New APA office sharpens focus on health care financing

Efforts will focus on inclusion and reimbursement of psychologists in the health care system.

By Randy Phelps, PhD

In January, APA launched its new Center for Psychology and Health under the direction of Chief Executive Officer Norman Anderson, PhD. One component of the center is a new Office of Health Care Financing, which we are currently setting up under my direction. This article elaborates on the brief member introduction to this office provided earlier this year in the APA Access e-newsletter and describes in greater detail our national policy activities related to health care financing.

As Anderson has indicated in a number of venues, the purpose of the new APA Center for Psychology and Health is to vigorously pursue Goal Two of APA’s Strategic Plan: expand psychology’s role in advancing health. The center pulls together top leadership, staff and major initiatives across all of APA to focus the association’s efforts on four inter-related challenges outlined by Anderson toward achieving this goal: 

  • Workforce, education and training challenges; 

  • Influencing how we are viewed by policy makers, the scientific community, other disciplines and the public; 

  • Addressing how we view and define ourselves; and 

  • The “getting included, getting paid” challenge.

There is, and has been, a tremendous amount of work by APA on each of these challenges. 

The “getting included — getting paid” challenge relates to ongoing advocacy by the APA Practice Organization (APAPO) to legislatively define psychologists as physicians in Medicare, gain inclusion of psychologists in state Medicaid systems and legally challenge inappropriate insurance practices and parity violations. The new Office for Health Care Financing (OHCF) was created to augment those efforts, and will work in close partnership withAPA Executive Director for Professional Practice Katherine C. Nordal, PhD and APAPO, although the new office will be housed in APA’s Executive Office.

Getting included as providers in all primary care and integrated care settings, playing a key role in inter-professional treatment teams, and participating in accountable care organizations and similar entities are all necessary, but not sufficient, steps to ensuring our future. If you (or your institution) are not being reimbursed for your services in the existing fee-for-service system or in the newer care delivery models, you are at risk of being replaced by those who are reimbursable, or by lower cost providers.

AMA Strategy

Our strategy is to directly target this issue in the most critical national venues where financing policies and mechanisms are translated into actual reimbursement realities. The American Medical Association is one of those venues, so a primary activity of the new OHCF for the immediate future is to coordinate and expand APA’s involvement with the American Medical Association.

AMA processes play a very direct and powerful role in shaping this country’s health care financing policies and provider reimbursement levels — in both the public sector and the private health care market. The Center for Medicare and Medicaid Services (CMS) uses the AMA’s recommendations to set the fees paid in Medicare. These Medicare fees become the benchmark for reimbursements in other federal programs such as TriCare (Department of Defense) and Medicaid and, very importantly, the commercial insurance market.

So how does the AMA influence the public and private reimbursement system throughout the country? The AMA owns and runs the confidential and proprietary process through which all health care procedures in the U.S. are described and then assigned a billing code (which is then used for reimbursement in virtually all payment systems), known as the Current Procedural Terminology (CPT®) system.

APA is a player at the AMA CPT Committee, and was represented there by Antonio Puente, PhD from 1994 to 2008. In 2009, Puente became the first psychologist elected as a voting member of its governing body, the AMA CPT Editorial Panel. Since then, Neil Pliskin, PhD, has represented APA at CPT.

The AMA also owns and controls the highly confidential process by which “work values” are determined for all CPT codes, that is, for all health care procedures from surgery to psychotherapy and beyond. That committee is known as the Resource-Based Relative Value Update Committee or “RUC.” Jim Georgoulakis, PhD, is the APA representative to the AMA RUC, a seat he has held for a decade and a half.

So the AMA defines the procedure codes used by all health care providers, including psychologists, and also assigns a valuation (“RVU”) to each procedure. CMS bases its fees on the RVU recommendations of the AMA, so this is where “value” translates to reimbursement dollars. Commercial carriers and other federal programs then use the CMS fee schedule as a benchmark in setting their rates.

APA’s Game Plan

APA has been a player for many years at the AMA CPT and RUC through our volunteer representatives. But with pressures to transform the health care system accelerated by the Affordable Care Act, it is critical for APA to kick its CPT and RUC involvement up a notch to be at the table even more actively. And while these processes are central to maintaining the existing fee-for-service (FFS) system in health care, the move to newer financing models such as bundling and global payments will still rely on current fees as the building blocks to value the contribution of individual team members. So psychology cannot afford to neglect this arena for both the present and the future.

To that end, we are working very intensively at the CPT and RUC with Puente, Georgoulakis and Pliskin on issues that affect both mental health services by psychologists and the delivery of psychological services in physical health and integrated care settings. The immediate priorities of the OHCF in each of those two domains are:

Mental health codes
  • Completion of the AMA RUC survey process for the three remaining CPT codes in the new mental health CPT code set that went into effect Jan. 1, 2013 for the entire public and private mental health system. CMS is using an interim fee schedule and will not release its final fees for all mental health codes until all work related to the surveys is completed. 

  • Work with the AMA and the other mental health societies to develop an “extended service” psychotherapy code for trauma, PTSD and other treatments that extend beyond 60-minute sessions, because there is no code available in the new mental health code set.

Codes for integrated care
  • Advocate with CMS for permission to re-survey (through the RUC system) the existing Health and Behavior CPT codes, used for psychological treatments associated with physical disorders. Those codes are currently valued at 30-40 percent below the comparable mental health codes.

  • Participate in the AMA’s ongoing development of reimbursement codes for care coordination, transitional care and team conferences. Psychologists are currently not reimbursable for these activities. Although we have initiated related discussions with AMA, we are not yet at the AMA table where the codes are being developed.

Current procedural terminology (CPT®) copyright 2011 American Medical Association. All Rights Reserved.