How Medicare will devalue the work of psychiatrists


For the first 20 years of practice, assigning a code to the services I offer has been easy. I see most patients for “90807” – a 50 minute psychotherapy session with medication management.  It all gets mushed together, a patient may talk about an upsetting event in their lives (psychotherapy) and then mention they are having trouble sleeping or a side effect to a medication (medication management), then go on to talk about their future goals (psychotherapy), and the session may end with a prescription for a refill, a new medication, or a suggestion to take make a lifestyle change (medical management).  These codes, submitted by either the patient of the doctor to third party payers allow for reimbursement for services.

For 2013, the codes that all mental health professionals use are changing.

The coding for an evaluation of a new patient is fairly simple, there is one code that includes medical services, to be used by psychiatrists, and another code to be used by social worker and psychologists.  (I’m not sure what codes get used by physician assistants or nurse practitioners).

For regular appointments, the new codes are not so simple.  For those who prescribe medications and manage medical conditions, we will be moving to the same Evaluation and Management codes that other physicians use – the 99211 to 99215 range based on the medical complexity of the problem.  These codes, as you may know, require very specific levels of documentation to determine exactly how complex a problem is.  There’s the history, the interval history, the review of systems, the exam, and the complexity of medical decision making .  But it can all be summarized below.    For the history, we need only document the following: location, quality, severity, duration, timing, context, modifying factors, associated signs and symptoms

HPI is considered “brief” if it includes 1-3 of these elements, and “extended” if it includes > 4 elements or 3 stable conditions.

To determine the actual level of care, the following chart makes this clear:

Level Of care requirements (2 out of 3 needed)
Level of Care
Problem Focused
Extended Problem Focused
Low Complexity
12 from 2 or more organ systems
Moderate Complexity
2 from each of 9 organ  systems
High Complexity

What’s nice about this method, and why it was advocated for by both the American Medical Association and the American Psychiatric Association, is that it treats psychiatrists like every other physician.  It emphasizes the medical aspects of what we do compared to other mental health professionals, differentiates our work, and highlights the complexity and diversity of what psychiatrists do.   The hope is that reimbursements will improve (psychiatrists are on a very low rung of the physician pay scales), encourage parity such that insurers will not be able to offer lower co-pays, limit appointment coverage, or have higher or separate deductibles for psychiatric care.  We also hope that by treating psychiatric appointments the same as every other medical appointment, the stigma of mental illness will disappear.

So what’s the problem?  It’s all good, right?

Well, it’s all complicated.  Many psychiatrists see patients for psychotherapy, sometimes every week, and these requirements for specific elements of the history and exam are not about offering the best possible individualized care to the patient in the room, they are about documentation for reimbursement.  And in the case of a psychotherapy patient, they take time away from the work of psychotherapy and may create an irrelevant distraction to therapy.

Under the new system, psychotherapy that occurs during a psychiatric appointment must be timed separately from medical management.  Psychotherapy is one thing, and discussions about medical issues are another.  So the psychiatrist first must determine which Evaluation and Management service he provided, document and code this, and then he must use an “add-on” code for the psychotherapy, based on time.  But even time is not a simple thing: there are 30 minute, 45 minute, and 60 minute sessions.  And if time should be clear, it’s not, a 30 minute session lasts for 16-37 minutes; a 45 minute session is 38-52 minutes, and a 60 minute session lasts for over 53 minutes.  In this new system, there are 15 possible combinations to code the old 50 minute psychotherapy session with medication management.  Unless, of course, there is a crisis intervention, a difficult family situation with a disruptive member in the session, or requirements to report a sentinel event like child abuse, in which case there are more “add-on” codes.

So what’s the problem?  It’s a little confusing, but we hope reimbursements will be better and this captures what we do and lets us be “real doctors” (was I ever not a real doctor?)

So, in some bullet points, let me share my outrage:

1. This change has all occurred very rapidly, over the past 2 months, and mental health professionals do not know how to code these new changes.  They aren’t obvious or easy to learn and multi-hour courses are being offered, but January promises to see some chaos when the wrong codes are submitted and reimbursement is denied.  This could be a problem if one has a mortgage or bills to pay.

