6 Reasons NOT to Use Your Health Insurance to Pay for Therapy

Health Insurance

Have you ever considered paying for therapy out of pocket, instead of using your health insurance?

If your health insurance covers the cost of counseling services, probably not. Before I became a therapist, it never crossed my mind to pay any of my healthcare out of pocket—especially if I could take care of everything with a measly $25 co-pay. Now that I’m on the other side of the fence, I actually pay for much more of my healthcare instead of relying on my insurance (and this includes paying out of pocket for my own therapy).

If you’ve read this far, you’re probably wondering, “But I have insurance…why wouldn’t I use it? Why pay more?” I understand the allure of using your health insurance to cover the majority of the session fees, but do you realize what you give up for that co-pay? If not, allow me to shine some light on the truth. I’ve learned a lot of things throughout my career as a therapist. Things consumers don’t know. Things that I would want you to know if I were you. And so I’m here to tell you the things I want all clients to know before/when they are using insurance-approved therapists.

1. Your therapist has to diagnose you to get you reimbursed.
Insurance companies require a diagnosis so they can decide if they will pay for therapy or not. This means your therapist must give you a diagnosis that your insurance will cover even if you don’t really need a diagnosis. And these diagnoses follow you. In many cases, mental health diagnoses do not have a statute of limitations meaning they will follow your forever as “pre-existing illnesses.” As a client it is rare that you ever even know your diagnosis, so I would consider this to be one of the most motivating reasons to pay out-of-pocket because when you do, your therapist does is not required to give you a diagnosis.

2. Your records are not protected.
Your insurer can audit your records at any time they wish. This means any details that your therapist might not have included in the paperwork (perhaps for good reason) is technically open to the eyes of any “claims specialist” the company hires. Again, this might not matter to you. But if you hold high clearance for a job, or have other reasons you want your information to be held confidential- this is important to know.

3. Your care is dictated by the health insurance company.
Whenever you are diagnosed, the insurance company will decide how much treatment and what type of treatment you will receive. Meaning, rather than giving you the best care possible that suits your needs, you will be designated a treatment plan based on your health insurance company. Simply put, the care of the client is dictated by the insurance company, and the therapist essentially works for the insurance company, not the client. This can compromise the quality of mental health services provided.

4. Insurance almost never pays the full fee.
This means you are either going to be responsible for the remainder (which you need to clarify ahead of time) or it means your therapist is working for less than a fair market wage. Most insurance companies reimburse therapists at a very low rate, typically lower than the set fee from the clinician. It makes it hard to do good work with clients when your therapist is worrying about how he or she is going to pay their bills and sustain a practice.

5. You may end up seeing a generalist therapist, instead of one with the unique skill set you need.
While many therapists are qualified to treat common challenges such as anxiety’s or depression, if you are interested in working with a specialist to address a specific challenge, you should consider looking out-of-network. Private pay therapists often have niche practices, and if you come across a therapist whose skills speak directly to your needs—perhaps needs you didn’t even know to look for—it’s worth reaching out.

6. Less investment in the counseling process.
When people pay for therapy out of pocket, they have more emotional buy in and commitment to therapy. Paying with our own money tends to make us work harder and better appreciate the services we are paying for. Plus, therapy is very affordable. Even at a rate of $100 per hour, you could get 30 hours of therapy (which is far more than the average time needed), for less than getting your kid braces, than two months of an average mortgage payment, about the same as some people pay for one big-screen television, WAY cheaper than a divorce, etc.

So what can you do about it? There are options!

If possible, pay cash for sessions. This ensures that your records and diagnoses are entirely confidential documents. The content of your session stays entirely between you and your therapist. And your care is dictated by what you think you need, not your insurer. Many people have a Health Savings Account (HSA) or Flexible Savings Account (FSA) that will help them pay for sessions and operates just like cash- but they don’t realize it.

If you cannot afford to do that, consider a non-profit. Many areas have nonprofits that offer low fee counseling based on income or other eligibility. That takes a little digging, but often you can find it on google by looking for “low fee” or “affordable” or “nonprofit” counseling. You will likely see less experienced clinicians, but you will maintain control and confidentiality.

See if your insurance company will reimburse you for out-of-network services. This will cost you up front, and your diagnosis will be recorded, but it gives you the freedom to choose any licensed clinician and their records are more protected than if you go with an in-network therapist. Contact your insurance company directly to inquire about the out-of-network reimbursement policy specific to your plan. Your therapist will provide you with a statement/invoice, known as a “Superbill”, that you will be able to submit for reimbursement.

