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The rules say that plans must pay for a medical service or item if regular Medicare would pay for it in this case. You can find this rule at 42 Code of Federal Regulations (CFR) Section 422.101.The rules say thattheservices must meet the following criteria:C. Outpatient Mental Health Treatment LimitationEffective January 1, 2010, the current 62.5 percent limitation will be increased as follows:2010-2011 = 68.75 percent;2012 = 75 percent;2013 = 81.25 percent; and,2014 and onward = 100 percent.Effective January 1, 2014, Medicare will pay outpatientmental health services at the same level as other Part B services. That is, at 80 percent of the physician fee schedule.The outpatient mental health treatment limitation does not apply to psychiatric diagnostic evaluations, diagnostic psychological and neuropsychological testing,or inpatient hospital services.The limitation applies to procedures for psychiatric therapy evaluation codes except in in-patient hospital and inpatient psychiatric facility.When evaluation and management (E&M) codes are reported for treatment of psychiatric illness, except Alzheimer's Disease and related dementias, the psychiatric limitation also applies to those services. For patients with Alzheimer's Disease or related dementias, if the primary treatment rendered is psychotherapy, the limitation applies to the therapy services. The limitation does not apply to an E&M service, or a non-psychotherapy service, rendered for the management of Alzheimer's Disease or related dementias.Effective for claims received on or after 01/01/2010, pharmacologic management or any successor code is not subject to the limitation.Brief office visit for the purpose of monitoring or changing drug prescriptions or any successor code is not subject to the limitation.Section I: Psychiatric Diagnostic Interview Examination :Description: The psychiatric diagnostic procedure codes require the elicitation of a complete medical (including past, family, social) and psychiatric history, a mental status examination, establishment of an initial diagnosis, an evaluation of the patient's ability and capacity to respond to treatment, and an initial plan of treatment. Information may be obtained from not only the patient, but also other physicians, healthcare providers, and/or family if the patient is unable to provide a complete history.Note: This service may be reported once per day and not on the same day as an evaluation and management service performed by the same individual for the same patient.Documentation: The medical record must reflect the elements outlined in the above description and must be rendered by a qualified provider (see "Limitations" subsection below).Comments: This service may be covered once, at the outset of an illness or suspected illness. It may be utilized 
again for the same patient if a new episode of illness occurs after a hiatus or on admission or readmission to an inpatient status due to complications of the underlying condition. Certain patients, especially children, may require more than one visit for the completion of the initial diagnostic evaluation. The medical record must support the reason for more than one diagnostic interview.Testing which is intended to diagnose and characterize the neurocognitive effects of medical disorders that impinge directly or indirectlyon the brain. Examples of problems that might lead to neuropsychological testing are:Detection of neurologic diseases based on quantitative assessment of neurocognitive abilities (e.g., mild head injury, anoxic injuries, AIDS dementia)Detectionof neurologic diseases based on quantitative assessment of neurocognitive abilities (e.g., mild head injury, anoxic injuries, AIDS dementia)Differential diagnosis between psychogenic and neurogenic syndromesDelineation of the neurocognitive effects of central nervous system disordersNeurocognitive monitoring of recovery or progression of central nervous system disorders; orAssessment of neurocognitive functions for the formulation of rehabilitation and/or management strategies among individuals with neuropsychiatric disorders.Documentation: The medical record must document that the guidelines outlined in the "Description" and "Comments" sections were followed.Comments: The content of neuropsychological testing procedures differs fromthat of psychological testing in that neuropsychological testing consists primarily of individually administered ability tests that comprehensively sample cognitive and performance domains that are known to be sensitive to the functional integrity of the brain (e.g., abstraction, memory and learning, attention, language, problem solving, sensorimotor functions, constructional praxis, etc.). These procedures are objective and quantitative in nature and require the patient to directly demonstrate his/her level of competence in a particular cognitive domain. Neuropsychological testing does not rely on self-report questionnaires such as the Minnesota Multiphasic Personality Inventory 2 (MMPI-2), rating scales such as the Hamilton Depression Rating Scale, or projective techniques such as the Rorschach or Thematic Apperception Test (TAT).Typically, psychological testing will require from four (4) to six (6) hours to perform, including administration, scoring and interpretation. If the testing is done over several days, the testing time should be combined and reported all on the last date of service. If the testing time exceeds eight (8) hours, a report may be requested to indicate the medical necessity for extended testing.Limitations:Severe and profound mental retardation is never covered for psychotherapy services. In such cases, rehabilitative, evaluation and management (E/M) codes, or pharmacological management codes should be reported.Patients with dementia represent a very vulnerable population in which co-morbid psychiatric conditions are common. However, for such a patient to benefit from psychotherapy services requires that their dementia to be mild and that they retain the capacity to recall the therapeutic encounter from one session, individual or group, to another. This capacity to meaningfully benefit from psychotherapy must be documented in the medical record. Psychotherapy services are not covered when documentation indicates that dementia has produced a severe enough cognitive defect to preventpsychotherapy from being effective.You can find this information in Medicare's Local Coverage Determination (LCD): Outpatient Psychiatry and Psychology Services (L34353).
If you want to read these Medicare rules, you can go to this website www.medicareappeal.com.