Insurers in New York state and at least one large insurer in Massachusetts will now be reimbursing psychiatrists for evaluation and management (E/M) codes that many insurers have restricted psychiatrists from using.

Psychiatrists along with staff in APA's Office of Healthcare Systems and Financing (OHSF) said that the move marks an important change recognizing that psychiatrists today offer services that are more varied and complex than those reflected in the psychotherapy with E/M codes (the 908 codes)—the only E/M codes that most insurers reimburse psychiatrists for using.

In an October 26 letter to all insurers in New York, State Superintendent of the Office of Insurance James Wrynn told insurers they must accept and process all health care claims with E/M codes submitted by psychiatrists and "may not limit the types of CPT codes that [they accept] from psychiatrists to the codes specifically designated as ‘psychiatric’ in the AMA's CPT codes reporting guidelines and conventions."

In the letter, Wrynn stated that the office has become aware that "certain insurers refuse to accept and initiate the processing of E/M CPT codes when psychiatrists or other physicians submit those codes for the treatment of a mental, nervous, or emotional disorder or ailment." He added that insurers who do so are in violation of state law.

"Because psychiatrists are physicians, an insurer must accept and initiate processing of all health care claims submitted by a psychiatrist pursuant to, and consistent with, the current version of the AMA's CPT codes, reporting guidelines, and conventions," Wrynn wrote. "Accordingly, an insurer that refuses to accept or initiate processing of an E/M CPT code submitted by a psychiatrist violates insurance law."

Staff in APA's OHSF said that the decision is a significant one that other states should model. OHSF will be writing to insurance commissioners in all of the states informing them of the New York directive and requesting them to send out a similar letter if necessary.

"As physicians, psychiatrists have access to the general medical CPT E/M codes (99201-99499) when these codes appropriately describe the patient care they've provided," Ellen Jaffe, Medicare specialist with OHSF, told Psychiatric News. "The E/M codes are generic in the sense that they are intended to be used by all physicians, nurse practitioners, and physician assistants, and to be used in primary and specialty care alike. The decision to use one set of codes over another should be based on which code most accurately describes the services provided to the patient. The E/M codes give psychiatrists flexibility for reporting their services when the service provided is more medically oriented or when counseling and coordination of care are being provided more than psychotherapy."

The decision in New York was preceded by a similar one by Blue Cross/Blue Shield (BCBS) of Massachusetts in August. The new policy went into effect in September.

"We think this is momentous," Greg Harris, M.D., chair of the Committee on Managed Care of the Massachusetts Psychiatric Society (MPS), told Psychiatric News. "We have been working on this for a lot of years."

Harris, who is also a member of APA's Council on Healthcare Systems and Financing, said that psychiatric practice has evolved in such a way that the services clinicians provide today to medically complicated patients no longer fit neatly into either psychotherapy or medical management, the service categories traditionally used by psychiatrists.

Harris said use of the generic E/M codes allows for a more fluid approach to coding that better reflects the diverse services psychiatrists provide. "There are people for whom you are doing traditional psychotherapy, and there are patients for whom you are doing more medical-type evaluation and management services that are not strictly medication management," he said.

For example, a psychiatrist may be seeing a patient with bipolar disorder and advising the patient about all manner of issues related to general medical health without necessarily strictly managing psychiatric medications, he explained.

"We have argued that restricting us to the psychotherapy codes is discriminatory because it limits the scope of practice [to either psychotherapy or medication management]," he said. "And it is discriminatory because the restriction hasn't applied to other physicians. So we have argued for this as a matter of parity."

Harris added that MPS leaders hope to use the BCBS decision, as well as that by the New York State Office of Insurance, as a model for all insurers in Massachusetts to follow.