Summary. Mental health care that’s expensive to the point of being inaccessible has been an issue for a long time, but it has taken on new urgency during the Covid-19 pandemic. For many people, waiting for insurance companies to get it together is not an option right now. Luckily, you may not have to wait. There are steps you can take to better manage these costs.
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There’s no other way to put it: Health insurance plans are confusing. For young people navigating them for the first time on their own, it can be difficult to figure out what’s actually covered and what’s not — especially when it comes to mental health.
Thoughfederal laws requireinsurance companies to cover mental and physical health issues equally, deep disparities persist between the two. In fact, 42% of people struggle to cover high costs related to mental health. Even if you’re insured through your school, your parents, or your job, any treatment beyond mindful meditation can be difficult to afford.
Mental health care that’s expensive to the point of being inaccessible has been an issue for a long time, but it has taken on new urgency during the Covid-19 pandemic. Last year,almost 80% of people aged 18 to 24 and more than 75%of people aged 25 to 34 who took an anxiety or depression screen scored with moderate to severe symptoms.
While younger generations, specifically Millennials, are more likely to attend therapy than their predecessors,20% of those diagnosedwith major depression don’t seek treatment — and it’s not hard to imagine why. Even with insurance, the copay for a therapy session can range fromjust a few dollars to $50 or more.
For many people, waiting for insurance companies to get it together is not an option right now. Luckily, you may not have to wait. There are steps you can take to better manage these costs. Based on my experience as the CEO and co-founder of a health savings account (HSA) provider, here are a few tips for getting yourself set up with (affordable) mental health care:
A Guide to Confusing Health Care Terms
This is not an exhaustive list by any means, but these are the terms that will come up most often as you navigate mental health care costs and decide what route is best for you.
Out of pocket:
When you pay out-of-pocket expenses, it means you’re covering the cost of care with your own money. Though you may be reimbursed for these costs later, this term refers to the amount you pay for your deductible, coinsurance, copay, and premium.
Deductible:
This is the amount of money you are required to pay out of pocket before your insurance actually kicks in. If your deductible is $1,500, for instance, you will be responsible for putting that amount of money toward your medical costs each year.
Copay:
A predetermined amount of money you pay for in-network doctor visits, prescriptions, therapy, and other care at the time you receive it, which does not go toward your deductible amount. Not all plans have associated copays.
Coinsurance:
After you’ve reached your deductible (without adding the cost of copays) and your insurance company starts helping you out, you will still be responsible for paying a percentage of your medical costs. That percentage is called your coinsurance rate. Let’s say you meet your $1,500 deductible and then book a $100 doctor’s visit, for instance. If your coinsurance rate is 20%, you would pay $20% of $100, or $20 total, for the appointment, and your insurance would cover the rest.
Premium:
The fee you pay every month to your insurance provider for health care coverage.
Reimbursement:
You can sometimes get money back for insurance costs you’ve already paid — often by submitting a claim. Most insurance companies will guide you on how and when you are able to do this.
In-network:
Not every doctor or medical institution works with your insurance company to provide lower rates for care.“In-network” refers to the ones that definitely do. For example, if you’re insured by Blue Cross Blue Shield, and your therapy appointments are covered by the company, then your therapist is what we call an “in-network provider.” You can see in-network providers at a lower cost than out-of-network providers.
Out-of-network:
Out-of-network providers don’t have set agreements with your insurance company to offer lower rates. Naturally, they are more expensive — you often have to pay entirely out of pocket to see them. Sometimes, you can submit a claim to get reimbursed for some of that cost, but it will depend entirely on your plan.
HDHP (high-deductible health plan):
These health care plans have lower monthly premiums and higher deductibles ($1,400 or more for individuals and $2,800 or more for families). They can come in the form of HMOs, PPOs, or EPOs. To offset those out-of-pocket costs, these plans may include HSAs. Low-deductible health plans, on the other hand, offer lower deductibles but often come with higher monthly premiums.
HSA (health savings account):
HSAs are savings accounts used specifically for certain health expenses. They have a triple tax advantage, which means you put tax-free funds into them, that money grows free of tax, and it can be withdrawn tax-free when you need it. The money you contribute is taken straight from your paycheck or transferred from your bank account.
Summary of benefits and coverage (SBC):
The details of your health insurance plan, which will indicate whether mental health and other services are covered — and how much they will cost you.
