On Dec. 15, President Barack Obama signed The Medicare and Medicaid Extenders Act of 2010 (H.R. 4994), halting the 25 percent Sustainable Growth Rate (SGR) cut through the end of 2011.
The Medicare SGR payment formula ties Medicare payment to providers to factors related to the economy. In recent years, the formula would have automatically cut most provider payments if Congress had not postponed the scheduled payment cuts. The 5 percent provision is a restoration from a previous cut. In 2007, psychologists’ and other health-care providers’ reimbursement was cut by 7 percent, but Congress restored 5 percent of that cut. Under the new law, that restoration is extended until the end of 2011 when the Centers for Medicare and Medicaid Services (CMS) will make a decision on the valuation of the code that was cut in 2007.
Since there is a backlog of claims, the bill also provides financial resources to CMS to process payments for claims bottlenecked since Jan. 1, 2010.
The American Psychological Association Practice Organization (APAPO) has been advocating for 5 percent psychotherapy payment restoration since 2007, when Medicare increased payments for physician office visits involving evaluation and management (E&M) services — such as physical examinations, evaluations of comorbid conditions and drug management. APAPO successfully argued that since psychologists cannot bill for E&M services, the 5 percent taken from psychotherapy services to increase payment for E&M services should be restored. Congress originally granted the psychotherapy payment restoration from mid-2008 to the end of 2010.
Medicare reimbursement and psychologist payment issues remain top priorities for APAPO.