How To Bill Insurance As A Therapist: A Step-By-Step Guide

Billing insurance as a therapist can involve navigating credentialing, diagnosis and service codes, claim submissions, and the occasional denied claim. While the process may feel complex at first, breaking it into clear steps can make it more manageable. Learning the essentials of insurance billing for therapists can help you get started.

Understanding in-network vs. out-of-network billing

In-network agreements often mean accepting a contracted rate set by the insurer, which can make services more affordable for clients and may bring in a steady flow of referrals. Out-of-network providers may have more flexibility in setting their own rates, but this approach often shifts more cost to clients, who may need to pay more directly and seek reimbursement themselves.

There can be trade-offs with either path. In-network billing may involve more administrative work and lower per-session rates, while out-of-network billing may offer higher rates with a smaller client pool. The table below compares a few key factors that may help you decide which approach suits your practice goals.

Once you have decided which path fits your practice, the next step for in-network providers is getting credentialed with the insurance companies you want to work with. When you're ready to explore your options, you can get started at any time.

How to get credentialed with insurance companies

Before you can bill an insurer as an in-network provider, credentialing is required. Credentialing serves as validation that a therapist is properly qualified to deliver mental health services. The process is significant, as it is often part of:

• Building trust between clients and mental health professionals
• Demonstrating adherence to specific standards outlined by insurance companies
• Increasing the likelihood of collaboration with insurance companies

Credentialing timelines can vary, but the process often takes 60 to 120 days from submission to approval. It can help to begin early and to verify the specific requirements with each company before submitting, since subtle differences may exist between insurers. Unless there are changes to your information, you will typically only need to complete this process once per insurer.

Documents you may need for credentialing

Gathering your paperwork ahead of time can help the process move more smoothly. Here are the documents you may need to have on hand:

• Details of your professional liability coverage and malpractice insurance
• Your practice license
• Your practice tax ID number
• Your National Provider Identifier (NPI)
• A completed application form for each insurer

Completing the CAQH application

Many insurers use the Council for Affordable Quality Healthcare (CAQH) ProView system to collect provider information. Completing the CAQH ProView application often involves self-reporting details about your education, training, work history, and experience, then uploading supporting documents such as your license and liability coverage.

Once your profile is complete, it can help to keep it up to date and to re-attest to its accuracy periodically, as many insurers pull from this system when reviewing your application. Keeping this profile current may reduce delays when you apply to additional panels.

Choosing which insurance panels to join

Finding the most advantageous insurance partnerships for your practice can involve researching the demographic of clients you wish to serve, whether locally or virtually. It can be helpful to take note of the predominant employers in your area or to consult with colleagues to get on the same page about the insurance plans offered to employees.

Taking the time to identify which insurance providers offer the most competitive reimbursement rates can also help you decide where to focus your efforts.

Key insurance billing terms to know

When approaching the billing process, it can be helpful to understand a few core terms. Here are some that come up frequently in mental health billing:

• Insurance provider or insurer: the entity providing financial coverage for healthcare services
• Billing claim: a formal request submitted by a healthcare professional to an insurer, seeking coverage for treatment costs
• Claimstatus: the stage a claim is in as the insurer processes and evaluates it for validity before approving payment
• Credentialing: the process confirming a therapist's qualifications and experience, which is often required before participating in insurance billing
• CPTcodes: standardized service codes that help insurers identify the specific type of treatment provided during a session
• ICD-10 codes: standardized diagnostic codes that describe a client's condition or reason for treatment
• Priorauthorization: advance approval from an insurer that may be required before delivering a specific service
• Explanation of benefits (EOB): a statement from the insurer describing what was covered, what was paid, and what the client may owe

With these terms in mind, it can be easier to understand how codes work together to describe the care you provide.

Understanding CPT and ICD-10 codes for therapy

Two types of codes work together on most claims. CPT codes describe the service you provided, while ICD-10 codes describe the client's diagnosis or reason for treatment. Using the correct codes is often critical for claim approval, since even a small mismatch can lead to a denial.

Common CPT codes for therapists

Current Procedural Terminology (CPT) codes designate and categorize the treatments provided. Below are several codes commonly used in therapy, along with brief guidance on when each may apply:

• 90791: initial diagnostic interview or assessment, without additional medical services
• 90832: individual psychotherapy for a 30-minute session
• 90834: individual psychotherapy for a 45-minute session
• 90837: individual psychotherapy for a 60-minute session
• 90846: family psychotherapy without the patient present
• 90847: family psychotherapy with the patient present

Choosing the code that most accurately reflects the length and type of session you provided can help ensure your claim is processed correctly.

ICD-10 diagnostic codes for mental health

While CPT codes describe what you did, ICD-10 codes describe why. These standardized diagnostic codes are typically required on claims so the insurer can understand the clinical reason for the service.

A few examples of common mental health diagnostic codes include F41.1 (generalized anxiety), F32.9 (major depressive disorder, single episode), and F43.10 (post-traumatic stress disorder). Selecting an accurate diagnostic code that aligns with your clinical documentation can support both proper billing and continuity of care.

Verifying client insurance benefits and eligibility

Before a first session, it can help to verify a client's benefits so both you and your client understand what may be covered. This step may help prevent surprises, reduce denials, and give clients a clearer picture of any out-of-pocket costs.

