As a mental health provider, offering your clients clear and comprehensive
information about their payment options is essential. Clients often cite cost as their most significant barrier to starting or continuing care. Clients can use their insurance benefits or pay out-of-pocket using a self-pay (cash) rate for their sessions. Understanding the differences between these options can help you navigate conversations where a client's financial situation becomes a stressor or a full-on blocker to care.
Key Takeaways
Clients most often cite cost as a barrier to starting or continuing care.
The Grow platform empowers clients to use insurance or self-pay (cash).
Using insurance is often the best option for clients. However, gaps in the coverage or a high-deductible may make self-pay more compelling.
Using insurance benefits
Cost Savings: Insurance can significantly reduce out-of-pocket costs for clients, especially if they have a comprehensive mental health coverage plan. By using insurance, clients may only need to pay a copay or meet a deductible, which can be more affordable than the full session fee.
Network Considerations: Verifying whether your practice is in-network or
out-of-network with the client's insurance provider is essential. In-network services usually cost significantly less for the client, as the insurer has negotiated a lower rate with the provider. Furthermore, Grow Therapy does not bill insurance providers for which we do not have a group contract.
Coverage Limitations: Clients should be aware that their insurance may have limitations, such as a cap on the number of covered sessions per year or restrictions on the types of services covered. Encourage clients to contact their insurance provider for detailed information about their benefits.
Choosing self-pay rates
Flexibility: Self-pay clients often have more flexibility in choosing the frequency and duration of their sessions, as insurance limitations do not apply. This flexibility can be particularly beneficial for clients who require a more personalized treatment plan.
Transparent Pricing: Self-pay rates provide clients a clear understanding of their financial commitment upfront. This clarity can help clients avoid unexpected costs and simplify their therapy budget.
No Insurance Restrictions: Clients paying out-of-pocket are not limited by insurance requirements or approval processes, allowing for a more tailored therapeutic approach. This tailored approach may include access to specialized services or extended sessions that insurance may not cover.
Access to Services: Self-pay rates can be a more accessible option for clients without insurance or with high deductibles. They allow them to receive the care they need from a wider selection of providers without the financial barrier of meeting a deductible.
High deductible plans vs. self-pay rates
What is a deductible? A deductible is a set amount of out-of-pocket spending. With a deductible plan, the insurance company determines the out-of-pocket price per session. Once the client has reached their deductible amount, their insurance company will start contributing to their therapy costs. The client's plan determines the set amount or percentage they cover.
What is a copay? A copay is a fixed cost per service. If your plan states that the mental health benefits are subject to a copay, sessions will cost the same, regardless of the CPT code(s) billed by your provider following your appointment(s).
Should your client use a high-deductible plan for therapy? This decision depends on various factors, including the size of the client's deductible, the cost of their care, the amount of care they expect or desire to receive, and their provider's self-pay rate. Consider the example below:
Scenario: Weekly Talk Therapy Sessions
Patient Profile:
Name: John Smith | Age: 35
Health Status: Generally healthy, seeking therapy for mild anxiety
Insurance Plan: High-deductible health plan (HDHP) with a $3,000 deductible
Self-Pay Option: Cash payment for services
Procedure: Weekly Talk Therapy Sessions
Cost of Therapy Session (Self-Pay): $80 per session
Cost of Therapy Session (Insurance): $120 per session (due to negotiated rates and administrative fees)
Insurance Details:
Annual Premium: $1,500
Deductible: $3,000
Copay: 20% after deductible is met
Analysis
Using High-Deductible Insurance Plan:
Annual Premium: John pays $1,500 annually for his insurance.
Cost of Therapy Sessions: Since John has not met his $3,000 deductible, he must pay the full cost of the therapy sessions out of pocket until he does.
Cost per Session: $120 (insurance rate)
Total Cost for 52 Sessions: 52 sessions * $120 = $6,240
Total Cost for the Year: $1,500 (premium) + $6,240 (therapy sessions) = $7,740
Using Self-Pay (Cash Payment):
Annual Premium: $0 (no insurance premium)
Cost of Therapy Sessions: $80 per session (self-pay rate)
Total Cost for 52 Sessions: 52 sessions * $80 = $4,160
Total Cost for the Year: $4,160 or $5,660 while maintaining unused insurance
Conclusion
In this scenario, John would save significant money by opting for self-pay rather than using his high-deductible insurance plan. The self-pay option costs him $4,160 for the year for weekly therapy sessions, whereas using his insurance would cost him $7,740 for the year when considering the premium and the out-of-pocket cost for the sessions.
This example illustrates that self-pay can be more economical for regular, ongoing medical services like talk therapy than a high-deductible insurance plan, especially if the patient does not anticipate needing other extensive medical care throughout the year.
Additional Resources
Information on managing your self-pay (cash) rates and billing clients on a sliding scale is available below.