Confronting problems in the Medicare program remains a high priority for the Practice Directorate. In fact, hardly a year has passed since 1989, when psychologists were first included as independent providers in Medicare, that some element of the program did not need attention to assure access to psychological services that was intended when psychologists were added to the program. Removing unnecessary requirements for physician supervision of psychologists’ services, extending access from outpatients to inpatients and fairly valuing services provided by psychologists (for example, psychological and neuropsychological testing) are just a few of the areas where we have focused our attention.

But perhaps the most important activity for preserving the program’s integrity is our ongoing work to assure that Medicare commits sufficient resources to psychological services. While we have made progress in achieving parity in coverage for mental health services in portions of the private insurance market, the same is not true of Medicare. Including psychologists as full Medicare providers and then placing arbitrary limits on the extent to which their services are covered by comparison to physician services (health and behavior services are the only exception) seems to be less than “full” inclusion of psychological services. The latest round of Medicare reimbursement cuts provides more instances of placing mental health service providers at an unfair disadvantage. In addition to the scheduled 5 percent rate cut for all provider services, which was fortunately turned back by the last Congress just before it adjourned, the Centers for Medicare and Medicaid Services (CMS) has used its regulatory powers to implement yet another cut. This 9 percent cut is intended to offset an increase in dollars committed to support evaluation and management (E&M) services. The change was triggered by the former head of CMS, Dr. Mark McClellan, in an effort to encourage the provision of more E&M services, which he believed would enable Medicare providers to spend more time interacting with patients. E&M services involve functions such as establishing diagnosis and treatment options, and providing inpatient and outpatient consultation services. Unfortunately, CMS does not allow most non-physicians, including psychologists, to use the codes for E&M services.

The Practice Directorate has argued to CMS for years that psychologists are indeed well qualified to provide an array of E&M services. Yet the federal agency has simply been intractable on this issue. Litigation to force a change in CMS policy has been explored, but sufficient legal grounds to sustain a successful lawsuit were found lacking.

Legislation to direct CMS to make the change could solve the problem although, until recently, there was little congressional interest. Finally, some members have begun to appreciate the injustice in decreasing dollars to support psychological services to offset increasing dollars for E&M services. These legislators realize that psychologists in essence are being required to finance Medicare services that they are excluded from providing. As a result of growing congressional interest, CMS has agreed to meet with us to discuss the problem. The Practice Directorate will continue to press for psychologists’ access to the E&M codes, while also asserting that reimbursement for psychological services should not be cut. One additional recent Medicare issue results from the newly created 1.5 percent bonus-incentive payment for providers who report certain quality measures, a provision included in the legislation that negated the 5 percent rate cut. Inclusion of this provision was virtually assured early in the legislative debate when organized medicine supported the “pay for reporting” scheme in return for Congress blocking the rate cut. According to the law, the quality measures to be used come from the CMS Physician Voluntary Reporting Program (PVRP), which includes physician quality measures but no non-physician measures.

Importantly, the physician measures are extremely basic process-oriented measures, such as whether certain screenings are conducted, certain symptoms evaluated or specific tests performed. The Practice Directorate will be working to see that any measures used for psychologists are similarly basic process-oriented measures that are not onerous to incorporate into routine practice. Additionally, we will closely monitor CMS’s activity as this “pay for reporting” program evolves. While it is not unreasonable to expect psychologists, along with physicians, in Medicare to demonstrate that they are providing good quality care, it is a slippery slope from that point to the application of “pay for performance” measures motivated by economics rather than true patient care. Continuing to work to fix these problems with Medicare is critical for two reasons. First, only when beneficiaries have access to the psychological services they need can we have a strong Medicare program. Second, it is oftentimes true that as goes the Medicare program, so goes the benefits structure in the private market.