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How to bill insurance for therapy

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If you accept health insurance, you’ll likely have the opportunity to help more people, and to build a thriving business in the process.

Helpful as it can be to mental health, not everyone can afford to pay for therapy sessions out of pocket. If you accept health insurance, you’ll likely have the opportunity to help more people, and to build a thriving business in the process.

Still, navigating the world of health insurance can be hard, especially if you’re not used to it. Every insurance provider is different, and every client has different coverage, which can quickly make things feel complicated.

The good news: You’ll probably end up following the same few steps when you bill insurance for therapy sessions. And fully understanding and optimizing the process can help ensure you get paid. 

Read on to learn everything you need to know about how to bill insurance for therapy.

First things first: You’ll need to get credentialed

Before you can start billing insurance companies, you’ll need to join insurance panels. Basically, you’ll submit a bunch of information about yourself and your practice to insurance companies, who will ultimately determine whether they want you to join their panel of mental health providers. 

Once you identify the insurance panels you want to join, you’ll need to get individually credentialed with each one. There’s no way around it: Credentialing, while essential, can be cumbersome. “It takes several hours of work per insurance company to get credentialed, because it’s a really detailed and intimate process,” says Abby Gagerman, a therapist in Chicago and founder of AEG Wellness

Before you begin the process of joining insurance panels, gather all the information you’ll need (it’s a lot). When you start working as a therapist, you’ll get a ten-digit NPI (national provider identifier) number. Keep this number handy (or look it up in the NPI database when you need it). You’ll also need to share details like your resume, license information, and specialties, along with providing evidence of your liability insurance and professional references. 

It’s quite a bit of work to get credentialed, but it’s for good reason: Insurance companies are obligated to make sure you are who you say you are before referring clients to you.

Insurance made easy: Build your practice with Headway

Headway is a free service that makes it easier and more profitable for therapists and psychiatrists to accept insurance. From credentialing, to built-in client documentation, to free CEUs and dedicated support, Headway provides the foundation you need to grow your insurance practice.

Verifying and authorizing client coverage

Once you’re paneled, you’ll work with clients to determine their coverage. Gagerman says many insurance companies have online programs or software that make it easier to look up a client’s plan before you bill.

Every client has a different insurance plan, so once you verify coverage, be sure to let them know whether they owe a copay or if the insurance covers the entire session. Some plans also only cover a certain number of therapy sessions, or types of therapy, which is important to tell the client.

Filing a claim, and related paperwork

Before you can file a claim, you’ll need to determine the client’s diagnosis and treatment plan. Each time you file, you’ll need to include the diagnosis and the type of therapy you provided in light of that diagnosis. “Understanding coding helps streamline the billing process,” says Gagerman. 

If you don’t use a service like Headway, you’ll probably also use the insurance provider’s program or software to create and submit claims, so keep your log-in information on hand. Gagerman says she submits a claim for each session. In the event of a denial or coverage issue, she reviews the rejection. “If it doesn’t make sense, I will follow up with the insurance company,” she says. “Sometimes the insurance provider makes mistakes, or sometimes they need more information before covering something.”

Getting paid

The best part of filing a claim: Getting paid! You have a few options when it comes to getting paid by insurance companies, says Gagerman. You can opt to receive paper checks, or you can elect to receive your payments via electronic funds transfer (EFT). She recommends the EFT route so checks don’t get lost in the mail (and because it’s sometimes difficult to deposit a large amount of money with mobile banking). 

Each insurance company is different; some may pay you weekly, while others may deposit payments monthly. You might receive individual payments for therapy sessions, or you might get paid for multiple sessions or clients in a lump sum. In any case, understanding the ins and outs of billing can ensure your client’s sessions are covered and you get paid. 

If you partner with Headway to handle your billing, you’ll get paid twice monthly and have renewed space to focus on helping your clients.

Can a non-licensed therapist bill insurance?

Only licensed providers can practice psychotherapy, and only credentialed providers can get paid by insurance companies. But that doesn’t mean only the licensed, credentialed provider can actually manage the billing. In fact, many therapists choose to hire administrative staff or sign up for services like Headway to make billing easier and save time to focus on actually providing therapy.

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