DISCLAIMER: I am not an insurance or billing professional, nor do I work for or with an insurance company (though I am married to someone who does) and have limited experience with the topic that follows. As a profession just emerging as insurance-compensated providers, there is a LOT of material (in the form of industry articles, continuing education classes, and seminar topics) educating massage therapists about insurance. The following should not be taken as medical or insurance advice, but simply the perspective of a massage therapist and medical provider on the topic as it stands. If you feel I've got something wrong, I would graciously invite you to (politely) bring it up in the comments below.
Worker's Compensation (L&I)
Commonly called Labor & Industries in WA state (or L&I for short), referring to the state agency that insures most Worker's Comp claims in Washington. In addition to providing certain OSHA-like regulation and oversight of employment conditions in the state, L&I acts as a state-owned insurance company, funded by mandatory payments by employers and employees (in the form of a payroll tax) into an insurance fund. There are 400 or so large employers who can opt to self-insure, but MOST employees in the state of Washington are covered by L&I.
Worker's Comp claims are for injuries that occur as a result of one's employment, most notably traumatic injury (fell off scaffolding, foot run over by a forklift, etc) and repetitive stress injury (i.e., carpal tunnel syndrome, or any strain/sprain resulting from repeatedly performing the same physical task for 40 hours a week).
L&I covers massage and will pay for 6 visits with a referral from the Attending Physician (the doctor primarily responsible for treating this particular injury, not necessarily your regular doctor). Visits beyond the first 6 may be paid for, but the provider must submit progress notes showing efficacy of treatment and medical necessity before they will be approved.
I don't know what eldritch formulae the number-crunchers at L&I use to decide which cases will be given approval for additional visits and which ones will be denied, but I assume that it involves a hat or dartboard, because it doesn't seem to have any correlation with the aforementioned efficacy and/or medical necessity of treatment.
In order to accept L&I payment, a massage therapist needs to be licensed to practice in the state of Washington, and also needs to register themselves and their clinic with the Department of Labor and Industries.
Personal Injury Protection (PIP)
This is the medical coverage that you pay for as part of your auto insurance, assuming that you did not waive PIP coverage when purchasing insurance in order to save money on your premiums. If you DID waive coverage, your auto insurance WILL NOT cover any of your medical expenses if you are in a Motor Vehicle Collision (MVC). We are fortunate in WA state in that auto insurers will cover massage up to the limits of coverage for your PIP insurance, which (unless you are also getting lots of expensive treatments from other, non-massage providers) you are unlikely to meet before your massage therapist closes your case (either because you have reached "pre-injury status" or because continued treatment is unlikely to yield any more improvement).
In WA state there is no other requirement for a therapist to bill PIP except that they be licensed to practice in the state.
3rd Party Insurance (Liability)
This category includes any insurance claim that is being paid by someone else's insurance. Usually this is either a MVC where the other driver was at fault, or any injury otherwise resulting from someone else's negligence (commonly referred to as a "Slip & Fall" because the most common cause is injury from slipping and falling on a wet floor or icy walkway on commercial property).
3rd Party claims involve law suits, which involves lawyers, and lots of arguing. Sometimes they go on for years before a final judgement or settlement is made, and the therapist is not paid until that time. There is no guarantee that the final judgement or settlement will include payment for massage or any medical bills at all, so sometimes a patient can be stuck holding the bill for rather more massage than they would have opted to receive had they known they would be paying for it themselves. In these cases, massage therapists (and other medical providers) are left in the very unfortunate position of either becoming a bill collector or writing off a large amount of income they have already done the work for.
Major Medical Insurance
This category includes most other insurance not covered by those above. Whether included in a benefits package from an employer, paid for at great personal expense, or obtained through the state via Medicaid, this is a person's primary or "main" insurance used to cover most medical expenses. WA state is fortunate in that it is one of several states where medical insurance covers massage. However not EVERY insurance plan covers massage - indeed, most of them still do not. In addition, there are so many different carriers with so many different plans that the details of how much coverage is provided and what restrictions are placed on coverage vary greatly.
Some medical insurance will pay for "out of network" benefits, meaning ANY provider can bill the insurance company for services provided - or the patient can pay out of pocket, and submit their own request for reimbursement from the insurance company after the fact. Most commonly, however, in order to receive payment from medical insurance, a therapist must be what is called a "participating provider," meaning that they have entered into a contractual agreement with the insurance company. Every company and every plan is different, but generally the provider agrees to accept a certain allowed amount for the service provided, and is not allowed to bill the patient more than that. Other stipulations or benefits in a provider contract can vary.
In order to become a contracted provider, many insurance companies require that a provider have a certain amount of experience, references from colleagues in the field, and other requirements to establish the provider's bona fides. Furthermore the insurance may restrict the number of providers they will contract with, limiting them for instance to a certain number of providers in a given zip code.
There are other types of insurance out there, such as Medicare (federally-subsidized insurance for the elderly and/or disabled). Medicare definitely does not cover massage, and if there are other kinds of insurance than those listed above that DO cover massage, I have not heard of them.
If you have read this far, congratulations! You are a highly tolerant reader! You can look forward to more explanation of why a massage therapist would choose not to accept insurance in a future blog entry here.