Insurance Billing for Therapists: What You Need to Know
By Kristen McClure, MSW, LCSW | TherapistWorksheet.com
Insurance billing is one of the most practically important and least taught skills in clinical training. Most therapists learn it by trial and error — or outsource it immediately. This guide gives you the baseline knowledge you need to bill correctly, understand your reimbursement, and avoid the mistakes that trigger audits or claim denials.
The Basics: How Insurance Billing Works for Therapists
The claim cycle
- Client has insurance; you are paneled (in-network) with that insurer
- You provide service and document appropriately
- You submit a claim (via your EHR or clearinghouse) within the filing deadline
- The insurer processes the claim and pays based on your contracted rate
- You collect the client’s copay, coinsurance, or deductible
CPT codes for therapy
The codes you will use most frequently:
- 90837 — 60-minute individual psychotherapy (the most common)
- 90834 — 45-minute individual psychotherapy
- 90832 — 30-minute individual psychotherapy
- 90847 — family/couples therapy with patient present
- 90846 — family therapy without patient present
- 90791 — psychiatric diagnostic evaluation (initial assessment)
Add-on codes (90785 for interactive complexity, 90833/90836/90838 for E&M + therapy) exist but require specific documentation to support. Know the requirements before using them.
The superbill
If you are out-of-network, clients may request a superbill — a detailed receipt with all required billing information that they submit to their insurance for reimbursement. Include: your NPI, tax ID, service dates, CPT and ICD-10 codes, charges, and your signature. Your EHR should generate these.
Getting Paneled with Insurance
Credentialing — the process of becoming an in-network provider — takes 60-120 days or longer with most insurers. Start the process well before you intend to see insurance clients. Requirements typically include: license, malpractice insurance, NPI number, CAQH profile, and state-specific forms.
CAQH (Council for Affordable Quality Healthcare) is a centralized credentialing database — most insurers require a complete, current CAQH profile. Create and maintain yours early.
Medical Necessity and Authorization
Insurance covers therapy that is medically necessary — meaning there is a diagnosable condition that therapy is treating. Your documentation must support medical necessity: a DSM-5 diagnosis, symptoms that impair functioning, treatment goals tied to those symptoms, and ongoing progress toward those goals.
Some insurers require prior authorization for ongoing therapy beyond a set number of sessions. Know your payer contracts. Missing authorization requirements results in denied claims.
Common Billing Errors That Get Claims Denied
- Wrong CPT code for session length
- Billing a 90837 for sessions that were actually shorter
- Missing or invalid NPI
- Billing past the filing deadline (usually 90-365 days; check each contract)
- Diagnosis code that doesn’t match documentation
- Billing for services not covered by the plan
- Failing to collect copays (most payers require this; waiving copays routinely is a compliance issue)
Should You Outsource Billing?
Many therapists outsource billing to a medical billing service or virtual biller, particularly when working with multiple payers. Cost: typically 5-10% of collections, or a flat monthly fee. The tradeoff: less direct control but significant administrative time savings. Evaluate at your caseload size — outsourcing at 5 insurance clients may not pay; at 25 it often does.
Frequently Asked Questions
Can I see insurance clients and private pay clients in the same practice?
Yes. Many therapists have a mixed practice. Be clear in your informed consent about which clients are being seen at which rate and under what arrangement.
What is the No Surprises Act and does it apply to me?
The No Surprises Act requires providers to give uninsured and self-pay clients a Good Faith Estimate of anticipated costs. It applies to most healthcare providers including therapists seeing self-pay clients. Check current CMS guidance for compliance requirements.
Can I charge a different rate to insurance clients vs. self-pay?
When in-network, you must accept the contracted rate as payment in full. You cannot charge in-network clients your full fee on top of the insurance reimbursement. When out-of-network, you set your rate — clients may submit to insurance for partial reimbursement.
What do I do when a claim is denied?
Read the denial reason carefully. Most denials are correctable — wrong code, missing information, authorization issue. Submit a corrected claim or appeal within the denial timeline. Persistent, systemic denials warrant a conversation with your payer representative.
Kristen McClure, MSW, LCSW is a licensed therapist who creates practical clinical tools to help therapists navigate the hardest moments in their work.