Professional Point

The Centers for Medicare and Medicaid Services (CMS) recently announced an expanded set of Current Procedural Terminology (CPT) codes for psychological and neuropsychological testing. These codes, combined with CMS' recognition that psychological testing is a "professional" service, mark the latest step in long-standing implementation of the 1989 statute that added psychologists to the Medicare program. Until now, Medicare considered psychological and neuropsychological testing only a "technical," not a professional service, largely because only physicians historically provided Medicare independent professional services.

The battle to make psychological services readily accessible to Medicare beneficiaries began in 1986 when the Practice Directorate's predecessor, the Assessment-funded APA Office of Professional Practice, began advocating to get psychologists recognized as independent professionals in Medicare.

With the mobilization of a new, effective grassroots advocacy effort and help from state psychological associations, Congress in 1989 amended the Medicare statute to allow psychologists to practice independently in all Medicare settings, thus broadening Medicare beneficiaries' access to needed mental health care.

But the laws that supported the country's largest publicly funded health-care program were complex, arcane and predominantly written only for physicians as independent providers. Psychology began to encounter resistance to the widespread participation envisioned when the law was amended.

First, Medicare refused to reimburse psychologists for inpatient services, stating that these services must be "bundled" into hospital payments. An APA-generated technical amendment to the statute in 1990 allowed clinical psychologists' services to be "unbundled."

Also in 1990, problems with the law's interpretation emerged when the Health Care Financing Administration (HCFA), now CMS, defined "clinical psychologist" much more narrowly than did either the profession or state licensing bodies. Only psychologists with doctoral degrees in Clinical Psychology (and not Counseling Psychology, for example) were eligible. Through regulations, the Practice Directorate remedied this problem by getting HCFA to define "clinical psychologist" broadly to include any appropriately trained health services psychologist.

In 1991, HCFA implemented the Resource-Based Relative Value Scale (RBRVS) as the basis for the Medicare Fee Schedule. The RBRVS consists of four components: "physician work," the time and effort expended by the physician performing a service; "practice expense," the related overhead costs; "professional liability," the cost of malpractice insurance; and a conversion factor, the value that CMS sets each year and uses to convert the other three indices into an overall payment level. Initially, psychotherapy services were not included in the RBRVS system (although they were eventually included) and psychological testing, although included in the RBRVS, was deemed to have no physician work value. While a clear rationale for this decision was not provided at the time, it became apparent that Medicare's historical reliance on physician services was largely responsible.

Years of advocacy by psychology directed at HCFA finally resulted in Medicare program administrators agreeing that both the program and the psychologists would be better served if psychological and neuropsychological testing were assigned a "professional work value." Yet, one final stumbling block remained. CMS pointed to testing CPT codes that did not allow for distinguishing between the service rendered by the psychologist and the service performed by a technician; only service by the psychologist could receive credit for the psychologist's time and effort and be assigned a professional work value.

To overcome this final stumbling block, the Practice Directorate and representatives of the neuropsychology and psychological assessment communities have spent the last year working with the American Medical Association, which controls the CPT codes, to develop testing CPT codes that distinguish whether a psychologist or technician renders the services, as well as whether the assessment is computerized. The resulting set of CPT codes enables the codes for services performed by a psychologist to be clearly identified and to carry a professional work value.

While there undoubtedly will be implementation issues to grapple with related to the expanded testing CPT codes, some key developments are worth underscoring. Both figuratively and literally, Medicare is recognizing the value of psychological services to a greater extent than ever before. Also, the continued growth of psychologists' ability to offer an ever-expanding array of services to Medicare beneficiaries is exactly what was envisioned when psychology was added to the Medicare law. The recent addition of the health and behavior CPT codes (which recognized psychologists' ability to provide services to individuals with no mental health diagnosis) combined with Medicare's latest recognition of the value of psychological testing underscores our profession's continued growth. More importantly, these developments provide increased opportunity for Medicare beneficiaries to get the services they need.