Yes.  Retouching a set number of photos is included in each session package.  Typically, that is a commercial version and a theatrical version of each look.  This is where good communication with your representation is key.  I would definitely recommend getting their input on your session photos.
Yes, most of the time, retouching is needed.  We eliminating items such as blemishes, stray hairs, dark circles and an overall cleaning up of the skin to look fresh and natural.  But remember, retouching should never be overdone.  You ALWAYS want to walk into a casting looking exactly like your headshots.
Want to know more about what exactly your headshots should look like… and how retouching should factor in…. read my blog post on it.