Educate Yourself Before Choosing a Mental Health Provider
The sheer number of unfamiliar terms you’ll encounter when deciding whether you can afford the cost of mental health care under your insurance plan may feel overwhelming.
Explore Multiple Options
Take some time to think about what you want from a mental health provider (aka a therapist or psychologist). Depending on your location, you may have multiple options. To land on one that will be best suited to your needs, do some good old-fashioned Googling to see what other patients have said about the provider you’re interested in. The National Alliance on Mental Illness (NAMI), the American Medical Association, and the Association for Behavioral and Cognitive Therapies are good resources to check out.
You should also visit each provider’s website to learn whether or not they accept your health insurance. Most insurance companies will have a list of in-network providers available online, or you can call your insurance company and ask it to send you a list of in-network mental health professionals.
If you’re already seeing a therapist that you pay for out-of-pocket,discuss whether they would be willing to offer a discount or payment plan to help you manage the costs. If they won’t and the care is straining your budget, consider switching to an in-network provider.Working with only in-network therapists or psychiatrists may limit the number of doctors available to you or extend how long it takes to find someone you like, but the long-term savings may make it worthwhile.
Last but not least, beware of out-of-network providers thatoperate from in-network hospitals or treatment facilities. Astudy by Health Affairs foundthat as much as $40 billion a year is spent on patients receiving treatment from out-of-network providers (often unknowingly) through in-network facilities.
Understand Reimbursement Protocols
Let’s say you already have a preferred mental health care provider who charges $200 per visit.If this provider is not in your insurance company’snetwork, you may be on the hook for the total cost of your treatment. But, if your insurance plan offers reimbursement, you can get some of those funds back by submitting a claim.
This will depend entirely on your health plan. Some companies provide reimbursement for a range of services, including therapy, medical management, psychological testing services, etc. Check your “summary of benefits and coverage” (SBC) to figure out whether yours is one of them. Your SBC is normally sent to you when you enroll in a health plan, and it can also be found on your insurer’s website.
Just remember: Even if your plan says mental health is covered, that doesn’t meanallservices are included.How much actual “coverage” an insurance plan provides often varies considerably, so be sure to explore your policy’s repayment details.
Save Strategically
If you have a high-deductible health plan (HDHP) that doesn’t include your preferred mental health provider in its network — and the out-of-network benefits for mental health are insufficient for your needs —consider redirecting your premium savings to an HSA and purchasing mental health care directly.
An HSA enables you to pay for out-of-pocket mental health care costs with pretax dollars.With an employer-sponsored HSA, you deduct money from your paycheck before it’s taxed by the government to pay for treatment — and can thereby reduce the wages you pay taxes on. If your HSA doesn’t come from your employer, you can add money from your bank account, and the tax savings will come when you file your taxes for the year.Depending on your tax bracket, or the tax rate you pay based on your income, an HSA could help you save 15% to 37% on health care expenses.
For example, let’s say you fall in the22% tax bracket (for anyone earning $40,526 to $86,375)and pay $150 for an out-of-pocket therapy session. With an HSA for mental health, you would save $33 on each session in the form of tax savings. That’s basically free money in your pocket.
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Consider Online Therapy
Compared to other forms of health care, therapy is ideally suited to telemedicine. After all, speaking to someone on Zoom (or chat, text, email, or phone) is the closest we can get right now to conversing in the same room. Andaccording to multiple studies, it is just as effective as in-person treatment. There are numerous great options for “remote” mental health care available that are more convenient and less expensive.
Furthermore, you may be able to subscribe to online therapy providers and pay a set fee per month for unlimited access to a therapist, which could provide a higher level of treatment at a lower cost than paying for individual appointments with an in-person therapist. For example,Talkspace costs $65 to $99a week if you get billed monthly — or $52 to $79 per week if you choose to pay for three or six months in advance. Online therapy might not be the right fit for everyone, but it’s always worth considering.
Until insurance providers start treating mental and physical health care the same, you have to be your own advocate. Educate yourself about your plan options, provider networks, and payment policies. And don’t be afraid to think outside the box. An HSA might seem complicated, for example, but it’s one of the best ways to save on treatment if you lack adequate mental health insurance coverage. Cost should never compromise care; as long as you’re proactive, it doesn’t have to.