In and out of Network
"There is no way of getting all you want"
- Sheldon Kopp -
There are basically two forms of coverage through any health insurance plan: "In-Network"and the "Out-of-Network" Coverage.
Insurance companies contract medical (physicians or psychiatrists, for example) as well as mental health professionals (psychologists, for example) to form what they call a "network of service providers.” Those are called in-network providers. An incentive for providers to join insurance networks is their services are marketed to the insured by the insurance company. Their lists of in-network providers are part of any insurance company's website. Those who inquire with their insurance company about covered services usually get a referral to an in-network provider. In return, in-network therapists accept a lower fee than the customary fee. In other words, the service is offered below market price.
The provider is reimbursed directly by the insurance company for billed services. This way the out-of-pocket expense of the insured is limited to a relatively low co-pay, and therefore appears to be more attractive to anyone seeking help with mental health issues.
However, the contract between provider and insurance company requires the in-network provider to adhere to the insurance company's treatment guidelines. Those requirements basically put the insurance company or their managed care service in charge of the treatment.
Out-of-network providers are state-licensed therapists as well, who have chosen not to contract with a particular insurance plan or company, and are therefore not found on an insurance company’s "list of service providers".
An out-of-network provider might be a bit more expensive, but has the freedom to practice without many of the limitations the insurance companies are putting on treatment provided by their in-network providers. The treatment contract is solely based on the agreement between the provider and the client.
That requires both parties to take responsibility for the therapy work without a third party (the insurance company) either being involved and/or imposing guidelines for the treatment process. That ultimately puts the clinician in charge of the therapy — and not the insurance company.
The fee arrangement is between the client and the therapist. However, many insurance plans provide for “out-of-network" coverage, which requires them to reimburse licensed providers in accordance to the plans provision. Usually, they reimburse after a deductible has been met between 50 and 80 percent of what they call reasonable and customary fees or 50 to 80 percent of their in-network fee. What they base the reimbursement rate on is information they usually do not share with their customers, the client. The insurance holder often can only find out how much the reimbursement actually is after the first bill has been submitted.
If the client has an insurance plan that includes out-of-network coverage, the client can either submit the bill himself/herself to the insurance company and get reimbursed or he/she can usually assign the benefit to the provider of service. In that case, the therapist would submit the bill directly to the insurance company and the client would be responsible for the difference between the agreed upon fee and the percentage of the fee the insurance plan pays.
However, either way working with an out-of-network provider means the client basically agrees to be ultimately responsible for the agreed upon, fee regardless of his/her insurance status.
Out-of-network, a client's confidentiality can be better protected because clinical information must not be shared with managed care and insurance companies. However, if claims are submitted to get reimbursed for the service fee, insurance companies sometimes request after a predetermined number of sessions — even on an out-of-network base — a so-called "outpatient treatment report" in order to determine if the rendered therapy is "medically necessary.” This requires the therapist to fill out forms to give the insurance company, filled with information that is already implied in the diagnosis. The information is limited to the medical aspects of the presented problem and the severity of the interference with the client's functioning in daily life. (See: "The Trouble with Mental health Insurance", "The Dehumanization of the Mental Health Field" and "The Business with Mental Health").
To prospective clients, as well as those who are already involved in psychotherapy:
If your plan does not provide sufficient coverage for your therapy or if you want to continue psychotherapy after managed care has decided to either end or refuse its responsibility to pay in accordance to their plan provisions, talk to your individual therapist about cost alternatives available to you.
Without an insurance company being involved, confidentiality is guaranteed and your provider may be able to draw from a wider range of treatment modalities that best fit your needs. In addition, the duration of treatment and cost of your therapy is decided in consultation with YOU and the therapist of your choice. If there is anything we can help you with, please don't hesitate to ask. Your mental health is a cooperative effort.
Courage is the first of Human Qualities,
because it is the quality that guarantees the others.
- Aristotles -