Psychiatrists Win Important Gains in 2024 Fee Schedule

APA’s advocacy efforts scored important victories for psychiatrists and patients in the 2024 Medicare Physician Fee Schedule, released by the Centers for Medicare and Medicaid Services (CMS) on November 2. These include policies regarding reimbursement for psychotherapy conducted in addition to evaluation and management (E/M) services, outpatient telepsychiatry, the Merit-Based Incentive Payment System (MIPS) reporting, and virtual supervision of trainees. The new policies will go into effect January 1, 2024.

Those gains will offset an expected decrease in physician payment overall. Unless Congress acts to reverse it, the Medicare “conversion factor”—a component of the equation that determines physician payment—will be reduced by 3.4% in 2024.

The impact of that overall reduction for individual psychiatrists will depend on what kinds of services they provide. Importantly, CMS accepted APA’s recommendation to increase the relative value units (RVUs) for psychotherapy codes used alongside codes for an evaluation and management (E/M) service by approximately 19.1%, phased in over four years. For 2024, this will result in an increase in payment for psychotherapy visits of between $3 and $6.

Jeremy Musher, M.D., chair of APA’s Committee on RBRVS, Codes, and Reimbursement, explained that the increase in payment for psychotherapy added on to an evaluation and management (E/M) service improves compensation for psychiatrists who are doing at least 16 minutes of psychotherapy along with other services—typically, medication management.

“CMS has been interested in increasing the value of the psychotherapy stand-alone codes that are used by psychologists, social workers, and other therapists,” Musher said in comments to Psychiatric News. “What we were able to do is convince CMS that if the administration wanted to appropriately increase the value of psychotherapy, it should also do so for psychiatrists who are providing psychotherapy add-on services combined with evaluation and management. Without this increase included in the final rule, psychiatrists would have fallen further behind our nonmedical colleagues in reimbursement for psychotherapy services.”

(RBRVS refers to the Resource-Based Relative Value Scale, the equation used to determine physician payment. The RBRVS combines “relative value units” for a physician’s work, practice expenses, and malpractice into a total relative value unit, or RVU, adjusted for geographic variation. This RVU is then multiplied by the “conversion factor”—a variable derived by Congress through its Office of Management and Budget—to arrive at a fee for each reimbursement code.)

As part of the 2024 fee schedule, CMS also approved a new E/M add-on code (G2211), which can be used in addition to codes for outpatient E/M services to recognize the resource costs associated with care of patients with chronic or complex conditions.

Musher explained that the “G” code is a new one designed for primary care and some specialty physicians—including psychiatrists—who see patients over time. “This code recognizes that there are additional costs associated with the care of chronic or complex patients,” he said.