Why Having Insurance Still Doesn’t Guarantee Mental Health Care

Jessica Bachman–a mother of four and a special education teacher–went through numerous obstacles when she tried to access mental health services for her now 10-year-old son.

When her son began experiencing anxiety, finding a therapist turned into a major challenge; her insurance network had very few pediatric specialists, and some were not accepting new patients.

Her son finally started with a clinician, only for them to go out on medical leave. Bachman located another provider, but felt they didn’t really understand her son’s needs. A third specialist lacked the necessary experience and reported that her son’s care was outside her scope of practice.

Throughout elementary school, the situation intensified as her son’s behavior brought on new challenges. There were emergency room visits and unsuccessful attempts to secure inpatient care. At one point, they found a program that was a good fit for him, only to be told their insurance would not cover it because the facility was out-of-network.

Bachman noted that despite having insurance, they still faced immense hurdles trying to access care.

‘There were so many layers to this process–and then we were back to square one. It was a bit of a hurricane ride. It’s up, it’s down, it’s worse, it’s better,” Bachman said.  It took a few years and significant effort before her son was finally connected to the right services.

Bachman’s ordeal illustrates the barriers to mental health treatment that are increasingly commonplace for many Americans. Mental health experts report that provider shortages, lack of insurance, high cost, and ongoing stigma around mental illness create significant challenges in accessing care. Marginalized communities can also be particularly impacted by health care disparities. These barriers are further exacerbated by insurance denials, increased prior authorization requirements, budget cuts, and a profit-driven commercial health insurance industry. Historically, many health insurance companies have implemented administrative and financial barriers that make accessing mental health services more challenging than obtaining other types of care.

Major insurers’ role in political campaigns and lobbying has also increased. Since 2010—after the Supreme Court’s Citizens United ruling—health insurers went from being limited in their political spending to being allowed to make unlimited donations through super PACs. According to Mental Health America, one in four adults with an identified mental health need reported difficulty in accessing treatment in the past year. Even those with health insurance struggle to get services. At the same time, the nation’s largest insurance companies made billions in profits.

“Insurance companies do provide a service, but commercial health insurance in America is often a profit-driven system—and that creates numerous challenges to accessing care,” said Angela Kimball, chief advocacy officer for Inseparable, a national mental health advocacy organization.

In 1996 and again in 2008, Congress passed legislation to address some of these concerns. The 2008 passage of The Mental Health Parity and Addiction Equity Act (MHPAEA) prohibited insurers from putting more coverage restrictions on mental health than they would on medical or surgical care. While legislative changes under the MHPAEA made improvements to coverage—and later the Affordable Care Act barred insurance companies from refusing to cover individuals with pre-existing conditions, including mental illness—insurance companies still have significant discretion to deny or limit critical mental health care.

Experts report that better enforcement of MHPAEA, increased patient awareness regarding their appeal rights for denied services—including the right to a third-party external appeal—and proposed federal legislation can help lower barriers to mental health services.

Why Insurance Doesn’t Guarantee Access to Mental Health Care

Studies show that the longer it takes a patient to connect with a mental health provider, the less likely they are to receive treatment–and the higher the out-of-pocket costs, the less likely an individual is to receive or remain in care.

“Ghost” networks—when an insurance company’s mental health provider directory is filled with inaccurate information–contributes to delays. Frequently, providers listed in the directory are no longer active in the plan, are retired, are not accepting new patients, or have incorrect contact information. Highlighting the scope of this issue, a 2023 analysis by the Senate Finance Committee found that of 120 mental health provider listings for Medicare Advantage plans across six states, over 80% were “unreachable, not accepting new patients, or not in-network.”

Additionally, a recent investigation by the Department of Health and Human Services Office of Inspector General found that 72% of behavioral health clinicians listed in many Medicaid and Medicare insurance directories were actually “inactive providers.”

Recently, ghost networks have led to legal action. The American Psychiatric Association filed a class-action lawsuit against EmblemHealth in January 2026. The suit alleges that the insurer operated a ghost network filled with misleading information, deceiving plan members and “artificially inflating” the number of psychiatrists in the network.

Providers also report that insurers are driving them out of the network with reduced and delayed reimbursement.

Alphonso Gaita, a licensed clinical social worker in New York who owns his own practice, has experienced this firsthand. In 2025, he received a letter from a major health insurance company denying his claim for treatment that he had provided to a patient. The letter did not indicate why it was denied.

“There was no information provided in the letter on why the claim was denied. I am a licensed provider in this insurer’s network, and they did not give me any specifics on what was wrong,” Gaita said.

After multiple calls and emails, Gaita’s claim was finally approved—it took one year. And after all of this effort, Gaita has still not received the check. Gaita said that payment delays lead to experienced providers leaving insurance networks.

“As therapists, we are very committed to helping people, but we also need to be able to survive and run our practice,” Gaita said. “But as more providers leave due to these obstacles, patients have less options, can’t get help, and their mental health can decline, especially if they can’t afford to pay out of pocket,” he explained.

