**Abstract:**  
  
This LCD outlines the medical necessity requirements for Part A and Part B
services in the fields of psychiatry, psychology, clinical social work, and
psychiatric nursing for the diagnosis and treatment of various mental
disorders and/or diseases.  
  
 **Indications:**  
  
A. Approved Providers of Service

  * Physicians (MD/DO)
  * Clinical psychologists
  * Clinical Social Workers
  * Nurse practitioners
  * Clinical Nurse Specialists
  * Physician Assistants
  * Other providers of mental health services licensed or otherwise authorized by the state in which they practice (e.g., licensed clinical professional counselors, licensed marriage and family therapists). These other providers may not bill Medicare directly for their services, but may provide mental health treatment services to Medicare beneficiaries under the "incident to" provision. For more information see the CGS LCD on Psychological Services Provided "Incident to."

  
  
B. General Coverage Requirements:  
  
This section applies to psychiatric services rendered in a hospital outpatient
facility, but the medical necessity parameters contained herein may also be
applicable to services billed to Part B by individual providers.  
  
Hospital outpatient psychiatric services must be: [1] _incident to a
physician's service, and_ [2] _reasonable and necessary for the diagnosis or
treatment of the patient's condition_ (CMS Publication 100-02, _Medicare
Benefit Policy Manual_ , Chapter 6, Section 70.1). This means the services
must be for the purpose of diagnostic study or the services must reasonably be
expected to improve the patient's condition. "Incident to" provisions do not
apply to professional services performed by nurse practitioners (NPs),
clinical nurse specialists (CNSs), clinical psychologists (CPs) or clinical
social workers (CSWs). Physician assistants (PAs) are required to perform
services under the general supervision of a physician. (See 42 CFR 410.71-76.)
Psychiatric services provided incident to a physician's service must be
rendered by individuals licensed or otherwise authorized by the State and
qualified by their training to perform these services.  
  
 __Coverage Criteria.__ _The services must meet the following criteria:  
  
 _Individualized Treatment Plan._ Services must be prescribed by a physician
and provided under an individualized written plan of treatment established by
a physician after any needed consultation with appropriate staff members. The
plan must state the type, amount, frequency, and duration of the services to
be furnished and indicate the diagnoses and anticipated goals. (A plan is not
required if only a few brief services will be furnished.)_ (CMS Publication
100-02, _Medicare Benefit Policy Manual_ , Chapter 6, Section 70.1).  
  
 __Reasonable Expectation of Improvement.__ _Services must be for the purpose
of diagnostic study or reasonably be expected to improve the patient's
condition. The treatment must, at a minimum, be designed to reduce or control
the patient's psychiatric symptoms so as to prevent relapse or
hospitalization, _and_ improve or maintain the patient's level of functioning_
(CMS Publication 100-02, _Medicare Benefit Policy Manual_ , Chapter 6, Section
70.1).  
  
 _It is not necessary that a course of therapy have as its goal restoration of
the patient to the level of functioning exhibited prior to the onset of the
illness, although this may be appropriate for some patients. For many other
psychiatric patients, particularly those with long-term, chronic conditions,
control of symptoms and maintenance of a functional level to avoid further
deterioration or hospitalization is an acceptable expectation of improvement.
"Improvement" in this context is measured by comparing the effect of
continuing treatment versus discontinuing it. Where there is a reasonable
expectation that if treatment services were withdrawn the patient's condition
would deteriorate, relapse further, or require hospitalization, this criterion
would be met_ (CMS Publication 100-02, _Medicare Benefit Policy Manual_ ,
Chapter 6, Section 70.1).  
  
 _Some patients may undergo a course of treatment which increases their level
of functioning, but then reach a point where further significant increase is
not expected_ (CMS Publication 100-02, _Medicare Benefit Policy Manual_ ,
Chapter 6, Section 70.1). When stability can be maintained without further
treatment or with less intensive treatment, the psychological services are no
longer medically necessary.  
  
 __Frequency and Duration of Services.__ _There are no specific limits on the
length of time that services may be covered. There are many factors that
affect the outcome of treatment; among them are the nature of the illness,
prior history, the goals of treatment, and the patient's response. As long as
the evidence shows that the patient continues to show improvement in
accordance with his/her individualized treatment plan, and the frequency of
services is within accepted norms of medical practice, coverage may be
continued_ (CMS Publication 100-02, _Medicare Benefit Policy Manual_ , Chapter
6, Section 70.1).  
  
