The proposed new Medicare billing codes in the proposed Physician Fee Schedule (PFS) for 2025 include three specific codes for digital mental health treatment (DMHT) relating to professional services involving DMHT devices. This is the first time CMS has proposed Medicare reimbursable codes specific to digital therapeutic products through the physician services benefit.
Under the proposal from CMS, covered products must have FDA clearance. This distinction is crucial as it differentiates general wellness apps and DMHT devices that have proven efficacy and safety. When someone searches for “insomnia” or “anxiety” in an app store, they will find hundreds, if not thousands, of apps.
However, most of these apps have not submitted evidence for FDA review to support their effectiveness. FDA clearance ensures a product has undergone rigorous testing and validation, providing assurance of its therapeutic benefits.
Additionally, DMHT devices must be furnished “incident to” a qualified practitioner’s professional services via a prescription or order in association with ongoing treatment under a plan of care – and patients can use DMHT devices at home, in an office or in other outpatient settings (if that is how the device has been cleared by the FDA).
The codes encompass several key components: supply of the DMHT device, the initial education and onboarding of the patient, 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 get a deep 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 key collaborator with Lindus Health.
Q. What are digital mental health treatments?
A. Under the proposed PFS, CMS states that DMHT devices include “the term ‘digital CBT’ we used in prior rulemaking and in general to refer to software devices cleared by the Food and Drug Administration that are intended to treat or alleviate a mental health condition, in conjunction with ongoing behavioral healthcare treatment under a behavioral health treatment plan of care, by generating and delivering a mental health treatment intervention that has a demonstrable positive therapeutic impact on a patient’s health.”
CMS goes on to state “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 term behavioral health conditions and mental disorders interchangeably and to mean psychiatric disorders as referenced in FDA regulation, 21 CFR 882.5801.”
The Digital Therapeutics Alliance will be requesting clarification from CMS regarding 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 services available to patients in the United States. The only solution in many cases is digital therapeutics. These codes, if finalized, will expand access for Medicare patients to much needed mental health services.
Medicare is a trend setter. By legitimizing these treatments within the Medicare system, it sets a precedent for other insurers to follow suit, potentially transforming the landscape of mental healthcare delivery.
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 therapeutics and steps for broader reimbursement and adoption?
A. The future of digital therapeutics is incredibly promising. There has been a significant global adoption of digital therapeutics, with clear payment pathways established in countries such as Germany, France and South Korea. It’s exciting to see the U.S. begin to cover these innovative products.
For the Digital Therapeutics Alliance, our immediate next step is to collaborate 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 engage 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 remains committed to advocating 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 within mental healthcare reform and digital health innovation?
A. This proposal fits within mental healthcare reform and digital health innovation by:
- Reducing stigma. Making mental health treatments more accessible in the patient’s home environment and integrating these treatments into everyday healthcare can help reduce the stigma associated with seeking mental healthcare.
- Addressing gaps in care. Access to mental healthcare can be challenging with shortages, especially in rural, underserved communities. DMHTs are poised to address these challenges in mental health.
- Promoting innovation. The recognition and reimbursement of digital therapeutics by Medicare can attract more investment into health tech startups focused on developing innovative solutions. By embracing digital health technologies, the proposal supports ongoing innovation and the development of new, effective treatment modalities.
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