Does My Health Insurance Cover Therapy?

The National Institute of Mental Health estimates that over 44 million American adults suffer one form of mental illness or another. In the past, insurance companies were not required to offer mental health coverage at the same level as physical health benefits, if they covered it at all. However, there have been recent changes to laws that are making insurance benefits for therapy and counseling with a therapist in Palatine, IL more comprehensive.

The Affordable Care Act

The Affordable Care Act (ACA), enacted in March of 2010, requires most employer and private insurance plans and all ACA Marketplace plans to cover mental health and substance abuse services at the same level as physical health. Deductibles, co-payments, co-insurance, treatment limits and out-of-pocket maximums must be the equal, as well as prescription medication benefits. These insurance companies also may not deny coverage because of a pre-existing mental illness.

Medicare and Medicaid

Medicare and Medicaid are federal and state health benefits programs for seniors 65 and older, disabled and low-income Americans. The extent of coverage often varies widely by state, but you can usually get some help with therapy or counseling.


Medicare Part A offers assistance with mental health services after admission to a hospital for psychiatric or general treatment. Part B provides an annual mental health wellness visit and depression screening by your primary care physician, as well as psychiatric evaluation and various therapies directly related to your treatment depending on your state. The majority of prescriptions that treat depression are covered by Part D, as well as limited benefits for other mental health medications.


Although the coverage levels vary from state to state, all Medicaid programs have some mental and substance abuse benefits, and children often have more coverage through the CHIP program

What This Means for You

Doctors, counselors and therapies that generally fall under the mental health umbrella include:

  • Psychiatrists
  • Psychologists
  • Licensed Mental Health Counselors (LMHC)
  • Licensed Clinical Social Workers (LCSW)
  • In-patient psychiatric hospitalizations
  • Out-patient group therapies

Still, it is important to note that mental health coverage is not universal. Employers with 50 or fewer employees are exempt from the laws requiring them to offer equal benefits for mental health. Plans purchased outside of the ACA Marketplace are required to offer benefits, but there are no provisions for the levels or types of coverage. What’s more, some insurance plans don’t have to cover mental health at all.

Knowing your level of coverage before seeking help can help prevent sticker shock when the bill arrives in the mail. If you’re unsure about how your health insurance will help pay for therapy or substance abuse counseling, contact your employer’s human resources department or call your insurance provider directly.

Thanks to Lotus Wellness Center for their insight into counseling and health insurance coverage.