2.  What was quite simple has now become unnecessarily complex.  Why do we need 17 different codes to describe a psychotherapy session with medication management?

3. The documentation requirements are onerous and will use time that would be better spent on meaningful patient care geared to the individual patient.

In terms of the financial aspects of the new codes:

1. Psychiatrists have contracts with insurance companies based on the CPT codes they have been using.  It is not clear that there will be time to renegotiate all these contracts with new codes by January 1st.

2. Patients will not know the cost of a session before it occurs.  And this may leave room for the patient and doctor to disagree on exactly what transpired in a session if the cost or reimbursement would change: Were 36 minutes devoted to psychotherapy or 38 minutes? It will make a difference in the fees.

3. Psychiatrists who do not participate in insurance networks typically code sessions so that the patient can get maximal reimbursement, with 15 options, and each insurer reimbursing differently, this is going to be very confusing.  And those who don’t participate charge by their time, not by the service, so this creates a whole new structure which may either lead to under-reimbursement of patients, or concerns about fraud if coding is done incorrectly.

4.  It’s all way too complicated.

With respect to Medicare, the 2013 fees were released last week and the following issues became evident regarding fees for the mid-Atlantic states:

1. A psychiatric evaluation done with medical services (so one done by a psychiatrist) is reimbursed at a substantially lower fee than a psychiatric evaluation done by someone who is not a physician.

2. The timed psychotherapy part of the appointment is reimbursed at a lower rate if medical services are also provided, even though the new codes mandate that the time appropriated for psychotherapy be distinct.  Therefore, 30 minutes of a psychiatrist’s time used for psychotherapy is reimbursed less then 30 minutes of a psychotherapy time done by someone who may have much less training.  The psychiatrist is paid more for the appointment because of the additional E/M code, but the time spent on evaluation and management must be distinct from psychotherapy, so the per-minute fees paid for psychotherapy are higher to those who don’t provide medical services.  This is especially notable for the 60 minute code, where 53 minutes of therapy, distinct from medical management, must be done. (Psychiatrists are no longer allowed to use the bathroom).

3. In theory, paying psychiatrists less than other mental health clinicians for the time devoted to psychotherapy may eliminate Medicare’s financial incentive for split therapy – the psychiatrist is now the cheapest way to obtain psychotherapy services within the Medicare network.  If psychiatrists are willing to accept these fees, other mental health professionals may find their services are no longer needed.

4. If no medical services are provided (for example, if a psychiatrist’s patient is not taking medications), then a psychiatrist can submit for the higher, non-medical psychotherapy fees, but this means the reimbursement is higher for  doing psychotherapy on less complex patients, and this makes no sense.

5. Because physicians worry about charges of fraud related to inaccurate Medicare documentation, the new and complex coding requirements are likely to cause even more psychiatrists to opt out of Medicare.  As is, Medicare patients often have trouble finding network psychiatrists to provide treatment.

6.  Medicare patients are often on fixed incomes and it seems unreasonable to tell patients that their fees may vary widely and can not be determined until the session is over.

7. Anyone who has ever done psychotherapy or been in psychotherapy knows that it’s not possible to treat a mental illness and segregate medical issues to a separate time and not discuss them during psychotherapy.  Patients talk about what is important to them, and if they are depressed, having trouble functioning, having cancer treatments, or about to have a joint replacement, this is what they talk about in therapy.  Saying that evaluation and management must be done in a time period distinct from psychotherapy is like the AMA declaring that the sky is now orange with purple polka dots.  You can say it, but it just doesn’t happen that way.

For all patients, there may a reluctance to tell the psychiatrist if they are having medically related symptoms for fear of driving the cost of the appointment up, and psychiatrists may shift the emphasis of their work so that sessions are used to question and exam patients in ways that maximize what they can charge, rather than what is in the best interest of the patients.

In short, it’s not all good, and it’s difficult to understand why our professional organizations have promoted a system with so many complexities, or why the Centers for Medicaid and Medicare Service would set fees that devalue the work of psychiatrists.

Please note you can watch a video on the new codes.

And I took the E/M chart from a blog called Psych Practice.

Dinah Miller is a psychiatrist who blogs at Shrink Rap and co-author of Shrink Rap: Three Psychiatrists Explain Their Work.


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