The hidden differences between billing insurance and private pay therapy

If you're considering therapy and trying to figure out how to pay for it, here is what you need to know about the difference between using insurance and paying privately, and what each one means for your treatment.

Insurance Handles Therapy Like A Medical Condition

When a therapist bills insurance, a few things happen behind the scenes that are worth understanding before you decide how you want to pay for treatment.

First, your therapist is required to give you a diagnosable mental health condition from the DSM, the diagnostic manual used across the field, in order to justify treatment to your insurance company. Insurance covers mental health care when it's deemed medically necessary, and medical necessity requires a diagnosis. If you're coming to therapy because you're going through a difficult transition, feeling disconnected in your relationships, or just trying to understand yourself better, a diagnosis still has to be assigned in order for your sessions to be covered.

Second, that diagnosis becomes part of your permanent medical record. Depending on your situation, this can have implications down the road, including for certain types of employment, security clearances, and life insurance applications. It's not a reason to avoid getting help, but it's something worth knowing before you begin.

Third, insurance companies require therapists to submit documentation to justify continued treatment. That documentation includes clinical notes that speak to the content of your sessions, your symptoms, your progress, and the medical justification for ongoing care. An employee at your insurance company reviews that information to determine whether your treatment will continue to be covered. At Denver Therapy Collective we do our best to be thoughtful and protective in how we write notes and what we include. But the reality is that some of what happens in the room does leave the room, and you have less control over that than most people realize going in.

Fourth, insurance companies can restrict the length and frequency of your sessions, which can lead to shorter sessions that don’t adequately address someone’s symptoms or match the pace of treatment they’re looking for.

We want to be clear that working within the insurance system is something we do because we believe access to care matters. For a lot of people, insurance is what makes therapy possible at all. However, these are the realities of the system, and we think you deserve to understand them fully rather than discover them later.

Private Pay Therapy Provides More Treatment Options

When you pay out of pocket, the dynamic shifts in a few ways. You don't need a diagnosis to begin treatment. If you're coming to therapy because something feels off, or because a relationship in your life is struggling and you want to address it. We don't have to fit your experience into a diagnostic category to justify our time. Your records stay at Denver Therapy Collective. Outside of the standard legal and ethical exceptions that all therapists are bound by, what you share in session stays in session. No insurance reviewer or outside party weighs in on whether your care is medically necessary. The confidentiality that most people assume therapy already has is actually much closer to the truth with private pay.

There's also a clinical freedom that comes with this model that is easy to underestimate. Treatment doesn't have to be justified to a third party on a regular basis, so we can follow the thread of your experience more organically rather than organizing our work around symptom reduction and diagnostic criteria. When you have all the information, the flaws in our medical system can be seen more clearly. Private pay is more confidential and allows for more client autonomy, but is often more expensive than using insurance.

How We Protect Your Confidentiality Regardless of Billing

Protecting your confidentiality is something we take seriously, but it is different depending on how you pay. Our clinicians are trained to write notes with discretion. We think carefully about what needs to be documented and what doesn't. We follow all HIPAA guidelines and stay current on best practices for record-keeping and privacy. When working within the insurance system, we are mindful of the fact that documentation gets reviewed externally, and we write accordingly. We include what is clinically necessary and we are protective of the details that don't need to be there. It's an imperfect system, but we do everything within our power to handle your information with the same care we'd want someone to handle ours.

The Reality of It All

For some people, using insurance is the only realistic path to consistent care, and we're glad to be able to offer that. For others, the privacy and flexibility of private pay is worth the out of pocket cost, especially if the issues they're bringing to therapy are ones they'd rather keep off their medical record entirely.

Got More Questions?

Reach out to use using our contact form, email us at info@denvertherapycollective.org, or call and text 720-446-6363.