Date: December 03, 2013
To:
SPTA and Division Federal Advocacy Coordinators, APAPO Board of Directors, and
APAGS Coordinators
From: Doug Walter, J.D., Acting Associate Executive Director for Government Relations,
American Psychological Association Practice Organization
Cc:
Katherine Nordal, Ph.D., Executive Director for Professional Practice
Re:
Medicare boosts payment for most psychology codes in final rule on the
2014 fee schedule
The Centers for Medicare and Medicaid Services (CMS) released on November 27 the final
rule on the 2014 Medicare physician fee schedule, which includes important information for
psychologists who treat Medicare patients. We are pleased to inform you that, as CMS
reports, “The 2014 payment rates increase payments for many medical specialties with some
of the greatest increases going to providers of mental health services including psychiatry,
clinical psychologists and clinical social workers.” In fact, psychologists are listed as having
the second largest increase in allowed charges, with a combined increase across all billed
services of approximately 8%.
The good news for psychology is by virtue of APAPO’s work on psychotherapy with the
AMA RVS Update Committee (RUC) process. CMS recognized the greater complexity
involved in providing psychotherapy and will assign higher work values for the
psychotherapy codes in 2014. As a result, with the exception of the diagnostic evaluation
(90971), 30-minute psychotherapy (90832), and multiple family group psychotherapy
(90849), all of the psychotherapy codes will receive payment boosts, some significant. The
higher work values are the result of concerted efforts on the part of APAPO to ensure more
appropriate valuation of psychotherapy services through the RUC process, and to raise both
CMS’s and Congress’s awareness of the problems with the Medicare payment formula which
have led to a substantial decline in mental health payments in the program, particularly since
2007.
Beyond psychotherapy psychologists will see additional gains but also some losses for other
services. On the plus side there will be a boost to the health and behavior codes (96150 –
96155) of approximately 1.5%. The testing and assessment codes, however, will vary with
some paying more and others paying less. The changes to specific testing codes are
discussed below.
Based on our preliminary examination of the final rule, which does not include the actual
payment amounts because they vary by geographic area, we estimate the following changes
to the psychotherapy codes in 2014:
Psychiatric diagnostic evaluation (90791)
30-minute psychotherapy (90832)
45-minute psychotherapy (90834)
60-minute psychotherapy (90837)
Psychoanalysis (90845)
Family psychotherapy w/o patient (90846)
Family psychotherapy w/ patient (90847)
Multiple family group psychotherapy (90849)
Group psychotherapy (90853)
Interactive complexity add-on (90875)
-15.5%
-1.5
1.5
3.5
17
34
15.5
-4
3
185
For the testing codes, the largest increases will be for neuropsychological testing (+3% for
96118) and neuropsychological testing by a technician (+4% for 96119). The largest
decreases will be to the two codes for testing by computer with a loss of 38% for 96103 and
55% for 96120. Psychological testing by a technician (96102) will lose 28% while
psychological testing (96101) will decline by 7%. The losses to the testing codes are due to
changes by CMS in practice expense.
The Medicare payment formula consists of three components that represent work (cognitive
effort and intensity), practice expense (overhead), and malpractice expense. Different values
assigned to each component are combined and then multiplied by a yearly conversion factor
to establish a payment amount for each service. All services are valued relative to one
another.
Most of the psychotherapy codes received increases due to an increase in work value and a
greater weighting in work compared to practice and malpractice expense. In our September
9th Information Alert we cautioned psychologists that changes in the amounts allowed for
practice (overhead) expenses for psychotherapy codes would likely result in lower payment
rates for some primary services in 2014. Indeed, this occurred for the psychiatric diagnostic
evaluation, due to a decline in the clinical labor component of the service, and the
psychological testing codes.
Throughout the summer and fall APAPO met with CMS and key members of Congress
urging action to avert lower psychotherapy payment rates. APAPO also submitted
comments to CMS on the proposed physician fee schedule rule and comments to
Congressional health committees as they look to reform the Medicare payment system on the
need to take action to prevent lower payment rates for psychologists’ services. We believe
that psychology’s voice has been heard, and that while changes to practice expense were
made, upward adjustments to and a greater weighting of work combined to avoid payment
reductions for most services.
While we have gained some increases this year, there is much work still to be done.
Psychologists’ Medicare payments have drastically declined, particularly since 2007. We
must keep the drumbeat going with CMS and Congress that the Medicare payment formula
must be reexamined to provide adequate and appropriate reimbursement for psychological
services into the future. Your constituent meetings and communications will ensure this
message is heard.
The psychiatric diagnostic evaluation, for example, will experience another large payment
decrease in 2014. This is unacceptable. We will continue work with CMS and call on
Congress to ensure appropriate payment for this and the other services that psychologists
provide to Medicare beneficiaries.
Again this year, Congress must act to divert the 24.4% Sustainable Growth Rate (SGR) cut
from taking place on January 1st. The payment rate changes for the services referenced
above do not include the impact of the SGR. On November 21st we sent you an Action Alert
asking you to contact your Senators and Representatives to vote to permanently repeal the
SGR.
Thank you for making these contacts. With only a few legislative days left in this Congress,
we will continue to urge your action and will keep you updated on the status of the SGR.