Managing all the ins and outs of insurance benefits and requirements when you or someone you love needs mental health treatment can feel overwhelming. Insurance providers tend to use overly technical language and complicated processes, which can make the whole claims system difficult to understand.
Plus, if your insurance claim is denied or your preferred provider is out-of-network, this can add to the confusion and frustration.
However, out-of-network mental health coverage, single case agreements, and formal appeals are all legitimate pathways to getting your care covered. And fortunately, they work more often than insurers might lead you to believe.
This article will cover what federal laws exist to protect your rights, as well as:
When a therapist, psychiatrist, treatment facility, or other mental health provider hasn’t signed a contract with your insurance provider, they’re considered to be out-of-network. This doesn’t automatically mean your insurance won’t cover anything, but it does mean their terms are likely different and less generous than they would be for an in-network provider.
Most people tend to assume out-of-network care just isn’t covered. But in reality, many plans (especially PPOs, or preferred provider organizations) include some level of out-of-network mental health coverage.[1]
Below, we discuss how these out-of-network benefits work and how they differ from preferred provider organizations (PPOs).
With out-of-network coverage, you’ll usually have to pay more upfront and may need to meet a separate deductible amount before your benefits kick in. Your plan will then reimburse you a percentage of what it considers the “usual and customary” rate for the service in question. This amount can be different from the rate the provider actually charges.
Usual and customary rates are what insurance companies pay based on what they’ve determined is a reasonable rate for that service in your area.[2] Therefore, asking your insurer for their rate for a specific service or level of care can be beneficial. This is because doing so helps you better calculate your likely out-of-pocket costs in advance of any services you access.
The gap between the provider’s fee and the insurance company’s reimbursement rate is known as “balance billing”, which is something to keep in mind when weighing your options for mental health care.
PPO plans are the plans most likely to include PPO out-of-network benefits for mental health, as they’re designed for more flexibility that allows you to see providers outside the established network.
HMOs, or health maintenance organizations, are usually more restrictive. They generally only cover out-of-network care in cases of emergency. So if you have an HMO plan and your preferred provider isn’t in-network, things can be a bit harder. Though options such as single case agreements (covered later on in this article) might still apply.
Before delving into the nuts and bolts of appeals and agreements, it’s helpful to know what the law guarantees you. Two pieces of federal legislation form the backbone of mental health insurance rights in the U.S.:
Passed in 2008, the MHPAEA requires that all insurance plans offering mental health benefits must provide them on an equal footing to medical and surgical benefits.[3] In other words, your insurer can’t impose stricter limits on mental health care than it does on physical care.
So, if your plan covers 30 days of inpatient treatment for medical issues, it can’t cap mental health admissions at 10 days. If your insurance company is violating the MHPAEA, you’re able to make a formal complaint or an appeal to their denial.
The ACA builds on the MHPAEA by classifying mental health and substance use disorder services as one of the ten Essential Health Benefits. Therefore, all plans sold on the marketplace are required to include them.[4]
It also extended parity protections to individual and small group-based plans that weren’t previously covered under the MHPAEA.
If you have a PPO plan, you likely have more insurance coverage than you realize, even for providers and facilities that are considered to be out-of-network. The catch, however, is that these benefits can vary widely from plan to plan, and insurance providers aren’t always forthcoming or clear about what’s available.
It’s always a good move to call the member services number listed on your insurance card to get more information. Some key questions to ask can include:
Prior authorization is the process by which you get your insurer’s approval before receiving certain kinds of care. Without it, they might refuse to cover the treatment, even if your plan includes mental health benefits.
Not every service requires prior authorization, but higher levels of care almost always do. This includes residential mental health treatment, partial hospitalization programs (PHP), and intensive outpatient programs (IOP).
Your treatment provider usually initiates the prior authorization request for you and submits clinical documentation for the insurance company to review before issuing an approval or denial. This documentation might include:
The turnaround times can vary, but insurance providers are typically required to respond in a set amount of time, with urgent requests usually receiving a faster decision than routine ones.
Approving a prior authorization revolves around medical necessity, a standard that insurers define according to their own criteria (and it can be frustratingly difficult to understand).
They typically want evidence that:
If your insurance provider isn’t responding, reach out and ask them to flag it as urgent, as they must respond quickly for more pressing matters.
Should your authorization be denied, you have the right to appeal. They will send you a letter that explains their reasoning, which can then be used as the basis for your challenge.