When a patient reaches a point in his/her treatment where further improvement
does not appear to be indicated and there is no reasonable expectation of
improvement, the outpatient psychiatric services are no longer considered
reasonable or medically necessary.  
  
Mental Health Services provided in a CORF include:  
  
 _Social and psychological services include the assessment and treatment of a
CORF patient 's mental health and emotional functioning and the response to,
and rate of progress of the patient's rehabilitation plan of treatment
including physical therapy services, occupational therapy services, speech-
language pathology services and respiratory therapy services.  
  
CORF social and/or psychological covered services are the same, regardless of
whether they are provided by a qualified social worker, as defined at
42CFR485.70(l), or a psychologist, as defined at 42CFR485.70(g). Therefore, a
CORF may elect to provide these services when they are indicated.
Qualifications for individuals providing CORF social and psychological
services are, at a minimum, a Bachelors of Science Degree for a social worker
and a Masters-level degree for a psychologist._ (CMS Publication 100-02,
_Medicare Benefit Policy Manual_ , Chapter 12, Section 40.7).  
  
Note: Partial Hospitalization is a distinct and organized intensive treatment
program for patients who would otherwise require inpatient psychiatric care.
Partial Hospitalization services are not addressed in this policy.  
  
C. Outpatient Mental Health Treatment Limitation  
  
Effective January 1, 2010, the current 62.5 percent limitation will be
increased as follows:

  1. 2010-2011 = 68.75 percent;
  2. 2012 = 75 percent;
  3. 2013 = 81.25 percent; and,
  4. 2014 and onward = 100 percent.

Effective January 1, 2014, Medicare will pay outpatient mental 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.  
  
D. Specific Coverage Requirements:  
  
Information in this part of the policy has been divided into seven (7)
sections. These sections address the following procedures:

  * Psychiatric Diagnostic Procedures
  * Interactive Complexity
  * Psychotherapy
  * Psychotherapy in Crisis
  * Psychiatric Somatherapy
  * Central Nervous System Assessments/Tests (e.g., Neuro-Cognitive, Mental Status, Speech Testing)
  * Other Psychiatric Services or Procedures

Unless otherwise indicated the above codes may be used by psychiatrists or
other physicians trained in the treatment of mental illness (MDs/DOs),
clinical psychologists, clinical social workers, clinical nurse specialists
and other nurses with special training and/or experience in psychiatric
nursing beyond the standard curriculum required for a registered nurse (e.g.,
Masters of Science in psychiatric nursing, or its equivalent [Advanced
Registered Nurse Practitioner with a Master's degree in Mental Health, or
equivalent to a Master's prepared, certified Clinical Nurse Specialist]).  
  
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.  
  
Section II: _Interactive Complexity_ :  
  
Description: :"Interactive complexity refers to specific communication factors
that complicate the delivery of a psychiatric procedure. Common factors
include more difficult communication with discordant or emotional family
members and engagement of young and verbally undeveloped or impaired
patients." (CPT 2013, Professional Edition, p.483)  
  
The interactive complexity component code may be used in conjunction with
codes for diagnostic psychiatric evaluation and psychotherapy, psychotherapy
when performed with an evaluation and management service, and group
psychotherapy.  
  
The code is used principally to evaluate children and also adults who do not
have the ability to interact through ordinary verbal communication. The
healthcare provider uses inanimate objects, such as toys and dolls for a
child, physical aids and non-verbal communication to overcome barriers to
therapeutic interaction, or an interpreter for a person who is deaf or one who
does not speak the same language as the healthcare provider.

  * Interactive complexity may also be used in the evaluation of adult patients with organic mental deficits, or for those who are catatonic or mute.
  * Interactive complexity may be reported with psychotherapy when at least one of the following is present:
  * Maladaptive communication (eg, high anxiety, high reactivity, repeated questions or disagreement)
  * Emotional or behavioral conditions inhibiting implementation of treatment plan
  * Mandated reporting/event exists (eg, abuse or neglect) or
  * Play equipment, devices, interpreter, or translator required due to inadequate language expression or different language spoken between patient and professional.   
  
