Mental health pay rates vary widely across the US

The pandemic has brought mental health to the forefront of the national conversation. Just last fall, a coalition of leading pediatricians, psychiatrists and children’s hospitals issued a national statement declaring a state of emergency in child and adolescent mental health.

A national mental health provider shortage is exacerbating this problem, as well as the fact that many providers are no longer enrolling in health insurance plans making them inaccessible to cash-strapped families. Roughly half of all children rely on Medicaid or other state-subsidized health plans for coverage.

Mental health advocates and providers often cite abysmal reimbursement rates as a reason for going private. I wanted to know, how much were states actually paying for therapy. After combing through dozens of state-specific Medicaid provider fee schedules, I comprised a dataset of rates for the most commmonly billed outpatient therapy code: 90834, or 45 minutes of psychotherapy. The median rate was $82 per session, but that varied widely. Pennsyvania and Maine reimburse therapists the least—just $39 per session—and Alaska, Nebraska and Montana are paying more than $120.

States where the cost of living is the heighest weren't necessarily paying doctors more than the national median. In coastal states like Maine, New York, California and Washington, where the cost of living ranges from 16% to nearly 50% above the national median, Medicaid plans are reimbursing significantly below the median $82.

Barbara Kapetanakes, the president of the New York Psychological Association, says these rates are critical in a provider deciding whether or not to work with Medicaid. New York pays therapists $70 per 45-minute session, and Kapetanakes says the market rate is significantly higher where works. She says there is little incentive for therapists to take a pay cut in order to accept state health plans.

An analysis of NYC-area psychology today profiles suggests that therapists are charging more than double the state's Medicaid rate.

When working on my master's thesis about pediatric mental health care accessibility in New York, I kept hearing how health plans pay providers "abysmal" rates for mental health care. I wanted to know how New York stacked up with the rest of the country, so I combed through each state's Medicaid provider fee schedule looking for how much it pays for the most commonly billed therapy code: 90834. There were some nuances in comparing states. Some paid more to psychologists than other therapists, some had facility and non-facility rates. When given the option, I chose the psychologist rate and the non-facility rate, given I was mostly interested in what private providers could get from Medicaid. I was unable to find information for Rhode Island, Kansas and Tennessee as they did not make their fee schedules available online.