Understanding Insurance Benefits

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We understand that insurance isn’t always straightforward. Most of us were never taught how insurance works and end up having to figure it out on our own. Between unfamiliar terms, explanations of benefits, and unexpected balances, it can quickly feel overwhelming.

To help make things easier, we’ve put together a simple breakdown of how insurance generally works, along with explanations of common terms you may see or hear when using your benefits. Having a basic understanding can help you feel more informed and prepared when navigating your care.

Here’s a general overview of what that process typically looks like:

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You receive services
You attend your appointment as scheduled. At the time of service, we may collect a copay or co-insurance based on your insurance benefits.

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We submit a claim to your insurance
After your session, we send a claim to your insurance company with the required details so they can process it according to your plan.

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Insurance processes the claim
Your insurance determines how much they will cover based on factors like your deductible, copay, coinsurance, and whether the service is covered under your plan. It can take 2-8 weeks for a claim to be processed and paid.

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You receive an Explanation of Benefits (EOB)
Once the claim is processed, your insurance sends you an Explanation of Benefits. This is not a bill. It’s a breakdown showing what was billed, what insurance paid, and what portion is your responsibility.

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Final responsibility is determined
After insurance finishes processing the claim, they may apply adjustments based on your benefits. If there is a remaining portion they do not cover, that amount becomes your responsibility.

Because every insurance plan is different, costs can vary from person to person, even for the same service.

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Glossary of Terms – Insurance & Billing Terms

CPT Code
A CPT (Current Procedural Terminology) code tells your insurance company what kind of service you received – such as an intake session,  therapy session, or family counseling. CPT codes are reimbursed at different, contracted rates for every insurance carrier.

Common therapy CPT codes:

  • 90791: 55-minute intake session
  • 90837: 55-minute individual session
  • 90847: Family or relationship session (with client present)

Diagnosis Code (ICD-10 Code)

This is a code that tells insurance companies what condition or symptoms the therapist is treating. It’s required for insurance reimbursement and can determine whether or not insurance will pay for a certain service. Not all diagnosis codes are covered by insurance companies.

Commonly accepted diagnosis  codes:

  • F41.1: Generalized Anxiety Disorder
  • F32.1: Moderate Depression
  • F90.0: ADHD, Inattentive Type

Commonly denied codes (often not covered):

  • Z63.0: Relationship distress with spouse or partner
  • Z60.0: Social environment stressors
  • Z03.89: No diagnosis — just symptoms

We don’t believe your experiences should be reduced to a code, but we also want to help you understand what insurance requires.

Deductible

The amount you have to pay out-of-pocket for services before your insurance starts to pay.

Example: If your deductible is $1,000, you pay the full cost of therapy until you’ve paid $1,000 total for medical care that year. The actual cost of your sessions will depend on the contracted reimbursement rates set by your insurance carrier. We do not control or dictate these rates.

Coinsurance
After you meet your deductible, coinsurance is the percentage you still owe for services.

Example: If your insurance covers 80%, you pay the remaining 20%. The actual rate you pay for coinsurance will vary based on our contracted reimbursement rate with your insurance company.

Copay
A fixed fee you pay at each visit. This can be the same throughout the year or it can kick in once you’ve met your deductible. Copays range in amount from as low as $1 to as high as $100. Sometimes they change based on whether or not your session is in-person or via telehealth (and it’s not consistent that one is always more or less than the other).

Claim
A bill that your therapist (or billing team) sends to your insurance company after a session, asking them to pay for part or all of the cost. A claim must include very accurate and specific  information in order to be processed and paid by insurance companies, including a diagnosis, clinician credentials, and CPT code. Claims can take up to 8 weeks (sometimes longer) to be processed and paid, so if your insurance lapses or copay changes, we won’t know until several sessions have taken place and we receive an EOP from your insurance company.

EOB (Explanation of Benefits)
A document from your insurance company that explains what they were billed, what they paid, and what you may still owe. This sometimes looks like a bill but it isn’t one. It’s meant to help you understand your insurance plan and what it covers (and doesn’t cover).