Family Therapy: How to Document Medical Necessity

Family involvement can be a powerful intervention, particularly when a client’s mental health is shaped by or contributes to relational dynamics.

Family therapy may include:

• Systemic interventions targeting relational patterns that reinforce symptoms
• Psychoeducation to help family members understand diagnoses and support treatment
• Building skills to reduce conflict and increase support
• Emotional regulation work involving shared coping skills or parenting strategies
• Increased treatment engagement and adherence by aligning with support systems

However, not all sessions that include additional participants meet the criteria for billing as family therapy, and it can be challenging to determine when this code is clinically and ethically appropriate, or when self-pay may be the better option.

This guidance aims to help you:

• Identify when to bill 90847
• Recognize when to consider self-pay models
• Understand how to document family therapy sessions to support clinical needs and payer requirements

Key definitions

Identified Patient (IP): The individual whose mental health condition is the focus of treatment. Must have a billable diagnosis and meet medical necessity criteria.

Qualifying Mental Health Diagnosis: A diagnosable condition that meets medical necessity criteria for treatment, as defined by DSM-5 TR and payer policies. Z-codes or related problems (V codes) alone generally do not qualify.

Medical Necessity: The service must be necessary to diagnose, treat, or manage a mental health condition, with clear justification in the documentation.

Collateral: The term used to describe a spouse/partner or family member who participates in therapy to assist the identified patient.

When to use 90847

The fundamental requirement for billing 90847 is that the session must directly support the treatment of an Identified Patient (IP) with a qualifying mental health diagnosis for which the involvement of family member(s) or other participants’ is medically necessary for addressing the IP’s symptoms, functional impairments or treatment goals.

In other words:

• There is a clearly defined IP with a qualifying mental health diagnosis.
• Family member(s) or other participants' involvement is medically necessary for the IP’s treatment.
• The session’s purpose is to directly address the IP’s symptoms, impairments, or treatment goals.

When to recommend self-pay

Providers should recommend self-pay options when:

• Neither partner has an identified mental health condition requiring treatment.
• The primary goal is relationship counseling rather than the IP’s symptom treatment.
• The service is not covered by the identified client’s insurance plan.
• Documentation cannot support medical necessity.

Documentation guidelines

To support medical necessity and meet payer expectations, the corresponding documentation should reflect:

Identified Patient (IP): The note clearly names the one individual who is the identified patient and lists their qualifying diagnosis (not just Z-codes).

Collateral: The note clearly specifies every person who was present for the session by their name and relationship to the IP.

Medical necessity for family involvement: The documentation explains why the presence and participation of the family member(s) were medically necessary to effectively treat the IP's mental health symptoms/diagnosis.

This can be done by:

• Naming the IP’s diagnosis/symptoms
• Connecting the family dynamics contributing to the persistence or worsening of IP’s symptoms and functioning
• Linking the family member’s presence to a clinical need (e.g., progress in treatment, prevent worsening of symptoms), not just a preference
• Using interventions focused on improving IP’s functioning / symptoms / behaviors.
• Tying everything back to the associated treatment plan goal

A focus on the IP's treatment plan: The session summary clearly connects the discussion and interventions back to the goals in the IP's treatment plan. (Note: It’s best practice to identify family work as an intervention or service line on the treatment plan itself.)

A response for client and collateral(s) to the treatment interventions: The session summary includes responses for both the client and the family member(s) present in session.

Common pitfalls to avoid

Omitting the Identified Patient (IP): Failing to clearly name and focus on the IP in documentation.

Using a non-billable diagnosis code: Listing a Z-code or other non-qualifying code as the primary diagnosis can result in claim denial.

Insufficient justification for family involvement: Lack of documented medical necessity for the presence or participation of family members or collaterals.

Not identifying participants: Omitting the names and relationships of all individuals present in the session (e.g., “client’s mother”, “spouse”).

Missing treatment plan alignment: Failing to include family therapy as a planned intervention or service on the IP’s treatment plan.

Focusing only on relationship concerns: Summarizing sessions with a focus on general relational issues not clearly tied to the IP’s diagnosis or functioning.

Incorrect use of 90846: Using 90846 for non-IP-related issues (e.g., parental marital conflict) is a high audit risk when documentation does not clearly show the focus is on supporting the IP’s diagnosis/treatment goals. The "Identified Patient" must always be the beneficiary of the service.

Same-day billing: Billing 90847 or 90846 on the same day as individual therapy (9083x codes) without using a -59 modifier. Documentation must explicitly prove that the sessions were separate and distinct services (non-continuous).

When reviewing notes

As yourself the following questions:

1. Does my note clearly name the Identified Patient (IP) and their diagnosis?
2. If an auditor read this note, would they understand why the other participants were necessary for the IP's treatment?
3. Is the focus of the note clearly tied to the IP's treatment plan goals, rather than general marital or family counseling?

For a guide on what should be included in all documentation, please see these general guidelines for medical necessity.