What you’ll learn in this article…
- Medicaid faces $1 trillion cuts, threatening coverage for 11.8 million people.
- Counselors are permanently paid only 75% of psychologists' Medicare rate.
- 137 million Americans live in mental health professional shortage areas.
In 2025, the American Counseling Association spent $180,000 as an in-house lobbyist to advance mental health policy reforms, a figure that measures how urgently the profession’s economic footing needs defense. At the same time, 137 million Americans, or 40% of the population, lived in federally designated Mental Health Professional Shortage Areas.1
Those two numbers capture a crisis that counselors feel daily: Medicare permanently reimburses LPCs at only 75% of the psychologist rate for identical billing codes, proposed Medicaid cuts could strip coverage from over 11 million people, and the federal government has stopped enforcing mental health parity requirements.
Policy advocacy in 2026 is not a sideline; it determines whether clients can access care and whether a counseling practice stays solvent.
ACA's 2026 Federal Lobbying Priorities
What exactly is the American Counseling Association pushing for on Capitol Hill in 2026? The ACA’s federal lobbying agenda this year concentrates on safeguarding the profession’s viability and client access by tackling three urgent challenges: the threat of massive Medicaid cuts, the persistent Medicare reimbursement gap, and the erosion of mental health parity enforcement.
Protecting Medicaid Access for Mental Health Clients
Millions of Americans with mental health needs depend on Medicaid, and deep funding reductions would strip coverage from vulnerable populations, including a large share of those with opioid use disorders.1 The ACA is urging lawmakers to reject proposals that would destabilize the safety net and exacerbate the mental health workforce shortage that serves these communities. The message is clear: cutting Medicaid is cutting mental health care.
Closing the Medicare Reimbursement Disparity
Licensed Professional Counselors and Licensed Mental Health Counselors remain locked into a permanent federal policy that pays them only 75% of the rate psychologists receive for identical billing codes.1 This inequity discourages clinicians from entering or staying in the public system, exacerbating shortages. The ACA continues to make the case that equal work deserves equal pay, pressing Congress for a legislative fix that recognizes counselors as full partners in behavioral health.
Upholding Mental Health Parity Rules
When insurance companies can ignore mental health parity enforcement requirements without consequence, clients face higher out-of-pocket costs and limited access. The ACA is fighting for stronger oversight after regulators signaled they would not enforce the 2024 parity rule.1 The association is building support for congressional scrutiny or new legislative language that would hold payers accountable and restore the intent of parity laws.
Counselors who want to follow these efforts can review the ACA’s federal lobbying disclosures through public transparency databases or monitor the association’s advocacy pages for real-time policy alerts and calls to action.
Key Mental Health Bills ACA Supported or Opposed in 2026
In 2026, the American Counseling Association (ACA) has actively lobbied on several key bills affecting counselor reimbursement, addressing the mental health workforce shortage, and client access to care. Below are the major pieces of legislation the ACA has endorsed or opposed, along with their current status.
Medicare and Workforce Bills Endorsed by the ACA
- Mental Health Access and Provider Support Act (H.R. 8081 / S. 4202): This bipartisan bill would raise Medicare reimbursement for licensed professional counselors (LPCs) and licensed mental health counselors to 85% of the physician fee schedule rate. The ACA strongly supports the legislation, which remains in committee as of mid-2026.
- More Behavioral Health Providers Act: Introduced in February 2026, this bill would extend the Health Professional Shortage Area (HPSA) bonus to mental health counselors, helping address the mental health counselor shortage by state. The ACA endorsed this bill; it remains in committee.
Budget and Appropriations Stances
- One Big Beautiful Bill Act: The ACA vocally opposed this sweeping budget measure, which proposed roughly one trillion dollars in Medicaid cuts over ten years. With 51% of adults with mental health disorders relying on Medicaid, the cuts would have jeopardized coverage for millions. The bill stalled amid bipartisan pushback, but the ACA continues to monitor similar threats.
