How You Can Avoid Common Costly Mental Health Billing Errors

How You Can Avoid Common Costly Mental Health Billing Errors


For mental health practitioners, navigating insurance claims and billing issues is an unfortunate reality of the job. 

Unlike large medical facilities, where entire departments are trained to research, submit, and follow up on claims and billing, you’re probably “winging it” with little to no real understanding of how the system works. The potential for costly mistakes is high.

At ClinicMind, we understand the industry and the most common mental health billing issues that practices have to tackle. Based on our team’s expertise, we’ve outlined what they are and how you can resolve them.



How to Solve the 4 Most Common Mental Health Billing Issues

Author: Kathleen Casbarro

  • Insurers Deny “Duplicate” Billing

  • DSM-5 and ICD-10 Code Discrepancies

  • Providers Receive Partial Payments

  • Providers Don’t Know Patients Are Out-of-Network

One of the most common mental health billing challenges stems from the disconnect between how mental health providers and health insurance companies view basic services.

Insurers Deny “Duplicate” Claims

Payers view mental health services differently than providers do. When a mental health provider does a diagnostic assessment, it’s intended to learn more about the patient, their history, and anything else that will help create the best treatment plan. 

Insurance companies, on the other hand, don’t consider a diagnostic assessment any different from a standard office visit. 

So, when your office submits claims for both a diagnostic assessment and an office visit on the same day, the payer usually declines one of those claims. In their eyes, you’ve submitted two office visits in one day. 

This is one of the biggest claims issues we handle for our clients and the solution is pretty simple – bill for the diagnostic assessment on one day and the office visit the following day. You’re more likely to have both claims approved and paid.

DSM-5 and ICD-10 Code Discrepancies

Another common mental health billing issue pertains to coding discrepancies. Most mental health professionals diagnose patients using the DSM (Diagnostic and Statistical Manual of Mental Disorders), while most insurers reference ICD codes. 

Unfortunately, these two coding manuals don’t always match one-for-one. 

ICD-10 codes are updated every 10 years through a committee-based process. That means there can be a significant gap in time between DSM-5 code changes and the creation of correlating ICD-10 codes.

For example, in the DSM-5, a recent diagnostic change was made to include DMDD (Disruptive Mood Dysregulation Disorder) because a number of children were being diagnosed with bipolar disorder and then seemed to grow out of it. 

The problem is, you don’t outgrow bipolar disorder, so there was need for a more accurate diagnosis. Once clinicians determined those children were actually dealing with a distinct disorder separate from bipolar disorder, they distinguished the DMDD diagnosis and a corresponding code. 

The same lag in coding applies to autism spectrum disorder, which is constantly being updated with new, related diagnoses, due to neurodiversity research. 

Because the governing bodies for DSM-5 and ICD-10 are separate, there is no clean solution to this issue. At ClinicMind, we use state-specific Department of Human Services resources to best identify how the DCM-5 correlates to the ICD-10 codebook on a case-by-case basis. Providers who are handling their own claims submissions either have to navigate those resources themselves or work with a billing consultant that does.

Providers Receive Partial Payments

Despite all the advances made in identifying and treating mental health disorders, insurance companies can use somewhat outdated thinking when it comes to claims. Sometimes insurers just won’t pay for diagnostic assessments or other activities like talking to patients and their families about medical management. 

Regardless of whether providers make use of the mental health-specific add-on codes meant to account for additional time, insurance companies still deny many of those claims. (This is really a symptom of a bigger problem within the industry.)

As a result, providers have to prepare medical documentation and written justification for the extra time spent with patients – which actually takes them away from patient care – only to have the claim denied anyway. Many mental health practices end up increasing their rates just to make up for the denials, a tactic that doesn’t serve the practice or the patients.

The real solution is to either dedicate an internal billing team to handle claims or outsource to a mental health billing solution provider that will fight to get every claim approved. 

Providers Don’t Know Patients Are Out-of-Network

With all the insurance mergers and acquisitions, it can be difficult to determine whether patients are in-network before their intake. 

For example, most providers don’t know the parent company for Aetna and Meridan Health is PreferredOne. So, unless a provider has been credentialed with PreferredOne, they won’t be considered in-network for Aetna or Meridan Health insurance plans.

Finding this out only after a claim has been submitted delays payment and belabors your staff. Without this type of industry knowledge and a dedicated team to handle insurance verification, mental health providers may be playing Russian roulette when submitting claims.

Of course, the obvious solution is to verify insurance before ever seeing a patient to determine if they are in-network. However, in the mental health care world, where patients contact your office with acute situations to be addressed, that may not be realistic when you have a limited staff. 

This is just one of many reasons why providers benefit from working with an outsourced mental health billing solution.

Learn More About Our Billing Solutions Now


How ClinicMind Helps Customers With Mental Health Billing 

There are a number of reasons why working with an total EHR, RCM, and consulting solution like ClinicMind makes sense.

Manual Insurance Verification 

When providers can lean on a dedicated resource to check each patient’s insurance and verify benefits, it doesn’t just free up staff time – it also gives mental health providers the information they need to put patients on the best treatment path. 

Before the first interaction with a patient, they know:

  • What services are covered under benefits
  • What the patient’s deductible is and how close they are to meeting it
  • What their copay is for in-person versus telehealth visits and which make the most sense

With this information, mental health providers can recommend the right type of services for each patient so they can receive the treatment they need. Providers get the peace of mind that their patients are covered in network and patients know up front what their out-of-pocket costs will be.

Billing Coach to Solve Claims Issues

At ClinicMind, we schedule regular coaching calls with our clients to work through their toughest billing and claims issues. We even help practices solve operational problems, either by recommending one of our software solutions, offering our consulting services, or making a referral to a partner who can help resolve the issue. 

Pre-Scrubbed Claims

Mental health practices that use our EHR/RCM software get an end-to-end solution to pre-scrubs claims, increasing the likelihood they will be paid quickly. Our solution applies practice-specific validations based on CPT diagnoses combinations that need to be flagged and reviewed before being submitted to make sure those claims have the best chance of being approved and paid as well.

Useful Documentation and Reporting

Our system features proprietary FlexNotes™ with customizable macros that relate directly to ICD-10 and CPT codes. When providers take clinical notes, they are prompted to use coding language so claims are more likely to be approved and paid. 

Robust reporting, such as the payer allowed amount report, lets providers see contract rates to make sure claims are billed for the right amount and have the best chance of being approved.

At ClinicMind, we know that mental health providers just want to focus on helping patients. The more time you spend on endless paperwork and handling claims issues, the less time you have to do what matters most.

Schedule a consultation today to find out how we can help resolve your biggest billing issues. 


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