Insurance companies generally pay a fee that is "usual and customary" for the type of treatment you are receiving and for the type of provider who is treating you. If your therapist charges $110.00 for a service that is reimbursed by your insurance company at $90.00, the insurance company will only pay $90.00 (the allowable charge) less your deductible and co-payment for that service. Depending on the relationship your therapist has with your insurance company (contracted as a Panel Provider or not), you may be responsible for your co-payment plus any additional charge. It is important to know what your therapist charges and how this charge will be reimbursed. Both therapist and insurance company should be able to provide you with additional details.

A benefit period is just as it sounds -- the period in which you have a certain benefit. This can be tricky, however, depending on how your insurance company computes the period. It may be that your benefit period renews on a particular date each year, or it may be that it renews after a certain amount of time passes from the first use of your benefit. This can be cumbersome to calculate along with deductibles and co-payments, so it is best to ask your insurance company for clarification

Billing codes, known often as “CPT codes” are used to indicate what services occurred and how long the service lasted. It is an integral part of claims payment, and each service has it's own code or number. These codes change from time to time and your therapist or the billing office he/she uses will likely be well aware of these changes as they occur. Additionally, there also may be restrictions on the type of billing codes that can be used. Some insurance companies exclude certain types of services, and therefore certain types of codes. If your therapist is a Panel Provider, they will most likely be aware of what codes to use in order to make a clean claim against your benefit. If not, difficulties can arise including denial of payment from your insurance company. It is ok to ask your therapist about his or her billing practice and to know how things will be paid.

A clean claim references a billing form sent into your insurance company that meets all of the requirements of that company. Typically, the billing form must list your demographic information -- including your social security number, your date of birth, your address and your employer name -- the diagnosis code for the disorder being treated, the appropriate billing code with it's associated charge, and demographic information about your therapist including where and when the treatment occurred. Claims can be denied for payment if any of this information is missing. It is likely that your therapist or his/her billing office knows what to include on a claims form to make it “clean.”

A co-payment is your portion of a covered charge. Often this is a percentage of the charge but sometimes it is a set amount. For example, if your co-payment is 20% and the allowable charge is $90.00, you would be expected to pay $18.00; conversely, if your co-payment is $10.00 and the allowable charge is $90.00, you would only be responsible $10.00. This may seem elementary, but it can be tricky depending on the allowable charge and whether or not your therapist is contracted with your insurance company. As always, be sure clarify your co-payment (if any) with your insurance company and be knowledgeable about your benefit.

A deductible is a fixed amount of money that you have to pay before your insurance company starts paying for claims. This is jointly set by your insurance company and, if you are employed, by your employer. Almost all services rendered -- whether you see your primary care physician, another medical specialist, or a mental health provider -- count toward your deductible. As always, clarify this amount -- and how it applies to your deductible -- with your insurance company.

A diagnosis code is a code referencing a particular disorder listed in the Diagnostic and Statistical Manual of Mental Disorders (current volume IV TR). The codes are derived from the a standardized list of possible disorders in a book known as the ICD-9. Diagnosis codes are typically required by insurance companies to pay for any sort of mental health treatment.

An explanation of benefit is generally a description of the policy you or your employer has purchased, a summary of what charges are covered, and an account of what charges are not covered. For example, your policy may cover a 24 month period and you may have a certain number of sessions available for use during this period. You may have to see a provider on a specific panel in order to get the most monetary benefit from your insurance plan. Additionally, you may have to pay a deductible or co-payment before your insurance company pays for services.

Insurance companies typically pay for services that are considered "medically necessary." In broad, general terms this means that your treatment must match written guidelines and/or treatment protocols for reimbursement to occur. Many insurance companies have utilization review departments that establish their own guidelines and they are likely available for you to review before, during or after your treatment.

Mental Health Parity laws were enacted by congress to ensure more equalized payment of benefit for covered mental health conditions. In the past, insurance companies may have provided you with a benefit of a certain dollar amount -- therefore, if you saw a therapist who charged less or if you had 1/2 hour sessions or something similar, you could "extend" your benefit. With the current legislation, benefits are most often quoted per session, e.g., 10 sessions per year, 20 sessions per year, and so on. This means that regardless of the billing code or cost of treatment, 1 session billed equals 1 session paid. It doesn't matter if the session last 30 minutes, 60 minutes, or if it is group or individual treatment.

In general, a panel provider is a professional person or agency that has a contract with your insurance company. His or her fee may be reduced to some extent or he or she may have agreed to contractual limits of reimbursement for treatment that you receive. Most often, the contracted provider is the least expensive option for you as the consumer and generally, contracted providers have to hold you harmless for any charge denied by your insurance company. As this may not be the case, the place to get answers about panel providers is though your insurance company. And a frank discussion of finances and payment would likely be welcome by your provider, though there may be some restrictions about what he or she can disclose.

Many insurance plans offer a point of service benefit, which essentially means that you may see a non-contracted provider, though your co-payment may be a bit more. For example, you may have to pay a 20% co-payment to see someone contracted by your insurance company and 30% to see someone who is not. In general, though, language such as "medical necessity" and "deductible" still apply -- and when your therapist is not contracted with your insurance company, you may be responsible for any charge denied by them for reimbursement.