Therapy, especially when you are paying out-of-pocket, is always an additional expense, in more ways than one. There are travel expenses and the time commitment that it takes to make therapy effective. However, the rewards can greatly outweigh temporary monetary costs. How much is too much to pay for peace of mind, the renewal of a relationship, or finally finding freedom in an area of life that has previously seemed unattainable? $500? $1000? $5000? Some people would pay ten times that to experience the real progress and change that can happen in therapy. What is the change you are seeking worth to you?

If you’d like to discuss your options around paying for therapy, contact me todayemail me, or call me at (585) 615-6985 for a free initial phone consultation.

Tips for Finding a Therapist That’s Right for You

Finding a Therapist
So, you’ve decided to see a therapist…


You’ve taken a big first step on your journey towards a happier, healthier you. Your next step is to select a counselor or therapist, which can oftentimes feel like a daunting and overwhelming task. There are so many different types of therapists out there, so many styles and approaches, so many degrees and credentials. Where do you even begin? What do you look for?

First, take a deep breath! There are ways to make this imperfect process a bit easier. Here are some recommendations to help you in your search from my own experiences as a client as well as a therapist.

Ask friends or people you trust for referrals.

Asking people you trust for recommendations is a great place to start. Word-of-mouth is usually the best way to begin an initial search for a counselor or therapist because you’ll know exactly how the potential clinician works based on insight. Get recommendations from friends, relatives, your primary care doctor, your clergyman, or your local professional association. While the right “fit” for your friend or relative may not reflect what will feel right for you, it gives you a starting point with a therapist who has already been vetted by someone you trust.

What’s with all those letters?

There are many educational paths and professional programs that can prepare someone to conduct therapy—with MSW, MA/MS in Mental Health Counseling, and PsyD or PhD in Clinical Psychology being the most common graduate degrees you’ll likely come across in New York State.

Try not to focus too much on the specific degree your therapist holds, as all of these graduate-level tracks sufficiently train students to provide therapy in a variety of styles designed to treat a multitude of presenting issues and personalities. Instead, make sure that the clinician is licensed (or is in the process of getting their licensure, supervised by a licensed therapist). Licensed therapists are bound to certain ethical and legal standards and must obtain an appropriate level of education, training, and supervised clinical experience. To verify the license of a counselor or therapist, simply perform a Google search for your state’s Professional Licensing Board. To look up a mental health professional in the State of New York, click here.

Ask yourself if you need a specialist.

Ask yourself, “What am I seeking treatment for?”

Then look for a therapist who specializes in treating this particular type of issue or problem. I tend to be wary of people who advertise that they specialize in treating EVERYTHING. One cannot be all things to all people. Look for someone who clearly states who they like to work with or focuses on a specialty in their profile.

What does it feel like for you to sit with the therapist?

Pay attention to how you feel sitting with this person. Do you feel comfortable? Safe? At ease talking with them? Is the therapist down-to-earth or does he or she feel cold and emotionally removed? Is the therapist arrogant or a “know-it-all”? A therapist that is a good match for you will make you feel safe, comfortable, and heard. If a therapist doesn’t feel like a good fit for you, that’s okay; there’s absolutely no contract or rule requiring you to continue working with any one particular therapist.

Has your therapist does his or her own therapy?

Surprisingly, many therapists are not required by their training programs to complete any of their own personal therapy. Yet, one of the best ways to learn how to help someone else heal is to do your own therapy. Someone who has done their own work is usually much more aware of their own biases and perspectives and how they might influence their work with you. They are also more likely to be self-reflective and display humility in their work. The most effective healers tend to be “wounded healers”—those who, through the process of healing their own wounds, have developed the know how to help others heal theirs.

The relationship is more important than the resume.

Research has shown that at the heart of all successful therapy is the therapeutic relationship that develops between the client and the therapist. Without a strong therapeutic alliance, the chances of a successful outcome in psychotherapy are significantly lowered. So, despite a therapist’s chosen theoretical framework or use of particular therapeutic techniques, the first thing you need to look for in finding a good therapist is simply someone with whom you can feel some degree of comfort and eventual trust.

Selecting a suitable therapist should not be a rushed decision. It will likely take time and a bit of effort on your part to find a good fit, but it will be well worth it once you’ve found the right one. The therapeutic relationship can be one of the most life enhancing, rewarding relationships and experiences you’ll ever have.

Wishing you the best of luck in your search!