Proposed new Medicare billing codes could boost digital mental health care
The proposed new Medicare billing codes in the proposed 2025 Physician Fee Schedule (PFS) include three specific digital mental health (DMHT) codes related to professional services involving DMHT devices. This is the first time CMS has proposed Medicare reimbursable codes specific to digital therapeutics products through the physician services benefit.
Under CMS’s proposal, covered products would have to have FDA approval. This distinction is crucial because it separates general wellness apps from DMHT devices that have been proven effective and safe. When someone searches an app store for “insomnia” or “anxiety,” they’ll find hundreds, if not thousands, of apps.
However, most of these apps have not submitted evidence for FDA review to support their effectiveness. FDA approval guarantees that a product has undergone rigorous testing and validation, which ensures its therapeutic benefits.
In addition, DMHT devices must be provided “incidentally” to the professional services of a qualified physician via a prescription or order in conjunction with ongoing treatment under a plan of care. Patients may use DMHT devices at home, in the office, or in other outpatient settings (if the device is FDA-approved in that manner).
The codes cover several key components: delivery of the DMHT device, initial patient education and onboarding, the first 20 minutes of monthly treatment management services related to the patient’s therapeutic use of the device, and each subsequent 20 minutes of monthly treatment management services.
And that’s just the tip of the iceberg. To gain a deep understanding of these proposed new codes for digital mental health treatment, Healthcare IT News sat with Andy Molnar, CEO of the Digital Therapeutics Alliancean organization committed to the clinical development of digital therapies and a key partner of Lindus Health.
Q. What are digital mental health treatments?
A. Under the proposed PFS, CMS includes DMHT devices as “using the term ‘digital CBT’ that we used in prior rulemaking and generally to refer to software devices approved by the Food and Drug Administration that are intended to treat or alleviate a mental health condition, in conjunction with ongoing behavioral health care treatment under a behavioral health care plan, by generating and delivering a mental health treatment intervention that has a demonstrably positive therapeutic effect on a patient’s health.”
CMS further states that “the Diagnostic and Statistical Manual of Mental Disorders-5 (DSM) does not refer to psychiatric disorders, but to mental disorders. In this section, following the DSM, we use the terms behavioral health disorders and mental disorders interchangeably and mean psychiatric disorders as listed in FDA regulation, 21 CFR 882.5801.”
The Digital Therapeutics Alliance will ask CMS for clarification on the scope of products eligible for reimbursement under the proposed DMHT codes.
Q. What are the implications of Medicare’s proposed codes for digital mental health treatments?
A. There is a shortage of mental health care for patients in the United States. The only solution in many cases is digital therapy. These codes, if they become permanent, will give Medicare patients more access to much-needed mental health care.
Medicare is a trendsetter. By legitimizing these treatments within the Medicare system, it sets a precedent for other insurers to follow suit, potentially transforming the mental health landscape.
Q. What is the potential impact on health tech startups and the broader healthcare ecosystem?
A. The introduction of these billing codes represents a significant opportunity. Coding, coverage, and reimbursement are critical to national access in the U.S. With clear payment pathways, this will lead to additional investment and innovation.
Q. What is the future of digital therapy and what steps have been taken towards broader reimbursement and acceptance?
A. The future of digital therapeutics is incredibly promising. There is significant global adoption of digital therapeutics, with clear payment pathways in countries like Germany, France, and South Korea. It is exciting to see the US start to cover these innovative products.
For the Digital Therapeutics Alliance, the next step is to work with our members to submit comments to CMS on the proposed Medicare Physician Fee Schedule.
More broadly, the Digital Therapeutics Alliance will continue to work closely with the FDA. We will also continue to work with the American Medical Association to identify and address gaps in coding and communicate the needs of the digital therapeutics industry.
The Digital Therapeutics Alliance is excited about this first step toward Medicare coverage for digital therapeutics and continues to advocate for legislation that will broaden and clarify Medicaid and Medicare coverage of digital therapeutics, including S. 723 (the Access to Prescription Digital Therapeutics Act) and 8816 (the American Medical Innovation and Investment Act).
Q. How does this proposal fit into mental health reform and digital health innovation?
A. This proposal fits within the reform of mental health care and the innovation of digital health care by:
- Reducing stigma. Making mental health care more accessible in the patient’s home environment and integrating these treatments into daily health care can reduce the stigma associated with seeking mental health care.
- Addressing gaps in care. Access to mental health care can be a challenge with shortages, especially in rural, underserved communities. DMHTs are poised to address these mental health challenges.
- Promoting innovation. Medicare’s recognition and reimbursement of digital therapies could attract more investment in health tech startups focused on developing innovative solutions. By embracing digital health technologies, the proposal supports continued innovation and the development of new, effective treatment modalities.
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