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) and must indicate that the person being
evaluated does not have the ability to interact through normal verbal
communicative channels. Additionally, the medical record must include
adaptations utilized in the session and the rationale for employing these
interactive techniques. If the patient is capable of ordinary verbal
communication, this code should not be used. The medical record must include
treatment recommendations.  
  
Section III: _Psychotherapy Psychiatric Therapeutic Procedures_ :  
  
Information in this part of the policy has been subdivided into three (3)
sections. These sections address the following procedures:

    * Represent insight oriented, behavior modifying, supportive, and/or interactive psychotherapy
    * Represent psychoanalysis, group psychotherapy, family psychotherapy, and/or interactive group psychotherapy
    * Represents narcosynthesis for psychiatric diagnostic and/or therapeutic purposes

A. Codes representing insight oriented, behavior modifying, supportive, and/or
interactive psychotherapy  
  
Description: Procedures for psychotherapy are defined as "the treatment for
mental illness and behavioral disturbances in which the physician or other
qualified health care professional through definitive therapeutic
communication attempts to alleviate the emotional disturbances, reverse or
change maladaptive patterns of behavior and encourage personality growth and
development." (CPT 2013, Professional Edition, p.485)  
  
Documentation: The medical record must indicate the time spent in the
psychotherapy encounter and the therapeutic maneuvers, such as behavior
modification, supportive or interpretive interactions that were applied to
produce a therapeutic change. Behavior modification is not a separate service,
but is an adjunctive measure in psychotherapy. Additionally, a periodic
summary of goals, progress toward goals, and an updated treatment plan must be
included in the medical record. Prolonged periods of psychotherapy must be
well-supported in the medical record describing the necessity for ongoing
treatment.  
  
Procedure for psychotherapy are timed codes that are used to represent the
actual time spent with the patient. There are add on codes that should be used
in conjunction with evaluation and management (E/M) codes.

  
For psychotherapy sessions lasting 90 minutes or longer, the appropriate
prolonged service code should be used . The duration of a course of
psychotherapy must be individualized for each patient. Prolonged treatment may
be subject to medical necessity review. The provider must document the medical
necessity for prolonged treatment.  
  
Comments: While a variety of psychotherapeutic techniques are recognized for
coverage under these codes, the services must be performed by persons
authorized by their state to render psychotherapy services. Healthcare
providers would include: physicians, clinical psychologists, registered nurses
with special training (as described in the "Indications" section), and
clinical social workers. Medicare coverage of procedure codes for psychiatric
therapy does not include teaching grooming skills, monitoring activities of
daily living (ADL), recreational therapy (dance, art, play) or social
interaction. Therefore, these should not be used to bill for ADL training
and/or teaching social interaction skills.  
  
  
Psychotherapy codes that include an evaluation and management component are
payable only to physicians, NPPs and CNSs. The evaluation and management
component of the services must be documented in the record. A psychotherapy
code should not be billed when the service is not primarily a psychotherapy
service, that is, when the service could be more accurately described by an
evaluation and management or other code.  
  
The duration of a course of psychotherapy must be individualized for each
patient. Prolonged treatment may be subject to medical necessity review. The
provider must document the medical necessity for prolonged treatment.  
  
B. Codes representing psychoanalysis, group psychotherapy, family
psychotherapy, and/or interactive group psychotherapy

Psychoanalysis:

  
Description: Procedure code involves the practice of psychoanalysis using
special techniques to gain insight into and treat a patient's unconscious
motivations and conflicts using the development and resolution of a
therapeutic transference to achieve therapeutic effect. It is a different
therapeutic modality than psychotherapy.  
  
Documentation: The medical record must document the indications for
psychoanalysis, description of the transference, and the psychoanalytic
techniques used.  
  
Comments: The physician or other healthcare professional using this technique
must be trained by an accredited program of psychoanalysis. The code for this
service is not time defined, but is usually 45 to 50 minutes and is billed
once for each daily session.  
  
Family Psychotherapy:  
  
Description: Procedure codes that describe the treatment of the family unit
when maladaptive behaviors of family members are exacerbating the
beneficiary's mental illness or interfering with the treatment, or to assist
the family in addressing the maladaptive behaviors of the patient and to
improve treatment compliance. Family Psychotherapy can be done without or with
the patient is present. Group therapy sessions to support multiple families
when similar dynamics are occurring due to common issues confronted in the
family members under treatment.  
  
Documentation: The medical record must document the conditions described under
the "Description" and "Comments" sections relative to codes for family
psychotherapy.  
  