- Fiscal Year 2026 Appropriations: The ACA pushed for full funding for Student Support and Academic Enrichment (SSAE) grants and a 250:1 student-to-school-counselor ratio, as well as expanded telehealth flexibilities. These provisions were included in the final spending package.1
Past Legislative Wins
While 2026 advocacy is ongoing, the ACA’s prior support for the Law Enforcement De-Escalation Training Act (signed into law in late 2022) demonstrates the organization’s ability to shape federal policy around mental health. That bill funded crisis intervention training for officers, reflecting the ACA’s long-term commitment to improving community responses to mental health emergencies.
The Medicare Reimbursement Gap: Why Counselors Are Paid Less
For a 60-minute psychotherapy session (CPT 90837), a licensed professional counselor receives $115.721 from Medicare, while a psychologist gets $154.291 for the same service. This $38.56 gap reflects a permanent statutory rule:2 licensed professional counselors and licensed mental health counselors are reimbursed at only 75% of the psychologist fee schedule rate for all Medicare Part B psychotherapy codes.
The Permanent 75% Reimbursement Rule
Medicare calculates the allowed amount for counselors by taking 80% of the lesser of the actual charge or 75% of the psychologist fee schedule amount.3 This formula applies to every billing code. For a diagnostic evaluation (CPT 90791), the counselor allowed amount is $130.01 versus $173.35 for psychologists4. A 45-minute session (CPT 90834) pays counselors just $85.434. The gap widens across hundreds of sessions annually, directly reducing income for counselors in private practice, community agencies, and rural clinics.
Financial Impact on Counselors and Clients
The statutory 75% rate creates a steep disincentive for counselors to serve Medicare clients. In federally designated mental health counselor shortage areas, where 40% of Americans already live6, this can mean fewer providers willing to accept Medicare. Clients with depression, anxiety, or substance use disorders may face longer waits or travel distances. For counselors, the lower rate erodes practice sustainability. Other non-physician providers, such as nurse practitioners and physician assistants, receive 85% of the physician fee schedule5, underscoring the inequity for mental health professionals.
The Fight for Reimbursement Parity
The Mental Health Access Improvement Act, effective January 1, 2024, finally brought counselors into Medicare but preserved the 75% rate.3 A follow-up bill, the Mental Health Access and Provider Support Act, would eliminate the disparity, but as of mid-2026 it has not been enacted.3 Without legislative change, counselors remain stuck at a rate that undervalues their services and threatens access for millions of Medicare beneficiaries.
Questions to Ask Yourself
Medicaid Funding Threats and the Mental Health Workforce
Proposed cuts to Medicaid funding pose a direct threat to the stability of the mental health workforce and the clients they serve. As federal lawmakers consider spending reductions, counselors across the country face the prospect of losing coverage for a significant portion of their client base, along with reimbursement rates that were already insufficient.
The One Big Beautiful Bill Act and Coverage Loss
The One Big Beautiful Bill Act, currently under consideration, would cut federal Medicaid funding by approximately one trillion dollars over a decade. According to the Congressional Budget Office, an estimated 11.8 million individuals would lose Medicaid coverage directly, with an additional 3.1 million affected indirectly. These figures represent a dramatic shift in the healthcare safety net, particularly for low-income and vulnerable populations who rely on Medicaid for behavioral health services.
Disproportionate Impact on Mental Health Patients
Medicaid is the single largest payer of mental health services in the United States. More than half of adults with any mental health disorder depend on it for care, and the majority of those with opioid use disorders are covered by the program. Rolling back Medicaid means that millions of people with depression, anxiety, substance use disorders, and severe mental illness would be forced to navigate a fractured system with limited options, potentially leading to increased emergency room visits, homelessness, and involvement with the criminal justice system.
