What Can You Do When Insurance Does Not Cover Ketamine Treatment for Mental Health?

Most field experts prefer ketamine infusion therapy over intranasal esketamine (Spravato®) because of its superior performance in large-scale clinical trials. Remission after IV administration lasts longer, and the side effects are fewer (Bahji et al., 2021). Yet, insurers only pay for Spravato® for depression treatment, thanks to its FDA approval status. This means that IV ketamine must be paid for out-of-pocket by most patients.

If insurance does not cover IV ketamine for mental health treatments, how can you give patients the best therapeutic option and sustain your business at the same time? We discuss these issues and more in this article.

Why Won’t Insurance Companies Cover Ketamine Infusion Therapy for Mental Health Conditions?

Generic IV ketamine, also referred to as “racemic ketamine,” is an FDA-approved treatment option for analgesia and anesthesia but not for psychiatric illnesses.

This NMDA receptor blocker was originally intended to replace phencyclidine as an equipotent anesthetic with fewer side effects. The evidence for its psychopharmacological benefits did not come until close to Parke-Davis’ patent expiration (Mion, 2017).

At that point, the company would have more to lose by seeking to expand generic ketamine’s FDA-approved indications. So the drug remains exclusively as an anesthetic agent up to now, at least, from the regulatory standpoint. As long as no one pushes to change the status quo, treating mental health issues with generic ketamine infusions will continue to be “off-label.”

Without FDA approval, Medicare and Medicaid are free to exclude the drug’s generic IV version from their mental health formularies, and so are private insurers. That is the biggest reason why insurance won’t pay for your patients’ generic ketamine infusion treatment sessions (Gillick, 2009; US Centers for Medicare & Medicaid Services, 2021).

The FDA scrutinizes each drug’s premarketing performance meticulously. Clinical studies are designed to test efficacy and safety on large cohorts. Only after demonstrating immense therapeutic value will a drug get FDA approval (US Food and Drug Administration, 2020).

It’s a lengthy and extremely expensive process, but it is designed to help ensure safety and efficacy.

Though rampant in oncology, insurance providers usually do not cover off-label drug use. For one, a drug is considered ineffective until proven otherwise. Insurers will not want to be seen as advocating a potentially ineffective treatment. For another, most investigational drugs prove to have no therapeutic use in the end, making coverage for such treatments cost-inefficient (Gillick, 2009).

You may say that racemic ketamine should be regarded differently because research shows that it rapidly quells mental health symptoms and crises. But even this is not enough to change its FDA status, as we explained in a previous article.

What Would the Benefits of Insurance Coverage for Ketamine Infusion Be?

Studies show that health insurance coverage is truly a game-changer for people with chronic illnesses like depression.

  • Insurance reduces the prevalence of undiagnosed depression. People with depressive symptoms are more likely to have themselves checked if they know that they can afford physician visits (Baicker et al., 2018).

  • Insurance significantly decreases the prevalence of untreated depression. Good access to care makes it easier for depressed individuals to seek therapy (Baicker et al., 2018; Fry et al., 2018).

  • Insurance improves patients’ adherence to treatment. Marginalized people, such as most retired seniors, cannot afford the high antidepressant medication costs. But insurance increases antidepressant use in this group (Donohue et al., 2011).

  • Insurance reduces relapses. Treatment adherence ensures more symptom-free days for impoverished patients on long-term mood disorder treatment (Donohue et al., 2011).

  • Insurance decreases hospitalization costs. Coverage disruptions among the depressed are associated with more emergency department visits and inpatient days. The opposite is true when coverage is continuous (Ji et al., 2017).

  • Insurance reduces total health care costs. Lower hospitalization expenses cut down overall health spending (Ji et al., 2017).

  • Insurance curbs mortality rates. One study found that extending Medicaid eligibility reduced treatment delays, lowering adjusted all-cause mortality by 6.1% (Sommers et al., 2012).

So, wouldn’t it be nice if insurers paid for repurposed off-patent medications like ketamine? That would make it easier to help more people living with lifelong non-surgical conditions like CRPS, PTSD, bipolar disorder, severe depression, and many others.

