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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 state that Neuropsychological testing is considered medically necessary for the following indications: 

1. When there are deficits on standard mental status testing or clinical interview, and a neuropsychological 
assessment is needed to establish the presence of abnormalities or distinguish them from other disease 
processes; or 
2. When neuropsychological data could provide clarification of clinical, laboratory, and neuroimaging 
data to assist in establishing a clinical diagnosis in neurological or systemic conditions known to affect 
CNS functioning; or 
3. When there is a need to quantify cognitive or behavioral deficits related to CNS impairment, and the 
information will be useful in determining a prognosis or treatment planning by determining the rate of 
disease progression; or 
4. When there is a need for a pre-surgical or treatment-related cognitive evaluation to inform whether one 
might safely proceed with a medical or surgical procedure that may affect brain function (e.g., deep 
brain stimulation, resection of brain tumors or arteriovenous malformations, epilepsy surgery) or 
significantly alter a patient's functional status; or 
5. When there is a need to assess the potential impact of adverse effects of therapeutic substances that may 
cause cognitive impairment (e.g., radiation, chemotherapy, antiepileptic medications), and this 
information is utilized in treatment planning; or 
6. When there is a need to assess progression, recovery, and response to changing treatments, in patients 
with CNS disorders, in order to determine the most effective plan of care; or 
7. When there is a need for objective measurement of patients' subjective complaints about memory, 
attention, or other cognitive dysfunction, which directly impacts medical management by differentiating 
psychogenic from neurogenic syndromes (e.g., dementia vs. depression), and in some cases will result 
in initial detection of neurological disorders or systemic diseases affecting the brain; or 8. When there is a need for treatment planning purposes of determining functional abilities/impairments in 
individuals with known or suspected CNS disorders (e.g., capacity for independent living or movement 
from a family home into an institutional setting); or 
9. When there is a need to determine whether a patient can comprehend and participate effectively in 
complex treatment regimens and to determine functional capacity for health care decision-making, 
independent living, etc.; or 
10. When there is a need to design, administer, and/or assess outcomes of cognitive rehabilitation 
procedures, often in collaboration with other specialists such as speech pathologists, occupational 
therapists, physiatrists, and rehabilitation psychologists; or 
11. When there is a need for treatment planning of identification and assessment of neurocognitive sequelae 
of disease ; or 
12. Assessment of neurocognitive functions for the formulation of rehabilitation and/or management 
strategies for certain individuals with neuropsychiatric disorders; or 
13. When there is a need to diagnose cognitive or functional deficits in children and adolescents based on 
an inability to develop expected knowledge, skills or abilities as required to adapt to new or changing 
cognitive, social, emotional, or physical demands. 

The content of neuropsychological testing procedures differs from that 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.). 
Psychological testing codes include the administration, interpretation, and scoring of the medically accepted 
tests for the evaluation of intellectual strengths, psychopathology, psychodynamics, mental health risks, insight, 
motivation, and other factors influencing treatment and prognosis. 
Psychological tests are used to address a variety of questions about people's functioning, diagnostic 
classification, co-morbidity, and choice of treatment approach. For example, personality tests and inventories 
evaluate the thoughts, emotions, attitudes, and behavioral traits that contribute to an individual's interpersonal 
functioning. The results of these tests determine an individual's personality strengths and weaknesses and may 
identify certain disturbances in personality or psychopathology. One type of personality test is the projective 
personality assessment, which asks a subject to interpret some ambiguous stimuli, such as a series of inkblots. 
The subject's responses can provide insight into his or her thought processes and personality traits. 

Examples of problems that might require psychological testing include: 

1. Assessment of mental functioning for individuals with suspected or known mental disorders for 
purposes of differential diagnosis and/or treatment planning. 
2. Assessment of patient strengths and disabilities for use in treatment planning or management when 
signs or symptoms of a mental disorder are present. 
3. Assessment of patient capacity for decision-making when impairment is suspected that would affect 
patient care or management. 
4. Assessment of mental function in certain chronic pain patients when indicated after psychological 
screening prior to surgical pain management intervention (e.g., implantable neurostimulator). 
5. Assessment of mental function in a chronic pain patient with suspected somatization disorder. 

When a psychiatric condition or the presence of dementia has already been diagnosed, there is value to the 
testing only if the information derived from the testing would be expected to have significant impact on the 
understanding and treatment of the patient. Examples include a significant change in the patient's condition, the 
need to evaluate a patient's capacity to function in a given situation or environment, and/or the need to specifically tailor therapeutic and/or compensatory techniques to particular aspects of the patient's pattern of 
strengths and disabilities. 
 
You can find this rule in the Local Coverage Determination (LCD) for Psychological and Neuropsychological 
Tests, L34520. 

The rules say that codes 96132, 96133, 96136, 96137, 96138, and 96139 describe testing which is intended to 
diagnose and characterize the neurocognitive effects of medical disorders that impinge directly or indirectly on 
the brain. 

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). In circumstances when additional 
time is necessary to integrate other sources of clinical data including previously completed and reported 
technician- and/or computer-administered tests, the neuropsychological testing may include time spent 
integrating self-report questionnaires. 
You can find this rule in the Local Coverage Article Billing and Coding: Psychological and 
Neuropsychological Tests, A57780. 
 
If you want to read these Medicare rules, you can go to this website www.medicareappeal.com. 
 
The Plan contract says that the Plan covers items and services in accordance with Medicare rules.