AMFM is here to help you or your loved one take the next steps towards an improved mental well-being.
Many insurance companies count on people accepting their denial, but fighting for your right to treatment can often be successful. Read over the denial letter carefully for the company’s rationale and information about the appeals process.
A formally written appeal should directly address the stated reasons for their denial and include:
If you think your insurance provider has violated federal parity laws, you can file a complaint with your state insurance commissioner. You can also do so via the U.S. Department of Labor if your plan is employer-sponsored.
A single case agreement (SCA) is a one-time contract between your insurance provider and an out-of-network provider that allows the latter to be reimbursed at in-network rates for the duration of your treatment.
SCAs are most commonly used when no substantial or adequate in-network options exist, or when a provider or facility is clinically indicated and can’t be easily replaced.
A request for an SCA can come from you, your treatment provider, or both of you. And it will need to demonstrate that the provider is qualified to deliver the required care and that in-network alternatives are unavailable or can’t meet your needs.
SCA requests can be made stronger with documentation showing:
Insurance companies aren’t legally required to grant you an SCA, but they are approved regularly across the country when your case is well-supported and in-network alternatives are limited.
Residential mental health treatment coverage is usually more complicated than outpatient services, so it’s good to be prepared. Most insurers classify inpatient treatment as a higher level of care, applying stricter medical necessity criteria before approving it.
Prior authorization is almost always required, with coverage decisions being made on a case-by-case basis.
Insurance providers generally want to see evidence that lower levels of care have not met your needs and that a clinical assessment supports your need for 24-hour structured treatment. They will also want to know that the admitting facility is licensed and accredited, and that your treatment plan is evidence-based and goal-oriented.
If your preferred residential facility is out-of-network, then you might need to pay upfront and submit claims for mental health reimbursement afterward, though your provider will likely help you do so.
The reimbursement rate depends on your plan’s usual and customary rates for residential treatment, how much of your deductible has been met, and whether prior authorization was obtained before admission.
Even after your admission has been approved, insurance providers typically conduct a stay review, or a periodic reassessment, to determine that your treatment continues to be necessary. Your treatment team will usually handle these, submitting updated documentation to justify your care.
Figuring out your insurance coverage doesn’t have to be a full-time job. AMFM Mental Health Treatment accepts insurance and is in-network with many major insurance providers.
If you need to use out-of-network benefits, we can help you find out what you’re looking at financially and all your potential paths, including single case agreements and any necessary paperwork.
At AMFM (A Mission For Michael) Mental Health Treatment, we handle your insurance verification directly and confidentially. We’ll check your benefits, clarify what’s covered, and walk you through your options so you can make informed treatment decisions.
If you’d like to check your coverage online, simply complete our confidential verification form. You can also call us at 866-478-4383.
Our expert clinical team believes in personalized treatment approaches for each individual to ensure our care provides you with long-term healing.
Start the admissions process online or reach out to us to get started – a helping hand is just one step away.
100% Confidential
No Commitment
Instant Results
If you’re considering using an out-of-network provider, it’s natural to feel confused about the process. To help, we’ve provided the following answers to questions about insurance we’re commonly asked.
No, negotiating a single case agreement won’t penalize your future benefits or raise your premium payments. It’s a standard industry arrangement, and entering into one doesn’t set a precedent that requires your provider to approve requests in the future, either.
They might, with your human resources department possibly being able to advocate on your behalf or escalate the issue with the plan administrator.
Employer-sponsored plans are overseen by the Department of Labor, which you can also contact directly if you believe your plan has violated national mental health parity laws.
It truly depends on the urgency of the situation. A standard appeal usually takes a month or two, but situations involving immediate risk or danger can be decided in three days.
Any external reviews usually add additional time, though most states have set their own deadlines for how quickly a reviewer is required to respond.
At AMFM, we strive to provide the most up-to-date and accurate medical information based on current best practices, evolving information, and our team’s approach to care. Our aim is that our readers can make informed decisions about their healthcare.
Our reviewers are credentialed medical providers specializing and practicing behavioral healthcare. We follow strict guidelines when fact-checking information and only use credible sources when citing statistics and medical information. Look for the medically reviewed badge on our articles for the most up-to-date and accurate information.
If you feel that any of our content is inaccurate or out of date, please let us know at info@amfmhealthcare.com
