing diagnoses come back to haunt people.
Many people have found that using health insurance benefits for
psychotherapy has actually cost them money because their premiums went up
after making a claim. (That's in spite of overwhelming scientific evidence
that therapy improves general health and reduces total medical bills.)
Life and disability insurance applications have been held up. Employers
are sometimes notified about all medical care visits, including
psychotherapy, by the insurance company.
The
very existence of psychiatric diagnoses is only one way of looking at
human problems. Its biggest advantage is that it helps get health
insurance benefits, an advantage that is waning. Psychiatric diagnoses
usually do not describe issues in ways that help people actually solve
problems. In fact, diagnoses often get in the way. Other ways of looking
at human problems are more helpful.
Choosing not to use health insurance benefits means you do not have to
have a psychiatric diagnosis. That means as people make decisions about
you in the future, such a diagnosis will not be an issue.
What Costs Can I Expect?
It's impossible to know at the beginning of psychotherapy how many
sessions or what kind of sessions will be most helpful. After a careful
assessment of your situation and your goals, your therapist may make an
educated estimate. Such estimates are subject to change as you and your
therapist gain more information about your situation or as your treatment
goals change. It may be helpful to know, however, that 90% of outpatient
psychotherapy lasts less than 25 visits. Yours may last longer; you and
your therapist will be in a better position to judge that after several
sessions.
It
may also help you to know that many research studies show that many people
benefit financially as a result of completing a successful course of
outpatient psychotherapy. These gains may come a variety of ways:
(A)
There is a strong connection between mental and physical well-being.
Emotional distress uses up our physical resources. For the short term,
that's no problem. Long-term distress, though, makes the body vulnerable
to a wide range of problems because its resources are depleted.
(B)
For similar reasons, people who already suffer physical illnesses heal
more quickly, and for fewer dollars, when needed psychotherapy is included
in their treatment.
(C)
Emotional distress often interferes with productivity on the job. People
cannot do their best when they're anxious or upset. Again, for the short
term this is not usually a problem. Long-term distress, though, often
creates work problems and decreases in income. Studies show that people's
earnings often go up after effective psychotherapy.
(D)
Marital therapy that preserves a marriage lets husbands and wives avoid
high legal fees and other expenses of divorce. Therapy that helps those
people who do divorce also lowers the high legal fees associated
with ongoing post-divorce bitterness.
(E)
Therapy with children and adolescents often leads to higher self-esteem
and better academic performance. Both are associated with higher adult
income.
It
may be useful to think of psychotherapy as an investment rather than a
cost. People do expect to pay most professional fees, such as lawyers,
dentists, and CPAs, out-of-pocket. Because of the growing problems with
third-party (insurance) reimbursement, many therapists expect that most
psychotherapy in the future will also be paid out-of-pocket.
(Note: The text above was adapted from a brochure prepared and distributed
by a Colorado psychologist and is reprinted here with permission.)
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