How to choose a behavioral health billing company: 10 questions to ask

What makes behavioral health billing different

A billing company that does well for primary care can still lose money for a psychiatry clinic or a therapy group. These are the areas where mental health billing experience shows up in your collections:

• Time-based psychotherapy codes. 90832, 90834 and 90837 are chosen by documented face-to-face time (16 to 37 minutes, 38 to 52 minutes, and 53 minutes or more under CPT). A 50-minute session billed as 90837 is a coding error that auditors look for.
• Add-on codes with E/M. When a psychiatrist or nurse practitioner does medication management and psychotherapy in one visit, the E/M code is billed with 90833, 90836 or 90838, and the note has to show the therapy time separately. See our guide to psychotherapy add-on codes 90833, 90836 and 90838.
• Carve-outs. Many health plans contract a separate behavioral health organization to manage mental health benefits. Claims sent to the medical plan on the card are denied as "wrong payer" and the timely filing clock keeps running.
• Credentialing for every clinician type. Psychiatrists, psychiatric nurse practitioners, psychologists, LCSWs, LPCs, LMFTs and associates each enroll differently, and some payers will not credential pre-licensed clinicians at all.
• Telehealth rules. Place of service 02 or 10, modifier 95 or 93 for audio-only, and Medicare's in-person requirement, which now applies from January 1, 2028 unless Congress acts again.
• Collaborative care and integrated care codes such as 99492 to 99494 and 99484, which need monthly time tracking and a registry.
• High volume, low dollar. A therapy group can send hundreds of claims a week for $80 to $150 each. Small denials that nobody works add up to real money fast.

Signs it is time to change how you bill

• Days in AR creeping up, for example above 45, or a growing share of AR older than 90 days. Our days in AR guide shows the formula.
• New therapists seeing patients before they are in network, or seeing them only as self-pay.
• Repeat denials for the same reasons: wrong payer, missing authorization, time not documented, eligibility.
• Patient balances growing because statements go out late or not at all.
• The person who does your billing is also your front desk, your scheduler and your office manager.

10 questions to ask a behavioral health billing company

Ask every company on your shortlist the same questions and write the answers down. A specialist will answer the behavioral health ones with examples, not general statements.

1. How many behavioral health practices do you bill for today, and which kinds? Psychiatry, therapy groups, addiction treatment and intensive outpatient programs are billed differently. Ask for the mix and a reference that looks like you.
2. How do you check psychotherapy time before a claim goes out? Look for a review of the documented minutes against 90832, 90834 and 90837, and of separate therapy time when an add-on code is billed with an E/M visit.
3. How do you identify carve-out payers? The answer should include an eligibility check that shows the behavioral health payer before the first visit, not after the first denial.
4. Who handles credentialing for new clinicians, and how do you track it? Ask for typical timelines by payer, how they track applications, and whether they hold or bill claims while enrollment is pending.
5. How do you bill telehealth sessions? Ask which place of service codes and modifiers they use by payer, and how they track Medicare's in-person requirement and audio-only rules.
6. Which EHRs do you work in? Valant, TherapyNotes, SimplePractice, AdvancedMD and others each have their own billing workflows. Working inside your EHR keeps your data and your view of every claim with you.
7. What does the percentage cover, and what is extra? Get included and excluded services in writing, and confirm the fee applies to net collections, not charges.
8. How do you work denials and small balances? Ask how they prioritise low-dollar therapy claims and how quickly a denial is worked. Ask for their denial rate by reason for a practice like yours.
9. What will we see each month? At minimum: collections, AR aging, denial rate by reason, clean claim rate and credentialing status by clinician.
10. Who owns the data, and what happens if we leave? Payer accounts and portals should stay in your practice name, payments should go to your bank account, and the contract should say how open AR is handed back.

Worked example: what a credentialing gap costs a therapy group

A therapy group hires a licensed professional counselor who will see 20 commercial sessions a week. The average allowed amount for those sessions is $95 (an example figure: use your own fee schedule). Enrollment with the group's main payers takes 90 days.

Starting enrollment 90 to 120 days before the start date, and tracking every application weekly, is worth more than almost any other billing decision a growing group makes. Ask each billing company to show you how they would have handled this case.

How behavioral health billing companies charge

Most charge a percentage of net collections. Some charge per claim or a flat monthly fee, which can look cheap for a high-volume therapy group until denials and follow-up are priced separately. Compare the total cost for the same scope, and ask what is quoted separately: credentialing, eligibility checks, patient statements and authorizations are common add-ons. If you are weighing outsourcing against keeping billing in-house, our in-house vs outsourced medical billing cost calculator puts both on one page.

Scorecard for comparing two or three companies

Score each company from 1 to 5 on each line, using their written answers and a review of the same 20 de-identified claims.

Red flags

• No current behavioral health clients, or no references in your field.
• "We bill every specialty the same way."
• A fee based on charges instead of collections.
• No plan for credentialing new clinicians.
• Payments deposited into an account you do not control.
• A long contract with no exit plan or data return.

What to check in the contract

• A business associate agreement under HIPAA, and how patient data is accessed.
• Term, minimums and notice needed to end the agreement.
• Who owns the data and payer accounts, and how records come back.
• How open AR is worked after termination, and whether a fee applies.
• The list of included and excluded services, including credentialing and patient statements.
• Reporting you receive and how often.

Where PhysiAssist fits

PhysiAssist bills for psychiatry clinics and therapy groups. Certified coders review time and add-on codes before claims go out, our team handles credentialing and eligibility, and we work inside your EHR. A psychiatry clinic in Massachusetts came to us with a large backlog; we recovered $1M in 75 days and days in AR fell from over 90 to under 40 (read the case study). For a new psychiatry clinic, we ran payer enrollment, billing setup and the first claims while it grew from 10 to 100 patients a month by month five. PhysiAssist charges 2.8% to 5% of net collections, with no setup fees or minimums; see pricing and our behavioral health billing services. We would rather you compare us with others using the questions above than take our word for it.

Frequently asked questions

What does a behavioral health billing company do?

It checks eligibility and benefits, finds the right behavioral health payer, codes and submits claims, posts payments, works denials and follows up on unpaid claims for a psychiatry or therapy practice. Many also handle credentialing, prior authorization and patient statements.

How much do medical billing companies charge for behavioral health?

Most charge a percentage of net collections; others charge per claim or a flat monthly fee. PhysiAssist charges 2.8% to 5% of net collections with no setup fees or minimums. Always compare the total cost for the same scope, including credentialing and patient statements.

Is it worth outsourcing billing for a small therapy practice?

Often yes, because a small practice pays a full salary for billing but has no backup when that person is away, and credentialing delays hit small groups hardest. Compare your in-house cost with a percentage fee before deciding.

Can Medicare be billed for therapists who are not psychologists?

Yes. Since January 1, 2024, marriage and family therapists and mental health counselors can enroll in Medicare and bill independently, paid at 75% of what a clinical psychologist receives under the Physician Fee Schedule (CMS).

What is a behavioral health carve-out?

It is when a health plan contracts a separate company to manage mental health and substance use benefits. Claims and authorizations go to that company, not to the medical plan, so eligibility checks need to identify it before the first visit.

Does Medicare still pay for tele-mental health at home without an in-person visit?

Yes, for now. The Consolidated Appropriations Act, 2026, signed on February 3, 2026, delayed the in-person visit requirement for Medicare tele-mental health through December 31, 2027.