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By Lauren Muhlheim, Psy.D., CEDS and Kantor & Kantor, LLP, LLP

Unbeknownst to most mental health consumers, a change went into effect in January, 2013 that may have far-reaching ramifications for those receiving outpatient psychotherapy. For the first time in 15 years, changes were made to the coding system used to describe and bill for mental health treatment. This change has resulted in chaos for many mental health professionals who bill their patients’ insurance. Nationwide, many mental health providers have reported problems with filing and receiving timely reimbursement for claims filed under the new coding system.

Why were the Current Procedural Terminology (CPT) codes changed? The Centers for Medicare and Medicaid Services (CMS) establishes the Current Procedural Terminology (CPT) codes that providers use to communicate with insurance companies. The CPT codes are periodically reviewed in partnership with the American Medical Association (AMA). For the last several years, the AMA and the American Psychiatric Association (APA) advocated for changes in the codes that would treat (and reimburse) psychiatrists like other physicians. Psychiatrists have traditionally been on the low rung of physician pay scales. The changes allow (and now require) psychiatrists to bill separately for the different services they frequently provide in the course of a single session (medical examination, psychotherapy, and medication management). The hope was that the new codes, in providing more flexibility in session length, would highlight the complexity and diversity of what psychiatrists do. There are additional “add on” codes for “complexity” as well as for crisis management. Since all mental health providers use the same psychotherapy codes, non-psychiatrists have had to adopt these as well.

For the majority of recent psychological treatment history, the standard 50- minute therapy session was billed to insurance under the CPT code “90806,” and was officially described as “individual therapy 45-50 min.” In practice, most therapists have scheduled patients on the hour and allocated one hour per patient, spending approximately 50 minutes face to face. This often stretches to 55 minutes by the time one handles payments and schedules the next appointment and allows a few minutes between clients for notes, bathroom breaks, and checking messages. In 2013, the 90806 code was eliminated and replaced with several alternatives:

• 90832 – psychotherapy 30 minutes
• 90834 – psychotherapy 45 minutes
• 90837 – psychotherapy 60 minutes

Practitioners were informed about the change in October 2012, but given little specific information on how to use them. The American Psychiatric Association provided the following interpretation:

Note: Since the new psychotherapy codes are not for a range of time, like the old ones, but for a specific time, the CPT “time rule” applies. If the time is more than half the time of the code (i.e., for 90832 this would be 16 minutes) then that code can be used. For up to 37 minutes you would use the 30 minute code; for 38 to 52 minutes, you would use the 45-minute code, 90834; and for 53 minutes and beyond, you would use 90837, the 60-minute code.

By “time,” the APA means face-to-face time with the client.

So what’s the hitch? The 50-minute session suddenly no longer exists, and that creates a problem. Many practitioners assume the 45-minute session is the intended replacement for the 50-minute session. However, they fear that reducing time spent with patients will both reduce treatment efficacy, and be used as justification by insurance companies to reduce reimbursement rates. Remember, reimbursement rates haven’t been raised in 18 years and are typically only half of what a patient would pay if they didn’t have insurance. The other option, the 60-minute session, makes it harder for therapists to complete paperwork and take bathroom breaks unless they space clients further apart, complicating schedules for everyone involved. And it’s not even clear whether insurers will choose to cover the 60-minute session. It appears that some insurers will not.

For psychiatrists, the new codes are extremely complicated. The 2013 Medicare fee schedule reveals that reimbursement for psychiatric evaluations with medical services – those done by psychiatrists – will be lower than reimbursements for psychiatric evaluations done by social workers and psychologists. “This makes no sense, and seems to run counter to the premise that creating a comprehensive system of coding services would create an appreciation for the complexity of the medical aspects of treating mental disorders, address parity, and decrease the stigma to seeing a psychiatrist.”¹

The CPT changes have thus far resulted in confusion and delays in processing mental health claims because insurance companies were not prepared, equipped, or organized for this change. Insurance companies had not yet set rates for the new codes, nor had they decided which codes they would accept. As a result, claim processing since the first of the year has been slow, impacting patients, therapists, and insurance companies. Helen Stojic, a spokeswoman for Blue Cross Blue Shield of Michigan told NBC News, “The amount of changes and the work involved was much bigger than … the folks involved anticipated.”²

Around the country, mental health providers have reported problems with insurance reimbursement. Some are reporting financial difficulty due to the delay in cash flow. The biggest worry, however, is that this coding chaos will affect care for millions of vulnerable patients.

What does this mean for providers? In simple terms, less pay, delayed payment, and financial hardship. “We are ethically bound not to leave patients hanging,” Steven Perlow, president of the Georgia Psychological Association and a psychologist in private practice said. “I will personally see people for a sliding scale … there have been situations where I’ve seen people for free.”³ Additionally, providers may experience disincentives to stay on insurance panels. Lastly, these factors may affect providers’ ability to deliver quality care.

What does this mean for patients? To start with, session lengths could be reduced by 10%, meaning less treatment. Furthermore, patients may have increased difficulty finding practitioners who are willing to accept insurance. Therapists may very well be waiting to see what is happening with reimbursement rates before accepting more insurance patients, or may leave panels altogether.
These outright denials of payment and system wide delays have caused chaos among providers and their patients, and could last for months. This disorder and confusion has the potential to jeopardize access to care for millions of mentally ill Americans, who depend upon the stability of treatment from their mental health providers.

Action Plan…

If you feel that the 2013 psychotherapy CPT codes have negatively affected how you are able to deliver or receive patient care, let your voice be heard:
• Here is a link to an on-line petition to include insurance companies in anti-trust laws and reimburse providers at fair rates:
• Contact your congressional representatives and let them know how these changes are negatively affecting patient care.

Lauren Muhlheim, Psy.D., CEDS
Lauren Muhlheim, Psy.D., CEDS is a psychologist and certified eating disorder specialist practicing in Los Angeles. She specializes in providing evidence-based psychotherapy for adults and adolescents.

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