Proposed Medicare Cuts to Psychotherapy Reimbursement - 8-15-11

Many of you have heard about the appointment of the Joint Select Committee on Deficit Reduction (JSCDR), the “Supercommittee” formed as the result of the Budget Control Act two weeks ago.  The Committee is tasked with saving $1.2 trillion in the Federal budget over the next ten years.  If the Joint Committee fails to reach an agreement that can pass in both chambers, automatic 2% cuts to Medicare and other programs supporting mental health would be enacted.  

Psychotherapy reimbursement has been under attack over the past year at a higher level than the rest of Medicare-covered services.  CSWA, partnering with NASW and the American Psychological Association, has successfully fought off the 25% cut to LCSWs through the Sustainable Growth Rate (SGR) and the 5% cut to LCSWs by the CMS to enhance mental health services that we cannot provide (evaluation and management) this year. We were unable to prevent the Medical Economic Index cut to LCSWS of 4% in January, based on the amount of time spent providing services in the context of practice expenses and malpractice insurance, i.e., lower for LCSWs than physicians, so reimbursement can be lower.

In short, LCSWs could face a Medicare reimbursement cut of up to 39.5% this year if all the proposed cuts being considered by the Committee are enacted. As we know from past experience, private insurers are likely to follow suit.
 
The dire impact that this would have on our livelihoods requires action.  I urge all CSWA members to meet with your members of Congress or their staff during the August recess when they are ‘in-district’, or in their legislative districts.  This is especially important for those of you who are in districts with a member of the JSCDR as follows:

Co-chairs: Senator Patty Murray (D-WA), Rep. Jeb Hensarling (R-TX)
Sens. Max Baucus (D-MT), John Kerry (D-MA), Jon Kyl (R-AZ), Pat Toomey (R-PA),Rob Portman (R-OH)
Reps. James Clyburn (D-SC), Xavier Becerra (D-CA), and Chris Van Hollen (D-MD), Dave Camp (R-MI), Fred Upton (R-MI)

If you cannot meet with your legislators or their staff directly I would call their health care legislative aide with the following message:
 
“I am a member of the Clinical Social Work Association and constituent.  Licensed clinical social workers (LCSWs) provide the majority of psychotherapy services to our citizens.   We are small business men and women who have a deep commitment to serving the elderly and the disabled.  We have continually faced cuts to psychotherapy services this year of 5%, forestalled by the Psychotherapy Extender, and to all services through a 29.5% based on the Sustainable Growth Rate.  Such cuts are once again being considered and would make continuing as a Medicare provider a financial hardship for me.  My Medicare reimbursement rates were already cut 4% in January, based on the Medical Economic Index.

LCSW services are needed now more than ever in this time of economic crisis.  A 39.5% cut in reimbursement would make serving Medicare beneficiaries impossible for me financially.  Allow LCSWs to continue serving Medicare enrollees by preserving funding for psychotherapy services.”

If you need to find contact information for your members of Congress, go to www.congress.org.  As always, please let me know the responses that you get to your visits and calls. Thanks for your help.
 

Background Information –
Medicare Reimbursement for Psychotherapy Services

August, 2011
This paper summarizes the cuts which have been proposed during the past year to the Medicare outpatient mental health benefit.  The Clinical Social Work Association strongly encourages Congress to prevent these cuts.  
 
Mental Health Extender.  Congress restored payments temporarily but they now need to be extended.  Through the Medicare Improvements for Patients and Providers Act of 2008, Congress partially restored the cuts made by the Centers for Medicare & Medicaid Services (CMS) “Five-Year Review” through 2009. Subsequent laws then extended the restoration through December 2011. The valuation of psychotherapy codes in the 2011 Five-Year Review has been delayed into 2012.  Congress should pass new legislation to extend payments through 2012, until the Five-Year Review is completed.
 
Cut By MEI Rebasing.  A CMS technical advisory panel will be asked to examine the effect of a 4% cut to Medicare part B reimbursement for LCSWs in January 2011 due to “rebasing” of the Medicare Economic Index (MEI).  In the 2011 fee schedule, CMS used more recent survey data that showed practice expense and malpractice became a larger share of the payment formula while provider’s time became smaller. This increased payments for some services, particularly of professionals who utilize expensive technology.  Though CMS reduced other reimbursement work values, LCSWs and psychologists were hit the hardest because they typically provide services at lower cost and lower overhead.
 
Proposed Sustainable Growth Rate Cuts.  LCSWs were saved from a second and  reduction when Congressional action halted the projected 25% SGR cut through December 31, 2011. The current proposed cut to psychotherapy services using the SGR formula would be 29.5%.

Effect on Beneficiaries. Extending payments cut by the Five-Year Review is crucial to protecting access to Medicare mental health services. Licensed clinical social workers and psychologists provide almost all of the Medicare psychotherapy services. Many LCSWs may have to leave Medicare if they are faced with these reimbursement cuts. The cost of protecting mental health services is very low, increasing costs by only $30 million per year.

Medicare beneficiaries need the psychotherapy services provided by LCSWs.  Please preserve their access to LCSW mental health treatment by maintaining current mental health reimbursement rates.