How Counselors and the Workforce Are Affected
For licensed professional counselors and mental health counselors, Medicaid cuts translate into both ethical and practical challenges. When clients lose coverage, therapists face difficult choices about providing pro bono care, shortening treatment, or turning people away. Moreover, Medicaid reimbursement rates for counselors are already set at only 75% of the psychologist rate for the same billing codes, making it financially marginal to accept these clients. A loss of volume compounds the problem, making it harder for community mental health counselors and private practitioners to stay afloat. This, in turn, exacerbates the existing mental health provider shortage, with 40% of Americans already living in designated shortage areas.
Advocacy and Ongoing Responses
The American Counseling Association and allied organizations are actively lobbying against these cuts, highlighting the long-term costs of dismantling mental health access. Yet, without sustained pressure from counselors, students, and clients, the most severe proposals could pass, reshaping the landscape of mental health care for years to come.
As of December 2025, 137 million Americans, or 40% of the population, lived in a federally designated Mental Health Professional Shortage Area. This means that policy shifts, like Medicaid cuts or reimbursement gaps, hit harder because there simply are not enough counselors to meet demand. Every funding cut or regulatory rollback widens the gap between those needing help and those available to provide it.
Mental Health Parity Non-Enforcement: What It Means in Practice
On May 15, 2025, the Departments of Labor, Health and Human Services, and Treasury jointly announced that they would not enforce the 2024 final rule implementing the Mental Health Parity and Addiction Equity Act (MHPAEA).1 This decision effectively freezes the rule's key provisions, including requirements for insurers to demonstrate parity in nonquantitative treatment limitations (like prior authorization) and to collect and report data on mental health coverage.
Consequences for Patients and Providers
As a result, without enforcement, insurance companies face no federal penalty for placing more restrictive limits on mental health care than on medical care. Patients can expect more claim denials, higher out-of-pocket costs, and reduced access to therapy and counseling services. For providers, especially licensed professional counselors, it means less leverage when appealing denied claims or challenging discriminatory reimbursement practices. The anticipated increase in federal parity investigations has stalled, leaving counselors with fewer avenues for holding insurers accountable.
Erosion of Parity and Reimbursement Challenges
Mental health parity is built on the principle that coverage for mental health conditions must be no more restrictive than coverage for physical health conditions. The non-enforcement announcement signals a retreat from that commitment. Counselors already face a significant reimbursement gap: they are permanently reimbursed at only 75% of the psychologist rate for the same billing codes under Medicare.1 When insurers are not required to prove parity, they can further depress rates for counselors, refuse to cover certain services, or impose administrative hurdles that delay payment. This undermines the financial sustainability of behavioral health practices and discourages new professionals from entering the field.
The American Counseling Association's Response
The American Counseling Association has been vocal in opposing the non-enforcement, warning that it jeopardizes decades of progress toward equitable mental health coverage. As of 2026, the rule remains unenforced, and the ACA continues to urge members to contact their legislators, share data on reimbursement disparities, and support state-level parity bills that can fill the federal enforcement void. Counselors are encouraged to document every instance of unfair insurance practices and report them to the ACA's advocacy team. Without sustained pressure, the gap between mental health and medical care coverage will only widen.
State-Level Advocacy: Where the Fight for Reimbursement Parity Is Happening
State-level advocacy is emerging as the primary battleground for mental health reimbursement parity. While federal reforms stall, counselor associations in Georgia, New Mexico, and Texas secured concrete gains in 2025 that demonstrate a playbook for practitioners nationwide.
Georgia Enforces Parity with a New Review Panel
Georgia's SB 131 (2025) created a Parity Compliance Review Panel, empowering the state to audit insurers for violations of the Mental Health Parity and Addiction Equity Act.1 Although not a direct reimbursement mandate, the panel strengthens enforcement of existing parity requirements, indirectly pressuring carriers to close payment gaps between LPCs and other providers.
New Mexico Removes Copayments for Behavioral Health
New Mexico's SB 120 (2025) eliminated cost-sharing for behavioral health services.1 By removing copays and deductibles, the law makes therapy with LPCs and LMHCs financially accessible, reducing a barrier that often forces clients to postpone care. This model legislation aligns with ACA's priority of equal access regardless of provider type.
