The Real Psychedelic Bottleneck Is Coverage

T Wagner, Gaetano Lardieri, Nichelle Santos, Jessica Umlauf, Vaughn Wagner

At PhilaDelic 2025, the most consequential question was not whether psychedelics can help people. It was whether U.S. healthcare can recognize, reimburse, and safely scale the kind of care these treatments actually require. The molecule is rarely the bottleneck. The bottleneck is coverage: the administrative, financial, and operational machinery that determines what becomes a routine benefit versus a boutique, cash-pay luxury.

Picture the moment that would make “psychedelic medicine” real for most people. It is not a headline or a breakthrough trial result. It is a patient—or a burned-out nurse, a city EMT, a teacher—opening a benefits portal during open enrollment and seeing what is actually covered, what is cash-pay, and what will become a financial cliff. That is where psychedelic care either becomes healthcare, or stays aspirational.

This is the missing chapter in most psychedelic reporting. Coverage hinges on unglamorous questions: how a therapy is coded, documented, staffed, risk-managed, and audited; whether a payer can write a defensible medical policy; whether clinics can sustain the workflow; and whether employers can purchase it as a benefit without inheriting clinical liability. Those operational details decide what counts as care at scale.

At the PhilaDelic 2025 Fall Forum, lead organizer T Peterson Wagner brought together clinicians, payers, employers, and operators to help fill in this gap. The same pattern kept surfacing: access grows when delivery becomes practical and intelligible, when someone turns a complex intervention into something a plan can buy, a network can deliver, and a claims system can process. Ketamine shows this dynamic in the clearest, most immediate way.

Ketamine: Cheap Drug, Expensive Care

At the conference, Penn psychiatrist Michael Thase put it bluntly: ketamine costs “less than 50 cents a dose,” calling it “a remarkably powerful, inexpensive potential for … treatment of depression.”

Yet ketamine remains out of reach for many patients because coverage is driven by the delivery model, not the molecule. Insurers reimburse services—clinician time, nursing time, monitoring time, facilities, documentation, and follow-up. Ketamine care, especially when paired with psychotherapy, often requires longer visits, closer observation, and more coordination than the standard 15-minute medication-management workflow. And because Intravenous (IV) ketamine for psychiatric indications is largely off-label–medically used for a non-indication it was originally FDA approved for–many plans either exclude it or cover only fragments of the model (often the medical visit, not the dosing-and-support time). The predictable result is a cash-pay market even when the medication itself is cheap.

In practice, the cost drivers are straightforward:

• supervision and site-of-care overhead during administration
• time-intensive preparation, follow-up, and integration
• documentation needed to support medical necessity and auditability
• operational complexity (staffing, scheduling, continuity) that clinics must sustain

Ketamine is a powerful proof-of-concept because it exposes what payers are actually deciding. The question is not “does it work?” The question is whether a complex, time-heavy intervention can be made legible to claims systems and defensible to medical directors.

Coverage decisions usually hinge on a small set of requirements:

• Evidence and indication: a defined diagnosis, defined eligibility criteria, and measurable outcomes
• Regulatory posture and standards: FDA approval, off-label use, or a state-regulated service model determines how medical policy is written
• A billable pathway :the care must map to particular Current Procedural Terminology (CPT) codes or a credible reimbursement structure, even when sessions are long.
• Risk management: Prior authorization and medical-necessity rules operate as liability controls as much as cost controls

When these questions are hard to answer, traditional insurers tend to stall. Self-funded employers and municipalities experiment instead, because they can add benefits, measure downstream costs (claims, disability, absenteeism), and ideally find safer and more effective alternatives to currently covered treatments.

That is exactly where medical cannabis becomes an aspirational model.

Cannabis Went First

Medical cannabis shows how a stigmatized, federally illegal therapy can still move into mainstream access. At PhilaDelic, Nichelle Santos (CannaCoverage Founder and CEO) and Gaetano Lardieri (CannaCoverage Sr. Advisor and Innovative Officer, Special Executive Advisor and co-Founder of Future Entheogenic Medicines [F.E.M.]) presented their working model for the next level of care: In Trenton, NJ, CannaCoverage and F.E.M. have contracted with the city and school districts to offer employees a medical cannabis benefit add-on. The add-on benefit was integrated seamlessly into current health plans, with discounts at participating dispensaries and telehealth access all embedded directly into the existing health-benefits ecosystem.

Their goals, as Santos described it, are “building alternative benefits to increase patient access to alternative therapeutics, to improve health outcomes and affordability, [and] to democratize alternative benefits to make the world a better place.” Already, CannaCoverage and F.E.M. ‘s municipal partners are reporting health benefits. They have found that medical cannabis becomes a replacement therapy strategy: an often safer alternative for patients with chronic pain and substance use disorders (SUD). 

It’s also pragmatic; not only is medical cannabis a promising treatment, but it is also much cheaper than the usual pain or addiction treatments, crucial for municipal health budgets already stretched thin. Municipal health budgets in New Jersey are, on average, the second-largest line item after payroll, and these costs are expected to double or triple over the next few years. Leaders are under pressure to identify sustainable alternatives to expensive, protracted treatment pathways, especially in pain and behavioral health. 

