Mental Health Insurance in Canada: What’s Covered and How to Choose the Right Plan

Why Mental Health Insurance Matters More Than Ever

Let’s be honest: in Canada, mental health care isn’t a luxury – it’s essential. Whether you’re dealing with stress, anxiety, depression, or simply navigating life’s challenges, access to mental health support is a cornerstone of overall wellness.

Yet many Canadians still don’t get the help they need. Why? Because the right coverage is often missing or because the coverage they do have doesn’t go far enough. Over half (57%) of  people aged 18-24 who had early signs of a mental illness said that cost was an obstacle to getting mental health services, according to the Canadian Mental Health Association.

This guide will help you cut through the confusion, understand what’s actually covered, and choose a mental health plan that fits both your needs and your budget.

What Mental Health Services Are Covered in Canada?

Mental health support in Canada varies widely depending on who’s providing the care- and who’s paying for it. Not all services are treated equally under insurance plans, and understanding what’s covered can help you navigate the system more effectively.

Who Provides Care and Who Pays?

Mental health professionals come in different forms, and so does their coverage:

• Psychiatrists and Hospital-Based Specialists: These professionals are generally covered by provincial health plans like OHIP (Ontario), AHCIP (Alberta), and MSP (British Columbia). However, access often depends on a referral from your family doctor, especially in provinces like Quebec and BC. Always check your provincial plan for the specific process.
  
• Psychologists, Therapists, and Counsellors: These services are usually not included in public health plans. If you’re seeking talk therapy or Cognitive Behavioural Therapy (CBT), expect to pay out of pocket unless you have private or employer-sponsored insurance.

Are Medications Covered?

Coverage for mental health prescriptions (like those for anxiety, depression, or ADHD) is handled separately under drug plans. These could be provincial, employer-based, or private. The level of coverage depends on your specific plan and province.

Why Many Canadians Still Pay Out-of-Pocket

While Canada’s healthcare system covers about 70% of overall medical expenses, the remaining 30% often falls to individuals or their insurance. Many people find that although therapy is technically “available,” high costs and long wait times make consistent care hard to access.

Support Through Employer Plans

Workplace benefits can offer some relief. Many group plans provide between $300 and $1,000 per year for mental health services, which may include:

• Psychologists
• Social workers
• Registered psychotherapists

Comparing Private Mental Health Insurance Plans in Canada

Choosing a plan isn’t just about what’s included, it’s about how usable the coverage is. Here are some things to consider when reviewing your plan or deciding what coverage is best for you.

How Much Coverage Is Typical for Therapy or Psychologists?

• Many individual or employer-sponsored plans cap therapy at $500 to $1,000 per year.
• Reimbursement often looks like this:
  
  • 80% of each session
  • $100 max per visit

Annual Maximums, Per-Session Limits, and Reimbursement Models

Watch out for these common limits:

• Annual cap: The most you can claim each year (e.g., $750)
• Per-session cap: Maximum reimbursable per visit (e.g., $100)
• Reimbursement rate: Often 80%, meaning you still pay 20%

Therapy Costs in Canada Without Insurance 

If you’re paying out-of-pocket, therapy can add up quickly. It is best to review your provider's rate and determine the total charge you will be left paying. If you have a mental health coverage plan, be sure to calculate how much it will cover versus much you will be left to pay out-of-pocket.

Average Cost for Private Therapy in Canada

• Psychologist: $125–$200/hour
• Counsellor or psychotherapist: $100–$150/hour
• Psychiatrist: Covered through public plans, but often has long waitlists

Out-of-Pocket Cost Examples for 2025

Let’s say you need 10 therapy sessions at $150 each. That’s $1,500/year and that’s on the low end for consistent support (Pharecouncelling, 2024).

Common Pitfalls to Watch for in Your Health Insurance Policy

Insurance is meant to give you peace of mind, but the details can sometimes do the opposite.

Session Limits That Aren’t Enough

Some plans limit you to just four or five sessions per year. For anyone needing ongoing support, that’s barely enough to get past introductions with a therapist.

Referrals and Pre-Approval Loopholes

Some plans require a physician’s referral to start therapy. Others need pre-approval forms before the first appointment.

Before you book anything, ask: “Do I need a referral? Is pre-approval required?”

Group Plan Assumptions That Don’t Match Reality

You might assume your employer plan covers therapy, but many only reimburse a small portion. Check the wording: “psychologist,” “psychotherapist,” and “clinical counsellor” may all fall under different categories.

How to Choose the Best Mental Health Insurance Plan for You

You don’t need a PhD in insurance to make a smart decision. But it helps to ask the right questions. Here are a few key questions to help you get started:

Questions to Ask Your Insurance Provider 

• What’s the annual max for mental health coverage?
• Is the amount shared with other paramedical services?
• Are online therapy platforms reimbursable?
• Do I need a referral or pre-approval?

What Type of Mental Health Practitioner You’ll Likely Use Most

• Seeing a psychiatrist for medication? The public plan likely covers it.
• Need ongoing therapy with a psychologist? Check your reimbursement rate.
• Prefer flexible support via online counselling? Ask if it's included.

What is PolicyMe’s Mental Health Coverage?

PolicyMe offers a number of various health insurance plans with mental health coverage. While there are a range of plans, generally you can expect annual coverage limits of $500-$1300 with a reimbursement of $75-$100 per session. 

Examples of mental health practitioners that are covered include: 

• Clinic counsellor
• Registered marriage & family therapist
• Psychologist
• Psychotherapist
• Social Worker (RSW)

Summary: Mental Health Insurance

Mental health care in Canada is essential, but navigating the insurance landscape can be confusing. While public plans cover psychiatrists and hospital-based care, most people need private or employer-sponsored insurance to access services like therapy and counselling.

Here's the bottom line:

• Therapy isn’t fully covered unless you have a strong private plan.
  
• Even with insurance, you may face session caps, reimbursement limits, and pre-approval requirements.
  
• Costs can escalate quickly, especially if you need long-term care.

Tip: If your current plan doesn’t offer enough, consider topping it up with a solution like PolicyMe, which offers clear and practical mental health coverage options.

FAQ: Mental Health Insurance in Canada