The proposed new Medicare payment codes in the proposed 2025 Physician Fee Schedule (PFS) include three specific codes for digital mental health therapy (DMHT) related to professional services related to DMHT devices. This is the first time CMS has proposed specific Medicare reimbursement codes for digital therapeutic products through the physician services benefit.
Under the CMS proposal, covered products would need to be FDA-approved. This distinction is important because it differentiates general health apps from DMHT devices that have been proven effective and safe. When someone searches for “insomnia” or “anxiety” in the app store, they’ll find hundreds, if not thousands, of apps.
However, most of these applications do not submit evidence for FDA review to demonstrate their effectiveness. FDA approval ensures that the product has undergone rigorous testing and validation to ensure the product’s therapeutic benefits.
Additionally, DMHT devices must be provided “contingently” on the professional services of a qualified physician through a prescription or order in conjunction with ongoing treatment according to a care plan—and patients may use DMHT devices at home, in a clinic, or in other outpatient settings (if that is how the device has been approved by the FDA).
These codes include several key components: provision of the DMHT device, initial patient education and instruction, the first 20 minutes of monthly treatment management services related to the patient’s use of the device for therapeutic purposes, and the next 20 minutes of monthly treatment management services.
And that’s just the tip of the iceberg. To get a deeper understanding of these proposed new codes for digital mental health treatment, Healthcare IT News sat down with Andy Molnar, CEO of the Digital Therapeutics Alliance, an organization working to advance the clinical development of digital therapeutics and a key collaborator with Lindus Health.
Q. What is digital mental health therapy?
ONE. Under the proposed PFS, CMS stated that DMHT devices include “the term ‘digital CBT’ that we used in previous rulemakings and that generally refers 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 according to a behavioral health care plan, by creating and delivering a mental health treatment intervention that has a demonstrable positive therapeutic impact on a patient’s well-being.”
CMS goes on to state, “The Diagnostic and Statistical Manual of Mental Disorders-5 (DSM) does not refer to mental disorders but rather to psychiatric disorders. In this section, in accordance with the DSM, we use the terms behavioral health condition and mental disorder interchangeably and to mean psychiatric disorders as referenced in the 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 rules.
Q. What are the implications of Medicare’s proposed rules for digital mental health treatments?
ONE. There is a shortage of mental health services available to patients in the United States. In many cases, the only solution is digital therapy. These codes, if finalized, would expand access to much-needed mental health services for Medicare patients.
Medicare is a trendsetter. By legalizing these treatments within the Medicare system, it sets a precedent for other insurers to follow, potentially transforming the landscape of mental health care delivery.
Q. What is the potential impact on healthtech startups and the healthcare ecosystem at large?
ONE. The introduction of these payment codes is a significant opportunity. Coding, coverage, and reimbursement are critical to national access in the US. With clear payment pathways, this will lead to additional investment and innovation.
Q. What is the future of digital therapeutics and what are the steps towards wider adoption and reimbursement?
ONE. The future of digital therapeutics is incredibly promising. There has been significant global adoption of digital therapeutics, with clear payment pathways established in countries like Germany, France, and South Korea. It is exciting to see the US starting to embrace these innovative products.
For the Digital Therapeutics Alliance, our immediate next step is to work with 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 to 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 remains committed to advocating for legislation that will expand and clarify Medicaid and Medicare coverage for digital therapeutics, including S. 723 (Access to Prescription Digital Therapeutics Act) and 8816 (American Healthcare Investment and Innovation Act).
Q. How does this proposal fit into mental health reform and digital health innovation?
ONE. This proposal aligns with mental health reform and digital health innovation by:
- Reduce stigma. Making mental health treatments more accessible in patients’ homes and integrating these treatments into everyday health care can help reduce the stigma associated with seeking mental health care.
- Address gaps in care. Access to mental health care can be difficult due to shortages, especially in rural, underserved communities. DMHT is poised to address these challenges in mental health.
- Promote innovation. Medicare recognition and reimbursement for digital therapies could attract more investment in health tech startups focused on developing innovative solutions. By adopting digital health technologies, this proposal supports continued innovation and the development of new, effective treatment modalities.
Follow Bill’s HIT coverage on LinkedIn: Bill Siwicki
Email him: [email protected]
Healthcare IT News is a publication of HIMSS Media.