As Santos framed it, “Public administrators of municipalities, school boards, and counties are facing unsustainable double-digit increases in healthcare costs year over year; they need solutions. Alternative benefits like ketamine and cannabis replacement therapies not only reduce the cost of both the prescription and medical plans; the health of the workforce will improve, as well as mitigate the risk of addiction and the opioid crisis.”

By adding medical cannabis as a benefit, CannaCoverage and F.E.M.’s municipal partners report both a direct decrease in healthcare costs and a mitigation of the less-obvious but often more costly consequences for employers and employees of absenteeism, presenteeism, and retention.

This is a historic and national first: an employer outside the cannabis industry making medical cannabis accessible as an employee benefit. However, Santos and Lardieri went even further; in a 2024 partnership announcement, Santos described employers becoming receptive to adding ketamine-assisted therapy (KAT) to existing plans and argued it is “time to eliminate patients paying for medicine out of their own pocket.” 

Lardieri’s emphasis was on sequencing: use the current legality of ketamine to build coverage infrastructure now, “we can bring already-legal ketamine therapy to people today, and then apply that benefits pathway to future entheogenic medicines as regulatory gates open.”

How Psychedelic Care Becomes a “Benefit”

Cannabis shows how employers can broaden access when traditional coverage lags. The next step is the infrastructure layer that turns a complex care model into something plans can administer.

A notable signal at PhilaDelic was the emergence of companies positioning themselves as infrastructure: entities that translate between clinical models, employer plans, and coverage policy.

Sherry Rais, CEO of Enthea, described the role plainly: “We are basically the bridge between insurance companies and drug developers.” Enthea’s niche is benefits administration: helping employers offer a defined KAT benefit with contracted providers, program rules, and an administrative pathway that looks and behaves like a benefit rather than a one-off expense.

Rekha Philip, chief of staff at Journey Clinical, described a different piece of the same access puzzle: clinical enablement at the provider level. Journey Clinical works with large numbers of therapists and practices to operationalize KAT, including medical oversight, training, and workflows, so KAT can be delivered in ordinary outpatient settings rather than just boutique clinics. Philip summarized the footprint this way: “We are trying to make it as accessible as possible where we can. Right now, we have insurance coverage for our ketamine medical appointments, across sixteen states, with eleven different insurance companies.”

Together, these companies illustrate where the market is heading:

• CannaCoverage / F.E.M.: benefits design andimplementation for public & private sector employers to enhance the existing plan design
• Enthea: benefit administration (making a therapy package purchasable as a plan benefit
• Journey Clinical: provider enablement and clinical operations (making delivery feasible in routine practice)

It is progress; however, it is still fragmented. Coverage for medical appointments in certain states is not the same as comprehensive coverage for the full course of care. Patients still face variation in networks, prior authorization, and cost-sharing. Clinicians still face uncertainty about which components will be reimbursed reliably. The field lacks uniform standards, so those forging ahead are often doing so alone.

If ketamine exposes why coverage breaks and cannabis shows how benefits design can widen access, ibogaine is the stress test of the same thesis. Higher acuity, tighter monitoring expectations, and more perceived risk mean that reimbursement and infrastructure must be airtight. Without standardized delivery pathways, the question is not simply “does it work?” but “who can safely offer it, under what protocols, and how would any payer justify paying for it?”

Ibogaine Raises the Stakes

Ibogaine pushes the coverage conversation into public view because it forces the system to confront the full package—screening, monitoring, aftercare, and risk management—rather than treating the intervention as a simple prescription. Ibogaine advocate W. Bryan Hubbard painted a picture of the “unparalleled potential for ibogaine treatment of opioid use disorder [and] co-occurring substance use disorder.” 

But potential is not coverage. For high-intensity therapies, payers and employers will ask for the same things they ask of every new benefit: namely, clear protocols, defined eligibility, credible outcome tracking, and a delivery model that can be audited and scaled.

That is why Texas matters. The state’s visible investment is a signal that some governments may be willing to fund the evidence base and build the delivery apparatus that payers typically demand before coverage follows. In other words: when the infrastructure comes first, reimbursement becomes possible; when it does not, even the most compelling therapies remain trapped behind cash-pay access and fragmented pilots.

What Lies Ahead for Coverage?

Infrastructure is being built now, in parallel with the growing legislative and clinical urgency around psychedelics more broadly. In the next few years, anticipate: more plans covering care time, not only the medication; protocols and documentation standards that reduce payer uncertainty; network expansion beyond early adopters into mainstream employers and insurers; outcomes reporting that medical directors treat as credible and decision-relevant; and finally, clearer regulatory pathways that allow stable medical policies.

PhilaDelic 2025 showed the field’s ambition. The next phase is administrative and economic. That is where access will be decided: psychedelic medicine must either widen into a public-health intervention or narrow into a luxury service. At PhilaDelic 2025, we chose to bet on psychedelics becoming the accessible, affordable medication patients need; we bet that access to psychedelic medicine will transform healthcare.  

This article is from an external, unpaid contributor. It does not represent High Times’ reporting and has not been edited for content or accuracy.