Texas Invests in the Workforce
Texas SB 646 (2025) expanded the Mental Health Professional Loan Repayment Program, targeting debt relief for counselors and school counselors in rural and underserved areas.1 While not a reimbursement bill, it addresses the workforce crisis directly, recognizing that financial incentives draw clinicians into areas with a rural mental health services gap where 40% of Americans lack adequate mental health access.
Getting Involved in State Advocacy
Counselors can join their state ACA chapter, which tracks legislation and organizes lobby days. Many chapters provide template letters, talking points, and direct connections to lawmakers. The ACA's 2025 legislative priorities explicitly include state-level parity, meaning resources and coordination are stronger than ever. Participating in these efforts does not require policy expertise, only a willingness to share how reimbursement gaps and coverage barriers affect your clients daily.
How Counselors Can Get Involved in Advocacy
Effective advocacy begins with using the tools and events the American Counseling Association (ACA) provides to amplify your voice on mental health policy.
ACA Hill Day 2026: Face-to-Face Advocacy in Washington
On September 16-17, 2026, the ACA hosts its annual Hill Day advocacy event in Washington, DC. The two-day event combines in-depth advocacy training on day one with pre-scheduled congressional office visits on day two. Typically drawing over 100 participants1, counselors will converge to push for permanent telehealth coverage for licensed professional counselors and to advance counselor recognition within Medicare, as outlined in the ACA legislative priorities. The ACA Hill Day Grant Program provides direct financial assistance to counseling students and practitioners, ensuring diverse perspectives reach Capitol Hill.
Sustaining Advocacy at the State and Local Level
Year-round engagement is equally powerful. The ACA’s VoterVoice platform streamlines contacting lawmakers with pre-drafted letters that automatically route to your representatives based on your zip code. Pair this with the monthly virtual Advocacy Practice Hours series, held via Zoom, which dissect federal and state policy shifts and coach counselors on effective messaging. State chapters frequently coordinate local lobby days, allowing you to fight for licensing portability and Medicaid reimbursement directly with state legislators, often by joining forces with sister organizations. Use your professional social media channels to share policy calls-to-action and educate clients on how legislative battles impact their access to care.
Your Call to Action
Sustaining advocacy infrastructure requires resources. Donate to the ACA Political Action Committee to help elect mental health champions. Sign up for legislative alerts so you never miss a critical vote. Most importantly, weave basic policy literacy into client conversations; an informed client base becomes a potent force when they contact their own representatives. Every conversation, donation, and visit builds toward a system where counselors finally receive the reimbursement and recognition their work demands.
Looking Ahead: What the Future Holds for Mental Health Counseling
Looking ahead, several positive trends signal a brighter future of counseling. Telehealth parity extensions are gaining momentum in state legislatures, ensuring that virtual sessions remain reimbursed equally to in-person visits. School-based mental health funding has also increased, with federal and state budgets allocating more resources to place counselors directly in schools. These developments, coupled with a growing public awareness of mental health needs, could translate into stronger political will for long-overdue policy reforms.
The Advocacy Landscape Ahead
On the advocacy front, the next few years will likely bring shifts in administration or Congress that could either advance or challenge recent gains. The ACA is closely monitoring these developments, preparing to defend hard-won progress while seizing new opportunities. The ongoing fight for full Medicare recognition and parity enforcement will remain central, as counselors continue to be reimbursed at only 75% of the psychologist rate.
Your Role in Shaping the Future
Ultimately, the profession's future hangs on sustained counselor engagement. The ACA will persist in its lobbying efforts, but it cannot succeed alone. Every call to a lawmaker, every donation to the advocacy fund, and every conversation with colleagues about the importance of parity strengthens the collective voice. By staying involved, counselors can shape a future where their expertise is fully valued and their clients have unimpeded access to care.
