What does it mean to be a private pay or out-of-network therapist?
Written By: April Widdes, LCPC, Board Approved Supervisor
Finding a therapist can be quite a lengthy process. And finding one who accepts your insurance can be even more challenging. I want to take this time to help our readers understand what it means when a therapist does not accept your insurance.
There can be different terms to refer to a practice or therapist who does not accept insurance. Those include, “private pay,” or “out of pocket” which is describing the costs associated with a service that the client will be paying for. This pay structure means, the client pays the therapist upfront and directly for the fees indicated for the therapist’s services. These fees should be made clear to clients.
Another possible term you may here is “out-of-network,” with insurance. This is when a client has out-of-network benefits, often included with PPO plans, which then allows them to see any therapist of their choice, regardless of whether the therapist is in-network or not with their insurance. In this case, the client is still agreeing to pay for services up-front to the therapist, provide a medical reason for seeing a therapist to their insurance, and providing proper documentation for services to the insurance company. Then the insurance company will reimburse you (the client) for some of your out-of-pocket expenses. Each insurance plan is different, and it is necessary to check directly with insurance on the exact reimbursement percentage, but this option can include possibilities of 60-90% of the total costs. If your therapist identifies as being “out-of-network,” they will provide you with a Superbill, a detailed invoice (or receipt) of the services your therapist provided to you. This document is then submitted to the insurance company for reimbursement. We realize health insurance is important and costly and therefore many people want to be able to utilize it. This is an advantage to plans that include out-of-network benefits because, finding a provider who fits your needs vs. accepts your health insurance coverage, allows you to still use your insurance.
Insurance can also include stipulations that may dictate a client’s treatment. Such as how many sessions insurance will approve, length of treatment, requirement to have a diagnosis, etc. Beyond that, many professionals in the health care field realize that working with health insurance companies becomes extremely time consuming. This can take away from the time and bandwidth of the therapist they have available to dedicate to their clients and their own self-care. We think it is wonderful for those practices and therapists who can have a team or ability that allows them to accept insurance, however, we realize many small practices are unable to do this. Many private practice therapists who chose to be self-pay or out-of-network hold a similar belief that by not taking insurance, we gain additional freedom that allows us to provide the best care possible.