In this study, a novel multiscale material model is proposed to simulate the elasto-plastic damage-healing behavior of an epoxy matrix in a composite material. This framework combines the non-linear mean field homogenization methodologies with the continuum damage-healing mechanics to achieve the healing process in a coupled manner along with the damage. The model is able to predict the time dependent healing effect combined with damage propagation. In the proposed multiscale model, the healing depends on the current damage of the matrix, the available time that the healing can evolve and the rate of healing. A parametric study with respect to the rate of healing and a time dependency analysis were performed to examine the sensitivity of the model. In addition, a microscale method to calculate the healing initiation and healing efficiency is proposed using a representative volume element of an epoxy matrix with healing microcapsules. The microscale simulation showed that with 7.5% volume fraction of microcapsules 40% of the structural integrity can be recovered.