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CMS Proposes Cuts To Mental Health Services Reimbursement

us_capitolAs you know, the Centers for Medicare and Medicaid Services (CMS) recently published its proposed rule on the 2011 Medicare fee schedule, and our regulatory team has completed an analysis of the lengthy and complex regulation. In addition to reflecting an expected cut to all services as a result of the Sustainable Growth Rate (SGR) formula and changes to the Physician Quality Reporting Initiative (PQRI) payments, the rule would significantly negatively impact psychological and other mental health services due to revisions to the medical economic index (MEI).

Specifically, CMS is proposing to “rebase” the MEI by linking it to data from the 2006 physician practice survey and “revise” it by making changes to nine expense categories such as medical equipment, chemicals, materials and supplies. The changes would result in an increase in practice expense values. However, because the agency is required to remain budget neutral in its rulemaking, CMS would impose a 4% across the board reduction to the work component for all services. CMS would not change the work values assigned to each code but instead lower the payment by reducing the conversion factor that the work value is multiplied by. The net result is that work-intensive specialties would see a decrease, while practice expense-intensive specialties would see an increase.

Psychologists and social workers would experience the deepest projected average cut of 5% because mental health services are most heavily weighted toward work values. Psychiatrists, emergency medicine doctors, and anesthesiologists would each face a 3% cut. Radiation therapy centers (+8%), portable x-ray suppliers (+6%) and diagnostic imaging centers (+6%) would see the greatest increases because of their reliance on costly technology and overhead. In addition, psychology and social work are already scheduled to receive an additional 2% cut due to the second year implementation of 2009 practice expense adjustments, through which practice expense was also increased at the expense of mental health and other work-intensive specialties.

CMS has repeatedly made changes to Medicare formularies that have significantly devalued and reduced reimbursement for the time and expertise of health care professionals. It is simply wrong for CMS to continually cut reimbursement for cost-effective services to boost payment for expensive equipment and overhead that are driving the inflation of health care costs. Patients and providers cannot afford for the federal government to fail to address this recurring problem. CMS must recognize the disproportionate impact of such changes in its rulemaking. If CMS refuses to do so, Congress must step in and require it.

The APA Practice Organization is currently preparing a strong comment letter in response and is also reaching out to other affected providers and our allies on Capitol Hill. We will keep you posted as the situation develops and your grassroots support is needed in the months ahead.

Jeff Cook, J.D.
Director of Field & State Operations
American Psychological Association Practice Organization
750 First Street, NE Washington, DC 20002
(202) 336-5875 (Office)
(202) 336-5797 (Fax) (click to verify and reveal email)

Republished with permission: APAPO

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One Response to CMS Proposes Cuts To Mental Health Services Reimbursement

  1. avatar
    Taylor Parker July 24, 2012 at 10:51 AM #

    I’ve been thinking about pursuing a degree in the medical field, but even though I don’t mind investing a nice size amount of time on my education, I don’t want to go to medical school and spend eight or more years pursuing a particular education. I would be more than satisfied with a four year degree job. What kind of degree do you have to have to work in diagnostic imaging centers ? How many hours a week do they work, and what kind of hours during the day do they have to work?

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