What Your Therapist Wishes You Knew About Insurance (Part 3 of 4): Why You Might Get a Surprise Bill — Even With Insurance
This is Part 3 of a 4-part series on using insurance for therapy.
Part 2: In-Network vs Out-of-Network — What's the Difference?
Part 3: Why You Might Get a Surprise Bill — Even With Insurance (you are here)
Part 4: When Insurance Isn't an Option — Other Ways to Make Therapy Work (coming soon)
This is the part of the series I wish I didn't need to write but this is really important.
One of the most common and most frustrating experiences clients have is doing everything right. They’ve called to verify their benefits, they’ve chosen an in-network therapist, they’ve gotten pre-authorization (if necessary) and then they still receive an unexpected bill weeks or months later. This happens more often than it should, and it is almost never the client's fault.
Here are the most common reasons it happens, and what you can do to protect yourself.
Your benefits change mid-treatment
Insurance plans can change their mental health benefits at any time, but typically do so at renewal, mid-year, or when your employer updates coverage. A plan that covered 20 sessions per year when you started therapy in January may only cover 10 by the time your renewal kicks in. Deductibles reset, copays increase, and coverage tiers shift. Unfortunately, your therapist doesn't always receive notice when this happens, and neither do you, until a claim gets processed differently than expected. Insurance companies should inform you of policy changes in writing, and they may do so by paper mail, email, or through your insurance portal.
What to do: Re-verify your benefits at the start of every new plan year, and any time you receive a notice that your employer is changing its health coverage. Don't assume that because your plan covered something last month it will cover the same thing next month.
The Information You Were Given Was Wrong
When you call your insurance company to verify benefits, you're talking to a customer service representative who is reading from your plan summary. What they tell you is not a guarantee of payment but is an estimate based on the information available at that moment.
Insurance companies include disclaimers in almost every verification call: benefits are "subject to change" and actual coverage is "determined at the time the claim is processed."
Here’s an example of what this could look like: you call your insurance company and make your way through the menu options to be able to speak to a representative. They give you the information they can see, and tell you your therapy sessions are covered at 80% after your deductible. So you start treatment in good faith, and then three months later you receive an Explanation of Benefits showing a completely different rate or an outright denial. When you call to dispute it, you'll be told that verbal benefit verifications are not binding.
It is an infuriating reality of the system, and it catches a lot of people off guard.
Your therapist has the ability to check an insurance database to view your policy information. But my experience has been that the information available to me is sometimes out of date or incorrect, and we don’t know that until we’ve submitted your first claim. It’s the insurance companies’ job to keep that information up to date for processing claims for your medical care, so it can be incredibly frustrating to get incorrect information from them.
What to do: Whenever possible, ask your insurer to send a benefit summary in writing through their member portal rather than relying solely on a phone verification. Keep a record of every call you make and include the date, the representative's name or ID number, and exactly what you were told.
A Claim Was Reversed After It Was Already Approved
Insurance companies have the ability to retroactively review and reverse claims they've already paid. This can happen if an auditor determines that a session wasn't "medically necessary" by their internal standards, if there's a discrepancy in billing codes, or if your coverage is found to have lapsed at the time of service for any reason, including administrative errors on the insurer's end.
When a reversal happens, the insurer takes back money they've already paid your therapist, who then has to decide whether to bill you for the balance. So you can see a bill arrive for sessions that happened months (or even years!) ago, which is disorienting and stressful.
Texas law prohibits clawbacks further than 180 days from payment, though many policies will have workarounds to that limit, creating even more frustration for clients and providers. Federal funders (Medicare, Medicaid, TRICARE) have no time limit. That means your therapist could get a clawback from several years prior.
Some therapists will contact you about the situation and ask for your payment. Other therapists decide to eat the loss to save client stress. But either way, a clawback is money that your therapist lost even though they did quality work, and there’s often very few options for dispute.
What to do: If you receive a bill for past sessions that you believed were covered, don't assume it's correct and don't pay it immediately. Contact your therapist's office first to understand what happened, then contact your insurer to request a detailed explanation. You have the right to appeal denied or reversed claims and your therapist can often provide supporting clinical documentation to help with that process. And you as the policy holder will likely have better luck with the dispute process than the medical provider who filed the claim for you.
You Haven't Met Your Deductible Yet
This one is less of a billing error and more of a common misunderstanding but it causes real financial surprises, so it's worth naming clearly.
Many clients assume that having insurance means their sessions are covered from the first appointment. In reality, most plans require you to meet an annual deductible (sometimes $500, sometimes $1,000, sometimes $3,000 or more) before insurance begins paying its share. Until you've hit that threshold, you are responsible for the full session fee, even if you're seeing an in-network therapist. Additionally. many policies have different deductibles for medical care versus mental health care, so clients need to verify which deductible claims will fall under.
If your deductible resets on January 1st and you attend weekly sessions, you could be paying the full rate for the first month or two of the new year before your benefits kick in. For clients on high-deductible health plans, this can mean paying out of pocket for a significant portion of the year.
What to do: Before starting therapy, ask your insurer what your current deductible balance is and how much you've already met for the year. This one piece of information will tell you a lot about what your first few months of therapy will actually cost.
A Summary: Some Ways to Protect Yourself
Re-verify your benefits every plan year and don't assume last year's coverage applies
Get benefit information in writing when possible, through your insurer's member portal
Keep records of every call to your insurer including the date, representative name, and what was said
Know your deductible and how much you've met before your first session
Review every Explanation of Benefits (EOB) your insurer sends and don't assume a bill is correct just because it arrived
Don't pay a surprise bill without asking questions first start by contacting your therapist's office and your insurer before assuming you owe what's being charged
Know that you can appeal if a claim is denied or reversed, you have the right to dispute it, and your therapist can often help
None of this is meant to make the process feel more overwhelming than it already is. It's meant to help you go in with realistic expectations so that if something does go sideways, you'll know what to do.
In Part 4, I'll cover what to do when insurance isn't a workable option at all including sliding scale fees, superbills, and how to have the money conversation with your therapist without it being awkward.
Questions? Let's Talk.
If you've received a confusing bill or have questions about how insurance works at Mindful Kindness Counseling, please reach out. These conversations are always welcome.
Request a free 15-minute consultation call →
Bonnie Scott is a Licensed Professional Counselor-Supervisor (LPC-S) in San Antonio, TX. She offers individual therapy, couples counseling, and LGBTQ+ affirming care in person and via telehealth throughout Texas.