To begin, it can be useful to gather key details from the client, such as their insurance card, member ID, and group number. From there, you can contact the insurer directly or use an online provider portal to confirm coverage, copays, deductibles, and any limits on the number of covered sessions. Some practice management software can automate parts of this process, which may save time as your caseload grows.

Once you have confirmed a client's coverage, it can also help to check whether the insurer requires advance approval for the services you plan to provide.

When prior authorization may be required

Prior authorization, also known as preauthorization or precertification, is a cost-control process used by some health plans that requires providers to obtain advance approval before delivering a specific service. This approval is often necessary for the service to qualify for coverage.

Because there is a lack of standardization in this process, securing prior authorization can be challenging. Still, it can serve two helpful purposes:

1. Helping ensure reimbursement for provided services

2. Safeguarding clients from unforeseen out-of-pocket expenses

Along with educating and advocating for healthcare providers, the American Medical Association offers prior authorization practice resources and guides.

With benefits verified and any needed approvals in place, the next step is submitting the claim itself.

How to submit insurance claims for therapy sessions

Submitting claims is a core part of learning how to bill insurance as a therapist, and it calls for precise execution. This process is typically done electronically, though paper claims are still used in some cases. Accuracy matters at every step, given that an estimated 80% of medical bills contain errors. Meeting each insurer's submission deadline is also important, and these deadlines tend to vary from company to company.

Information required on the CMS-1500 form

The CMS-1500 form is the standard claim form many therapists use to bill insurers. Completing it accurately can help your claim move through processing without delays. The key fields often include:

1. Provider's name and National Provider Identifier

2. Practice tax ID

3. Client information, including full name and date of birth

4. Details for each session, such as the date of service and the corresponding CPT and ICD-10 codes

Tips for submitting clean claims

Submitting "clean claims," meaning claims free of errors, can reduce delays and denials. To do so, it can help to follow a few guidelines before sending each claim:

• Cross-check every detail on the form
• Confirm that client identifiers match the information on their insurance card
• Review the insurer's requirements before submission
• Verify that the codes used accurately represent the services provided

Once you understand what submitting claims involves, it can be easier to decide how you want to handle the billing work itself.

Billing options for your therapy practice

There are several ways to manage mental health billing, and the right choice may depend on your caseload, budget, and comfort with administrative tasks. Below are a few common options with their trade-offs.

Handling billing yourself

You can handle the billing process on your own, either manually or through a health plan's provider portal when one is available. This approach can save on service fees, though it may require more of your time and a solid grasp of billing details to ensure information is accurate and claims are paid on time.

Using practice management software

Practice management software can offer streamlined billing capabilities, sometimes including tools that track when insurers pay and flag errors before submission. It can help to research options thoroughly to confirm that a given platform supports the functions your practice needs.

Outsourcing to a billing service

Outsourcing can be an option for practices that prefer to hand off the billing work. It involves collecting the necessary information for the biller and transmitting it. Billing services can come with a meaningful cost, so it may help to weigh the fees against the time you would save.

How to handle denied or rejected claims

Even with careful preparation, claims can sometimes come back unpaid. Understanding the claim denial vs. rejection distinction can help you respond appropriately. A rejection typically happens before processing because of a technical error, such as a missing field or mismatched client information, and can often be corrected and resubmitted. A denial means the claim was processed but not approved for payment.

Common reasons for claim denials

Knowing why denials happen can help you prevent them. Some of the most common reasons include:

• Missing or incomplete information on the claim
• Incorrect CPT or ICD-10 codes
• Lack of required prior authorization
• Services that are not covered under the client's benefits
• Eligibility issues, such as a lapse in the client's coverage

How to appeal a denied claim

When a claim is denied, it is often possible to appeal the decision. It can help to first review the explanation of benefits to understand the reason for the denial. From there, you can gather supporting documentation, such as session notes and treatment plans, that illustrate the necessity of the services.

After completing any appeal form the insurer requires, you can submit the appeal within the insurer's stated timeframe, which is often 30 to 180 days depending on the company. Keeping copies of everything you send can help you track the process.

How online therapy platforms can support your practice and simplify billing

Some therapists choose to work with online platforms that handle many administrative tasks, which can reduce the time spent on billing and paperwork and allow more focus on client care.

Research suggests that online therapy can often be an effective form of care for clients who prefer the convenience of this format. Working through a platform like BetterHelp can allow you to provide quality support—including sessions covered by insurance in some cases—in an accessible way.

Benefits of online therapy for clients

Seeking therapy online can often be logistically easier for clients than attending in person. Getting started is simple and attending virtual sessions can be convenient.

Also, some providers on platforms like BetterHelp, which works with one of the world's largest networks of more than 30,000 qualified therapists globally, may be in-network with certain health plans in select states, and co-pays average about $23/session for eligible members. Coverage varies by plan, provider, and therapist availability, so it can help to check in-network status on the BetterHelp site.

In addition to therapy, BetterHelp now offers psychiatry services through Uplift, an additional care option available alongside therapy that can be part of a holistic mental health care experience. This offering expands access to licensed psychiatric providers, and psychiatry services may include medication management when clinically appropriate, as determined by a licensed psychiatric provider.

Medication availability and coverage may vary by member location, clinical appropriateness, and individual pharmacy/insurance benefits. Prescribing decisions are made by the treating clinicians. We do not guarantee that any specific medication will be prescribed or covered by a member's insurance plan.