Many therapy clients come to their first session eager to get started but quickly run into one of the most common barriers to consistent care: confusing insurance billing. Terms like deductible, copay, coinsurance, and EOB (Explanation of Benefits) are often misunderstood, leading to billing surprises, delayed payments, or missed appointments.
As a mental health provider, you’re often the first line of support when a client receives an unexpected bill or doesn’t understand why insurance didn’t cover their session. Explaining these common insurance concepts clearly can go a long way in building trust, avoiding frustration, and keeping clients engaged in care.
This blog post will walk you through how to explain deductibles, EOBs, copays, and coinsurance in a way that clients can understand and appreciate.
Why It Matters: Helping Clients Understand Therapy Costs
Most clients don’t fully understand how their mental health insurance benefits work, especially if it’s their first time in therapy. Because billing issues often arise after sessions have begun, the resulting confusion can negatively impact the therapeutic relationship.
When you take a few moments to explain the basics up front, during intake or early sessions,you show that you care about transparency and want to make therapy accessible. Clear billing conversations can reduce:
- Missed appointments due to unexpected costs
- Unpaid sessions or delayed reimbursements
- Distrust caused by surprise fees or confusing claims
Let’s break it down.
1. What Is a Deductible?
A deductible is the total amount a client must pay out of pocket for healthcare services before their insurance starts paying for treatment.
How to explain it:
“Think of your deductible as a yearly spending requirement. Until you hit that amount—say $1,500—you’re responsible for paying the full cost of your sessions. Once you meet that number, your insurance will start helping cover the cost.”
Encourage clients to call their insurance provider or review their benefits to see how much of their deductible has already been met. If you verify benefits as part of your intake, explain what that means for their upcoming sessions.
2. What Is a Copay?
A copay is a fixed dollar amount a client pays for each session, regardless of the total session fee.
How to explain it:
“A copay is a set amount you owe for each therapy session—like a flat fee. If your plan says you have a $25 copay, that’s what you’ll pay each time, and insurance covers the rest.”
Some clients assume copays count toward their deductible. While this can vary by plan, that’s not always the case. Be ready to clarify if needed.
3. What Is Coinsurance?
Coinsurance is the percentage of the session cost that the client must pay after their deductible has been met.
How to explain it:
“After you’ve met your deductible, your insurance doesn’t always pay the full session fee. Instead, they cover a portion, and you pay the rest. If your coinsurance is 20%, and a session costs $100, you’d pay $20, and your insurance would pay $80.”
Clients often confuse coinsurance with a copay. The key difference is that a copay is a flat amount, while coinsurance is a percentage of the total cost.
4. What Is an EOB (Explanation of Benefits)?
An EOB, or Explanation of Benefits, is a summary that shows how an insurance claim was processed. It includes what was billed, what insurance paid, what was denied, and what the client may owe.
How to explain it:
“An EOB isn’t a bill. It’s a statement from your insurance company that explains how they handled the claim for your session. It shows what they paid and whether there’s any remaining amount you’re responsible for.”
Encourage clients to bring their EOBs to you if they don’t understand something. It’s better to address confusion early rather than have billing issues interrupt care.
Other Terms Clients Might Need Help Understanding
- Out-of-pocket maximum: The most a client will pay in a year before insurance covers 100%
- Network status (in-network vs. out-of-network): Whether you’re contracted with their insurance
- Superbill: A detailed receipt clients can submit to insurance for reimbursement if you’re out-of-network
Providing definitions and simple examples can make these terms feel less intimidating.
Educating Clients Builds Trust and Encourages Ongoing Care
Insurance literacy helps clients feel more in control of their mental health journey. By explaining insurance basics clearly and early on, you empower clients to plan for their care and eliminate billing surprises that could derail progress.
You can also provide a printed FAQ, handout, or onboarding email that includes these definitions in plain language. It’s a small step that makes a big difference in client experience.
Let Anchor Point Billing Solutions Help Simplify the Process
At Anchor Point Billing Solutions, we specialize in mental health billing and client communication. Our team supports therapists, psychologists, counselors, and social workers in private practice, helping them save time and reduce stress.
We handle:
- Insurance verification
- Client-friendly benefit summaries
- Claim submissions and follow-ups
- Denial management and appeals
- Superbills and monthly reports
Let us manage the billing, so you can focus on client care.
Need help simplifying your billing and improving communication with clients?
Reach out to Anchor Point Billing Solutions, your dedicated mental health billing experts, today and find out how we can support your practice every step of the way.