Why Is Therapy So Expensive?!?: And 3 Practical Solutions

Why is therapy so expensive?

The average cost of a therapy session is between $100 to $200. When you use health insurance, your copay is around $21 in network and $60 out of network  (Source: Bankrate). If you are having weekly or biweekly sessions, these costs add up to thousands of dollars per year. When I looked for a therapist out-of-network or cash pay in my area (Washington, DC), I could not find a single clinician for less than $200 per session. Even as a clinician it begs the question, why is therapy so expensive?

Insurance Companies

Unfortunately, insurance companies have one of the lowest reimbursement rates when it comes to mental healthcare when compared to medical healthcare. Based on my personal experience, the highest reimbursement rate I have received was $75 for 50 minute sessions from BlueCross BlueShield. I have also witnessed reimbursement rates as low as $20 an hour. 

It can take 90 days or longer for your provider to be reimbursed for services by the insurance company. In addition, the insurance approval process is lengthy and arduous. There are entire businesses dedicated to helping providers become accredited by insurance companies. Insurance companies also require detailed notes to reimburse for services. This causes extra time, stress, and mental load from your provider. I often found myself in conflict with insurance companies months after a session to collect reimbursement.These are some of the reasons some clinicians do not take insurance. 

Insurance companies are in the business of making money, therefore, providing a weekly reimbursement for treatment that could potentially be a years long process, could negatively impact their bottom line. They are functioning in the way that they were intended to.

Training/Education

Therapists spend at least 2 years at the master’s level and range between 5 to 8 years at the doctoral level in graduate school. Next, they complete thousands of hours of supervised sessions at either no pay or a lower rate until they are fully licensed. (My licensure required a total of 3,500 supervised hours.) Once they receive their licensure they must complete continuing education units or “CEU”s that are costly. I am required to complete 40 CEU’s every 2 years to renew my license. Once you consider licensure costs, education, and training it can add up to hundreds of thousands. Generally the more time/requirements a profession requires, the higher the salary.

The Expense…it’s not just about money

Like all businesses, there are general operational costs (such as space, equipment, materials etc.) and fees specific for healthcare providers (insurance, encrypted software, etc.).  

There are also hidden costs that are not nominal, for example, mental load!. We provide a service that requires a level of emotional labor that cannot be quantified. While providers could take more clients at a lower rate, it could lead to burnout significantly impacting the quality of their work. 

What can you do?

1. Lobbying insurance companies: as consumers and providers we must demand that insurance companies pay mental health providers what they are worth. We must force them to value mental healthcare by paying comparable reimbursement rates. 

2. Ask for a single case agreement: I admit this is a long shot. However, sometimes insurance companies will sign what is called a “single case agreement” to reimburse in full (or close to it) the provider for their services. Check with your insurance provider to ask if this is possible.

3. Ask your provider for a sliding scale: While this does put the onus on the provider to lower their rate (which ultimately reinforces the insurance companies to not pay providers their worth) it is a more immediate fix. When you reach out to a therapist, ask if they offer a sliding scale. A “sliding scale” is a therapist's way of saying discounted rates. Many therapists maintain a specific number of sessions per week at a sliding scale. 

Last Note

If you find yourself asking why can’t the providers just lower their rate? Consider this: I had a 15 minute consultation with my OBGYN that was $320 and my insurance provider covered most of the cost (no comparison on work level here). Generally, we do not ask medical providers to simply “lower the rate” because their work is already placed at a high value both nominally and conceptually. Through research and lived experiences, we know that mental and physical healthcare are of equal importance, yet they are not treated as such. As a community, if we are saying (especially since the pandemic)  that mental and medical healthcare are of equal importance, then offer reimbursement rates that match the sentiment. 

Lastly, multiple things can all be true: we can truly love what we do, care deeply about our clients, and desire to be paid our worth for the services we provide.