The biggest concern among patients with major depressive disorder is the development of suicidal ideation. IV ketamine infusion is more effective than esketamine nasal spray in treating depressed individuals with baseline suicidality (Siegel et al., 2021). Greater access to this form of therapy can save many lives. But withholding insurance coverage may deny you, the ketamine provider, this opportunity.

How Can You Make IV Ketamine Therapy More Accessible to Patients with Mental Health Issues?

When running an IV ketamine treatment center, expect most insurers to refuse coverage outright for the medication’s use on mental health. But what can you do to help patients who see it as their last hope for getting better?

The following solutions work for most practitioners:

Getting a Billing Consultant

A good billing consultant will help you figure out if and how you can charge insurance providers for at least some parts of patients’ visits. There’s a myriad of billing and coding procedures that medical professionals are not aware of (Gruber et al., 2002). It’s best to leave these tasks to a true expert so you can maximize your patients’ insurance benefits and minimize out-of-pocket expenses.

If you’re not keen on keeping the billing expert on staff, you may also pay them as a consultant to train you and your permanent employees in proper billing and coding practices.

Tasking Your Staff to Coordinate with Healthcare Funding Agencies

Public and private mental health funding institutions abound. You just need to know where they are and how to get in touch with them. These organizations can make treatments more affordable for the ketamine patient through grants or subsidies. Collaboration with them can also make your business more attractive and sustainable.

If you have a busy practice, you may assign the responsibility to one of your employees, preferably someone familiar with medical and social work (Carlo et al., 2018).

Helping Your Patients Appeal Their Insurance Claims

Every state empowers patients to appeal rejected insurance claims.

An “internal appeal” is filed with the insurance company itself, which will review the case and its decision. An “external appeal” involves a third party, usually someone from the government, and is invoked when an internal appeal is disapproved. Patients may appeal declined insurance claims at little or no cost (US Department of Health and Human Services, 2017).

Your role is to strengthen your patients’ cases. You can do this by submitting documents proving that ketamine IV infusion is their best hope for battling their mental health or chronic pain conditions (CMS, 2021).

Partnering Up with Healthcare Financing Institutions

Medical loans pay for treatments not covered by insurance like cosmetic surgery and off-label ketamine therapy. People can repay them in small installments over a set period. They usually do not require collateral, and funds are available right away. You can get medical loans within your patients’ reach by partnering up with a healthcare lending institution.

Not all establishments require high credit scores. So check out several prospects if you want to help make payments easy for more IV ketamine treatment recipients (Fay, 2020).

Setting up insurance alternatives at your office takes time and effort. But it will be all worth it when you see more patients getting better and your clinic operating hitch-free.

Going the Extra Mile for Patients Needing Intravenous Ketamine

Most health insurance companies currently do not cover IV ketamine therapy for mental health conditions due to regulatory limitations. But research demonstrates that continuous coverage can considerably benefit depressed individuals.

If you want to make this treatment more affordable to a greater number of people, you should consider helping your patients look into a variety of funding options. Doing so requires connecting with the right people and working a little harder at the beginning. Things will flow smoothly from there.

And when your ketamine clinic has helped so many people get better, you will realize that healthcare is, indeed, a noble profession!


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Baicker, K., Allen, H. L., Wright, B. J., Taubman, S. L. & Finkelstein, A. N. (2018). The Effect of Medicaid on Management of Depression: Evidence from the Oregon Health Insurance Department. The Milbank Quarterly, 96(1), 29-56. https://doi.org/10.1111/1468-0009.12311

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Ji, X., Wilk, A. S., Druss, B. G., Lally, C. & Cummings, J. R. (2017). Discontinuity of Medicaid Coverage: Impact on Cost and Utilization among Adult Medicaid Beneficiaries with Major Depression. Medical Care, 55(8), 735-743. https://doi.org/10.1097/mlr.0000000000000751

Mion, G. (2017). History of Anesthesia: The Ketamine Story–Past, Present and Future. European Journal of Anesthesiology, 34(9), 571-575. https://doi.org/10.1097/eja.0000000000000638

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