In recent years, more people have begun to recognize the therapeutic potential of an old medicine called ketamine. This commonly used anesthetic is increasingly being employed in outpatient settings at low doses, not as an anesthetic agent but as an innovative treatment for mental health conditions such as major depressive disorder, generalized anxiety disorder, post-traumatic stress disorder (PTSD), and obsessive-compulsive disorder (OCD).
Despite its growing acceptance in psychiatry, one of the main challenges patients face when seeking ketamine for the treatment of mental health conditions or chronic pain is navigating the complexities of insurance coverage and the associated costs. As of 2025, for the most part, ketamine is not covered by insurance providers, with a system that typically favors FDA-approved medications while often ignoring other effective therapies, such as the off-label use of ketamine.
While one form of ketamine therapy, Spravato (esketamine) nasal spray, has received FDA approval and is more likely to be covered by insurance, other common ketamine treatments such as intravenous (IV) infusions, intramuscular (IM) injections, and oral ketamine remain largely uncovered. This disparity is not based on effectiveness but rather on regulatory approval, financial incentives, and the influence of pharmaceutical companies like Johnson & Johnson, which holds the patent for Spravato and profits from its exclusivity. Understanding and navigating this intricate insurance landscape is crucial for individuals seeking access to ketamine therapy.
IV ketamine is considered the most effective route of administration, particularly for individuals with treatment-resistant depression. This is due to its safety profile, highest response rate, rapid action, and lowest relapse rate compared to other methods. By administering the medication directly into the bloodstream, IV ketamine ensures accurate dosing and can offer symptom relief, often within hours.
Treatment typically begins with an induction phase consisting of six to eight initial infusions twice weekly, followed by periodic maintenance sessions as needed. However, it's important to note that IV ketamine is not FDA-approved for depression treatment, so insurance coverage is rare.
IM injections offer an alternative to IV therapy, making them a suitable option when IV insertion is challenging or if the individual has an aversion to IV infusions. While IM injections are considered to be as effective as IV infusions due to the use of racemic ketamine, it is important to note that, like IV ketamine, IM ketamine is not FDA-approved for psychiatric use and is unlikely to be covered by insurance.
Oral ketamine is typically taken as a lozenge or tablet, offers an option for at-home use. However, it is considered less effective than IV or IM administration due to variable absorption rates and lower bioavailability. Response rates are lowest for oral ketamine and often exhibit a delayed effect lasting weeks, similar to that of oral antidepressants. Patients often utilize oral ketamine at a lower psycholytic dosage instead of the standard 0.5 mg/kg dose, which ensures the threshold for antidepressant effects is met.
Some patients use oral ketamine as maintenance therapy after completing IV or IM treatments, but many find it significantly less effective, with shorter-lasting effects compared to these other forms. Oral ketamine is not approved by the FDA and is rarely covered by insurance.
The nasal spray is currently the only form of ketamine therapy approved by the FDA for major depressive disorder depression. Due to its approval, insurance companies are more likely to cover Spravato treatment if patients meet specific diagnostic criteria. However, it is important to note that insurance does not cover treatments for conditions like generalized anxiety disorder, post-traumatic stress disorder, substance use disorder, or obsessive-compulsive disorder.
Spravato treatments must be administered in a healthcare setting under medical supervision, and patients typically require several initial treatments—often around twelve—during the induction phase. While Spravato enjoys broad insurance coverage, studies have shown that it is less effective than IV ketamine, with a higher relapse rate and a slower onset of action.
The main reason IV and IM ketamine are not covered by insurance is their lack of FDA approval. For a new drug to gain FDA approval, pharmaceutical companies must conduct preclinical testing (in laboratories and on animals) followed by human clinical trials (typically in three phases) to demonstrate safety and efficacy. The approval process for new drugs is extremely costly, often requiring hundreds of millions of dollars for research, trials, and regulatory filings.
Without a patent, and since IV and IM ketamine are already generic drugs, a company cannot recoup these costs through exclusivity rights. This financial disincentive explains why, despite overwhelming evidence of IV ketamine’s effectiveness in treating depression, there has been no FDA approval effort for psychiatric use.
In contrast, Johnson & Johnson invested heavily in getting Spravato (esketamine) approved, a process that allowed them to monopolize the insurance-covered ketamine market. Esketamine is a chemical derivative of ketamine and was specifically designed to be a patentable alternative to generic ketamine. The result is a treatment that insurance companies recognize due to its FDA approval, while more effective treatments like IV ketamine remain uncovered simply because they lack the backing of a major pharmaceutical company.
Since its FDA approval in 2019, Spravato has become a billion-dollar industry, largely due to its exclusivity in the insurance market. Insurance companies prefer to cover Spravato over IV ketamine for several reasons. First, because it is FDA-approved, insurers are required to recognize it as a legitimate treatment. Second, Spravato is administered under strict medical supervision, which reduces liability concerns for insurance providers. However, these factors do not necessarily mean that Spravato is the best treatment available. In reality, many patients report better and faster results with IV ketamine than with Spravato, but they often have to pay out of pocket for IV therapy while their insurance covers Spravato.
Insurance coverage for ketamine therapy varies significantly depending on the provider, state, and the specific treatment. Many major insurance companies cover Spravato under specific conditions, while IV and IM ketamine remain largely uncovered. However, even with coverage, high co-pays and strict prior authorization requirements often make access difficult for some patients.
Insurance coverage for Spravato includes providers such as:
For IV and IM ketamine, insurance coverage is highly limited. In rare cases, some Blue Cross Blue Shield plans may reimburse a portion of the cost for IV ketamine treatments. Additionally, the VA may cover ketamine therapy for veterans with PTSD if a Veterans Care Agreement (VCA) is in place. A VCA is a contract between the U.S. Department of Veterans Affairs (VA) and community healthcare providers, allowing eligible veterans to receive care outside the VA system when VA facilities are unable to provide the necessary treatment. However, most private insurance companies and government programs do not cover IV ketamine
Patients who are paying out-of-pocket for ketamine therapy often turn to health savings accounts (HSA) and flexible spending accounts (FSA) to manage costs. These accounts allow patients to pay for treatments using pre-tax dollars, reducing the financial burden.
If you're seeking ketamine therapy, there are steps you can take to increase the likelihood of obtaining partial insurance reimbursement. Consider the following strategies:
As of 2025, insurance coverage for ketamine therapy remains highly dependent on FDA approval status rather than treatment effectiveness. The nasal spray derivative of ketamine, known as Spravato (esketamine), receives extensive coverage thanks to its FDA approval and financial backing from Johnson & Johnson, whereas IV and IM ketamine are mostly not covered despite demonstrating better efficacy. Patients seeking ketamine therapy must navigate a complicated insurance system, file appeals, and explore alternative funding options. While the future of ketamine insurance coverage remains uncertain, ongoing research and advocacy efforts may eventually broaden access to IV ketamine for those who need it most.
About the Author
Dr. Ray Rivas, a former general and trauma surgeon with over a decade of experience utilizing ketamine, became a ketamine therapy specialist to treat mental health and pain after witnessing its profound impact on his hospital trauma patients and his own mental health. As the founder and medical director of Innerbloom Ketamine Therapy in San Luis Obispo, California, Dr. Rivas applies his extensive medical expertise to provide safe, evidence-based ketamine treatments for mood disorders, including depression, anxiety, PTSD, and chronic pain. His passion lies in helping patients find relief and rediscover hope through personalized, compassionate care.
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