Psychotherapy should only be funded by vocational rehabilitation (VR) when it is recommended by a licensed psychologist or psychiatrist and is provided by a licensed mental health professional. Psychotherapy by unlicensed professionals can only be funded if a licensed professional is providing supervision and is assuming full responsibility. The supervision arrangement needs to be documented in writing and all progress reports must be co-signed by the supervisor.

Because the definition and nature of psychotherapy varies greatly among qualified providers, it is often difficult to determine exactly what is being provided when psychotherapy has been authorized. Therefore, before therapy is authorized a statement should be obtained from the treating source that specifically outlines the following information:

  1. The type or types of treatment modalities that will be employed.
  2. The anticipated length of treatment that will be needed.
  3. Treatment goals and the manner in which progress will be assessed and reported.
  4. A statement of how the proposed treatment specifically relates to the vocational objective.
  5. Prognosis and expected outcome.

Under most circumstances, VR should fund a maximum of 12 psychotherapy sessions (one hour sessions weekly over 12 weeks usually); however, an absolute limit of 12 psychotherapy sessions may be problematic because it may unfairly restrict the use of some potentially effective treatment modalities and may not adequately address the needs of clients with severe psychiatric impairments. Therefore, on an individual basis, additional psychotherapy sessions beyond the initial 12 session limit may be authorized as follows:

Funding by other sources (i.e. self payment, other insurance, or Medicaid-Medicare) would not be counted toward this limit. Also, once the 48 session limit is reached, there is no requirement that the client’s case be closed. Other VR services could certainly continue to be provided if needed, although in such cases it may be advisable to seek input from the District and/or State Psychological Consultant.

Rates for psychotherapy provided by licensed physicians or psychologists:
20-30 minutes - $58.50
45-50 minutes - $117

See other Medicaid codes for services provided by licensed mental health professionals who are not physicians or psychologists.