News and Updates

Although called the Medicare physician fee schedule, this yearly list contains the values assigned to services provided by all health care professionals including psychologists. The fee schedule is a list of services and their code numbers that utilizes a payment system known as the Resource‑Based Relative Value Scale (RBRVS). The RBRVS includes three major components of resource costs required for each service: professional work, practice expense, and malpractice expense. As a “resource-based” relative value scale, the fee schedule is designed to reflect the resources the service requires, not the service’s value to the patient.

• professional work: This component reflects the professional time and intensity in providing the service. Factors such as mental effort and judgment, technical skill, physical effort, and psychological stress all measure the overall work involved in providing the service.
• practice expense: This component reflects the overhead costs involved in providing a service such as rent, utilities, equipment, and staff salaries (other than professional compensation and malpractice insurance costs).
• malpractice expense: This component reflects the malpractice expenses associated with the service, such as costs of insurance, etc.

The national uniform relative values for each of these components are then adjusted for each locality by geographic adjustment factors. As a result, Medicare providers are paid differently depending on where they practice. Largely populated states, such as New York, may have multiple separate payment localities.

Finally, each of the adjusted components is multiplied by an annual conversion factor that translates these values into reimbursement dollars.

Psychologists are paid 100% of the fee schedule, so reimbursement for psychologists is the same as it is for psychiatrists when providing services under the same billing codes.

More information about APA Services advocacy related to Medicare reimbursement and access can be found in the Medicare Reimbursement and Access section of the website.

Can I bill for missed appointments?

CMS reaffirmed in 2007 that providers can bill Medicare beneficiaries for missed appointments, as long as they do not discriminate against their Medicare patients. This means they must also charge non-Medicare patients for missed appointments and the charges for Medicare and non-Medicare patient must be the same. The charge for a missed appointment is a charge for a missed business opportunity, not a charge for a service itself (to which the assignment and limiting charge provisions apply). This decision by CMS is explained in MedLearn Matters Article MM5613 (PDF, 75KB)

Do you need to notify Medicare of a change in your practice?

CMS has posted fact sheets listing the types of changes that physicians, nonphysician providers, and group practices are required to report to Medicare within 90 days of the applicable change. This information is accessible from the Medicare Provider Enrollment page.

Psychologists enrolled in the Medicare program should read the fact sheets to know if and when they need to submit a report. Changes in a practice’s location, business structure, or legal business name are among the reasons a psychologist would be required to notify Medicare.

The fact sheets also indicate which forms need to be submitted to report the changes and where practitioners may seek assistance. Not reporting a change may adversely affect claims processing, claims payment amounts, and eligibility of a nonphysician provider or group practice to participate in Medicare.

• Reporting Responsibilities for Individual Non-Physician Practitioners Enrolled in the Medicare Program (PDF, 539KB)
• Reporting Responsibilities for Group Practices Enrolled in the Medicare Program (PDF, 583KB)

• Practice Organization comments on Centers for Medicare and Medicaid Services’ proposed rule on Merit-Based Incentive Payment System and Alternative Payment Models: Comment letter to CMS addresses low payment for psychological services and quality reporting mechanisms.
• CMS proposes new Medicare incentive payment system: Psychologists treating Medicare patients will need to follow new reporting process.
• PQRS ending in December 2016: CMS transitioning to the new Merit-Based Incentive Payment System (MIPS).
• 2016 Medicare fee schedule final rule: Highlights for psychologists: Information on the impact on reimbursement, PQRS reporting and other aspects of the rule.