Why Doesn't Insurance Cover Ketamine?

There are a few answers to this question, but probably the most significant reason that insurance companies don’t cover ketamine treatments is that they don’t have to.

Insurance companies have maintained that ketamine treatments are experimental and that they should not have to pay for them despite the substantial research and demonstrated efficacy in clinical use by medical professionals (including our published results).

Until enough customers demand that insurance companies cover ketamine, they just won’t. These customers are patients and the companies choosing employee plans, but not doctors.

New Drug Variations, FDA-Approval, and Insurance:

Ketamine is an old drug, and the patent has long expired, which means it won’t ever be a billion-dollar drug for a pharmaceutical company in its original state. It was originally FDA approved for anesthesia and analgesia. Because it already has FDA approval it can be used “off-label” for other indications. Up to 1/5 of all medications prescribed are used off-label. Many of these are covered by insurance with no complaints. Propranolol, for instance, is an FDA approved blood pressure medication that is used commonly for migraines and tremors.

Companies have recently patented both the S- and R- enantiomers of the racemic ketamine mixture. If that sounds like Latin to you, Congratulations! – It is! Ketamine forms as a chiral mixture, that means RS-ketamine is created as a 50:50 mixture of two identical mirror image molecules. Identical except that the bend of one of the molecules faces right and one faces left – like how a right and left hand are identical mirror images. These two together are a mixture we call racemic ketamine or just ketamine. The right-handed molecules alone are called Arketamine or R-ketamine and the left-handed molecules alone are called Esketamine or S-ketamine. The S-and R- forms, unsurprisingly, behave in the body almost exactly like each other and like the 50:50 mix. But there are some differences.

S- ketamine is used commonly in Europe for anesthesia. It has higher potency for anesthetic properties and hallucinations than R- ketamine. S-ketamine was recently approved by the FDA to treat severe depression. The safety data was all derived from the original work on ketamine and the efficacy data was anemic at best and the approval generated lots of controversy as it didn’t meet the usually stringent criteria that other medications have had to meet. Usually many large studies have to be done in a double blinded controlled method and the drug needs to show it is well-tolerated and much more effective, or at least as effective, as others in its class.

R-ketamine is actively being developed into a drug that is expected to get FDA approval perhaps as early as 2022. It showed greater potency and longer-lasting antidepressant effects than S-ketamine (Spravato) in several studies.

Insurance doesn’t consistently cover these variations of ketamine despite S-ketamine’s FDA approval. Many of you have probably had the experience of having a medication prescribed only to go to the pharmacy and discover that it is “non-formulary” and you can have an alternative but not the one written by your doctor! Non-formulary is a fancy way of a drug company saying “we won’t pay for that, this alternate is good enough.”

(Here's more information on conventional ketamine vs new variations: Ketamine versus New Derivative Drugs for Depression).

Possibly, maybe getting some reimbursement:

Since we opened Lone Star Infusion in 2015, we have slowly begun to see a little movement in patient reimbursement by their insurers. While the insurers don’t have policies to cover ketamine treatments, and while they will rarely reimburse the full cost of a treatment, some patients may be able to collect some money from their insurance company – with a lot of work.

Each insurance company does this a little differently. Often different patients will even see different results from the same insurer. Some patients may get the expense applied to deductibles, some patients may get the office visit covered, and there are a few patients who are say they are being reimbursed by their insurance for the entire amount of their treatments.

I wish it was more uniform and I wish it didn’t take so much follow up and homework on the patient’s side. But insurance companies don’t have to cover something just because it has FDA approval. They don’t have to cover it at a reasonable price. They don’t have to cover generic ketamine even when a less-effective derivative of ketamine got FDA approval.

You may still have to pay, even if insurance does cover your treatments:

Even when insurance does cover ketamine treatments patients can still be on the hook for most of the cost of the treatment because of the high-deductible plans and large co-pays we are seeing and the relatively low cost of the number of visits most patients need. For example, if your deductible is $4,500 that’s 12 treatments, enough for the six initial treatments and 6 follow ups.

Why we don’t take insurance:

We are happy to give patients advice and support and help and superbills to take to their insurance companies. The constant appeals and denials and run-around that is standard with insurance companies have driven many doctor’s offices out of business. We aren’t their customers and insurance companies don’t have to go out of their way to make us satisfied and whole. Many of our patients already know that mental health as a whole is very poorly reimbursed by insurance and many providers have chosen to leave in-network coverage rather than continue to endlessly fight for fair payment.

It remains the case that insurers don’t pay for ketamine treatments, with exceptions proving the rule. We cannot take insurance because we would not be reimbursed.

We’re working on it:

We hope more coverage is coming soon, and we’re working on it! Dr. Wells is a founding member of the Ketamine Task Force, a group that is working toward insurance coverage for ketamine treatments.

About Me, Dr Allison Wells: I started Lone Star Infusion, here in Houston, to provide ketamine infusions for depression, anxiety, PTSD, CRPS and other mood disorders and pain conditions. I am a licensed, board-certified anesthesiologist. I am super passionate about being a partner in helping people feel their best with evidence-based medicine.

An Important Disclaimer: The information in this and other blog posts represents my informed opinion or the opinion of others, and does not constitute medical advice and should not be relied upon to make decisions regarding medical care. To address the specific details of your medical conditions and treatments please speak with your doctors.