Understanding Mental Health Insurance in Minnesota: MA, Medicare, PMAP vs Commercial
- Kaylee Bond, MA LPCC
- Jun 8
- 4 min read
Insurance is terrible and makes working in Mental Healthcare a nightmare
I'm hoping to provide a brief outline to break down the primary insurance types of mental health therapy in Minnesota. This guide breaks down Minnesota’s primary insurance types—Medical Assistance (MA), Medicare, PMAP, and commercial insurance—to help therapists better understand what they are undertaking.
Understanding Medical Assistance (MA)
Medical Assistance (MA) is Minnesota’s Medicaid program designed for low-income individuals and families. It provides extensive coverage for mental health therapy, including:
Outpatient therapy
Medication management
Inpatient care
This sets the general bar for rates in Minnesota at around 100-115 per session. Their rates are public and can be found on the DHS website.
Mental health therapists are generally limited in how many sessions they provide a year.
As of 2023, over 1 million Minnesotans rely on MA for their healthcare needs. To qualify, applicants must meet specific income and asset limits. For instance, a single adult may qualify if their monthly income is below $1,600, while a family of four must be under $3,200.
MA also emphasizes holistic care, covering services such as crisis intervention and supportive housing. This means that those in need can receive comprehensive support—like housing assistance for individuals facing mental health challenges—tailored to their unique situations.
Delving into Medicare
Medicare is a federal health insurance program primarily available to individuals aged 65 and older, but it also covers younger people with certain disabilities. For mental health therapy, Medicare provides extensive coverage including:
Outpatient mental health services
Inpatient psychiatric hospital stays
Partial hospitalization programs
Here’s a breakdown of Medicare:
Part A covers inpatient hospital stays, while
Part B focuses on outpatient care, including therapy sessions.
Part D offers prescription drug coverage, including medications for mental health conditions.
On average, Medicare beneficiaries pay a deductible of $1,556 for hospital stays and 20% of the costs for outpatient services after the deductible is met. Patients often find that while they have coverage, some costs can add up quickly.
Medicare pays super poorly and is a nightmare to get contracted with. There was a point in time where Medicare only was covered by the highest license in the field which was a doctoral level licensure for therapy. This changed recently and allows masters level clinicans to offer medicare. However, due to the low rates there is a still a number of clinicans who don't contract with medicare.
PMAP: Minnesota's Prepaid Medical Assistance Program
PMAP, or Prepaid Medical Assistance Program, is a variant of MA that serves specific low-income populations. It operates as a managed care option that focuses on coordinated and preventive care.
For mental health therapy, PMAP typically mirrors MA’s coverage but adds enhanced case management services. Enrollees often receive help from care coordinators who assist with navigating the mental health services available to them. For example, an individual may receive consistent follow-up and referrals to mental health specialists, ensuring their care is both comprehensive and continuous.
A study revealed that PMAP enrollees have shown a 25% reduction in emergency room visits related to mental health issues, highlighting the program's effectiveness in preventative care and ongoing management.
Commercial Insurance: A Broader Perspective
Commercial insurance comes from private companies and usually offers a variety of plans, such as employer-provided insurance and individual market options. Coverage for mental health therapy can significantly differ based on the chosen plan.
Most commercial insurance plans are governed by the Mental Health Parity and Addiction Equity Act (MHPAEA). This law requires mental health services to be covered equally to other medical services regarding costs and services. For example, if a patient has a $20 copay for a doctor visit, their therapy session copay should be similar.
However, affordability is a key consideration. Deductibles can vary widely; some plans may have low premiums but high deductibles, while others might be the opposite. It is essential to thoroughly review your specific plan's mental health benefits before starting therapy.
Commercial insurance typically pays the best. It makes the start of the year hard though as many deductibles reset and it can reduce income for the first quarter. Deductibles, copays, and coinsurance are another variable to therapy finances that I will cover in a different blog.
Comparing the Options
Choosing between MA, Medicare, PMAP, and commercial insurance for mental health therapy involves evaluating multiple factors:
Eligibility: MA and PMAP focus on low-income individuals; Medicare serves adults 65 and older and those with disabilities. Commercial insurance is available based on employment and income.. Although medicare is the lowest paying and harder to get services because less people are contracted.
Coverage: While all options provide mental health coverage, specifics can differ. MA and PMAP often provide easier access to care for eligible individuals, while commercial plans might offer a wider network of facilities and specialists.
Cost: For many, cost is a significant factor. MA and PMAP typically offer low or no-cost services, while Medicare may involve deductibles. Commercial insurance costs can range dramatically based on the selected plan, making it essential to choose wisely.
Ultimately, reviewing your situation—like income, mental health needs, and treatment preferences—will help lead you to the best insurance type for your therapy and support requirements.
Navigating Your Choices
Understanding the various insurance types available for mental health therapy in Minnesota—MA, Medicare, PMAP, and commercial—is essential for making informed choices. Each option offers unique benefits and coverage differences, but the ultimate goal is similar: ensuring that individuals have access to necessary mental health support.
Whether you're looking for affordable options through MA or PMAP or exploring Medicare or commercial insurance for more extensive coverage, the right decision should reflect your personal needs. By gathering the information provided and considering your individual situation, Minnesota residents can successfully navigate the mental health insurance landscape.
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