On July 4, 2025, President Donald Trump signed H.R. 1, a massive spending bill that cuts nearly a trillion from Medicaid, the largest payer of behavioral health services in the country. The bill also impacts access to crisis intervention programs and mental health services. Right after H.R.1 was passed, the Administration also eliminated the suicide hotline for LGBTQ+ youth. The Congressional Budget Office reports that an estimated 10 million people will lose their health insurance under H.R.1.

Mental health experts, including the American Psychological Association, the National Association of Social Workers, and the American Foundation for Suicide Prevention, have warned that the cuts under this bill will have a detrimental impact on access to care.

Jeremy Haines, director of public policy and government relations for the National Association of Social Workers, said that Medicaid is one of the main funding sources for many hospitals, clinics, and different mental health programs and these facilities are used by many patients, not just Medicaid recipients.

“When Medicaid is cut and people lose coverage, facilities will lose money and they’re going to start cutting services, which will impact everyone,” Haines explained.

Rewriting the Rules to Increase Access to Mental Health Care

Several bills currently pending in Congress have the potential to improve standards of care, including the Primary and Behavioral Health Care Access Act, which was introduced in June 2026, by Sen. Angus King (I-ME), Rep.Lauren Underwood (D-IL) and Rep. Kim Schrier (D-WA).

This bill would require health insurance companies to cover three outpatient behavioral health visits and three primary care visits each year with no out-of-pocket costs.

“States that pass legislation that provide a certain number of free visits a year are helping to lower barriers to getting treatment,” Kimball said. Kimball added that while this bill may not address every barrier, it’s a start. “Incremental change is better than no change–and this is an opportunity for more people to gain access to mental health services,” she said.

Jennifer Snow, the national director for government relations, policy and advocacy for the National Alliance on Mental Illness (NAMI), said that there are different ways that ghost networks can be addressed.

“More robust enforcement of the existing mental health parity law could address this issue by forcing plans to ensure that there are enough providers in their network to provide necessary mental health services,” Snow explained.

Kimball also emphasizes that constituent involvement can play an integral role in making policy changes. Patients who encounter ghost networks can file a complaint with their state department of insurance.

“Reporting this puts pressure on the states to address it with insurers. They typically don’t act if there are no complaints,” Kimball said.

She added that while there can be an assumption that the health care system is too big to take on, change is still possible. Kimball recommended that constituents call their representatives about current mental health legislation– and, if they are comfortable, share how they have been personally impacted.

“Calling elected officials about pending legislation can be very impactful,” she said. “If no one is calling, then they can assume no one cares about these bills. It’s understandable why many people are frustrated—but I’ve also never felt more strongly that the power of people’s stories actually does move votes.”

In Bachman’s case, she decided to reach out to her state comptroller’s office over her inability to find a provider for her son.

“It may sound strange that we called an elected official over the provider issue, but we were at our wits end. We did not know what else to do,” she said. It worked. Within a few days, her son finally had an appointment with a specialist who took her insurance and he is now receiving services. Bachman encouraged other families to contact their elected officials for health care-related issues.

“They work for us and when constituents have problems they should be there to assist,” she added.

Downcoding also creates challenges. This occurs when a clinician bills for a specific treatment, but the insurer will only reimburse them for a lower-paying service. The use of downcoding is increasing, particularly due to the use of AI tools that analyze claims.

Insurers claim they need to downcode to prevent overbilling, but consumers often pay the price. To make up for lower reimbursements, many providers and facilities may attempt to squeeze in more patients, making appointments harder to schedule and leaving clinicians with less time.

Snow said the demand for mental health care continues to grow, but downcoding leads to a shortage of providers.

“Health care providers rely on appropriate reimbursement to remain financially stable so they can continue to deliver much-needed care in communities,” said Snow.

Lawmakers in Illinois recently passed a bill addressing access to care issues, including strict limits on downcoding. Illinois state Rep. Sharon Chung (D-Bloomington) reported that she spearheaded the bill after a constituent brought his concerns about downcoding to her.

Kimball said this bill could serve as a model for other states, but it must include downcoding protections for behavioral health providers as well.

H.R.1 brings significant changes to Medicaid, including forcing many recipients to renew their coverage every six months, which can create extra obstacles for patients to keep their plan active and lead to gaps in mental health treatment.

Many health care experts and policy makers are working on repealing parts of H.R.1, particularly if there is a change in the political landscape after the 2026 midterms and the 2028 general election.

Snow said that NAMI is working to address the most concerning parts of H.R.1.

“NAMI strongly supports efforts to repeal the damaging provisions of H.R. 1 which put health insurance at risk for millions of people with mental illness,” she said.

H.R. 1 has strained an already complicated U.S. health care system while concerns over access to mental health treatment continue to grow—yet pending legislation and active involvement from constituents and mental health experts present real opportunities for change.

“We need to repeal parts of H.R.1 and not allow this law to become the norm—and as clinicians, we should always push back against harmful systems,” Gaita said.