Comments: The _Medicare National Coverage Determinations Manual_ , Chapter 1,
Section 70.1, states that family psychotherapy services are covered only where
the primary purpose of such psychotherapy is the treatment of the patient's
condition. Examples include:

  * When there is a need to observe and correct, through psychotherapeutic techniques, the patient's interaction with family members.
  * Where there is a need to assess the conflicts or impediments within the family, and assist, through psychotherapy, the family members in the management of the patient.

The term "family" may apply to traditional family members, live-in companions,
or significant others involved in the care of the patient. The codes
representing these services are not timed but are typically 45 to 60 minutes
in duration.  
  
These services do not pertain to consultation and interaction with paid staff
members at an institution. Facility staff members are not considered
"significant others" for the purposes of this LCD.  
  
Multiple-family group psychotherapy and is generally non-covered by Medicare.
Such group therapy is usually directed to the effects of the patient's
condition on the family and its purpose is to support the affected family
members. Therefore, multiple-family group psychotherapy does not meet
Medicare's standards of being a therapy primarily directed toward treating the
beneficiary's condition. These may be approved on an individual consideration
basis.  
  
Group Psychotherapy:  
  
Description: Code(s) representing psychotherapy administered in a group
setting, involving no more than 12 participants, facilitated by a trained
therapist simultaneously providing therapy to these multiple patients. The
group therapy session typically lasts 45 to 60 minutes. Personal and group
dynamics are discussed and explored in a therapeutic setting allowing
emotional catharsis, instruction, insight, and support.  
  
Documentation: The record must indicate that the guidelines under the
"Description" and "Comments" sections were followed.  
  
Comments: Group therapy, since it involves psychotherapy, must be led by a
person who is licensed or otherwise authorized by the state in which he or she
practices to perform this service. This will usually mean a psychiatrist,
psychologist, clinical social worker, clinical nurse specialist, or other
person authorized by the state to perform this service. Registered nurses with
special training, as described in the "Indications and Limitations of Coverage
and/or Medical Necessity" section, may also be considered eligible for
coverage. For Medicare coverage, group therapy does not include:
socialization, music therapy, recreational activities, art classes,
excursions, sensory stimulation or eating together, cognitive stimulation, or
motion therapy, etc.  
  
  
Codes interactive psychotherapy:  
  
As a reminder, this is used when the patient or patients in the group setting
do not have the ability to interact by ordinary verbal communication and
therefore, non-verbal communication skills are employed or an interpreter may
be necessary.  
  
C. Narcosynthesis for psychiatric diagnostic and/or therapeutic purposes  
  
Description: This therapy is used for the administration of sedative or
tranquilizer drugs, usually intravenously, to relax the patient and remove
inhibitions for discussion of subjects difficult for the patient to discuss
freely in the fully conscious state.  
  
Documentation: The medical record should document the medical necessity of
this procedure (e.g., the patient had difficulty verbalizing their psychiatric
problems without the aid of the drug). The record should also document the
specific pharmacological agent, dosage administered, and whether the technique
was effective or non-effective.  
  
Comments: Use of this type of therapy is restricted to physicians (MD/DO)
only.  
  
Section IV: _Psychiatric in Crisis_  
  
Description: "Psychotherapy for crisis is an urgent assessment and history of
a crisis state, a mental status exam, and a disposition, The treatment
includes psychotherapy, mobilization of resources to defuse the crisis and
restore safety, and implementation of psychotherapeutic interventions to
minimize the potential for psychological trauma. The presenting problem is
typically life threatening or complex and requires immediate attention to a
patient with high distress." (CPT 2013, Professional Edition, p.486)  
  
Documentation: The record must indicate that the guidelines under the
"Description" and "Comments" sections were followed.  
  
Comments: "Codes used to report the total duration of time face-to-face with
the patient and/or family spent by the physician or other qualified health
care professional providing psychotherapy for crisis, even if the time spent
on that date is not continuous. For any given period of time spent providing
psychotherapy for crisis state, the physician or other qualified health care
professional must devote his or her full attention to the patient and,
therefore, cannot provide service to any other patient during the same time
period. The patient must be present for all or some of the service." (CPT
2013, Professional Edition, p.486)  
  
Section V. _Psychiatric Somatotherapy_  
These codes describe medication management and/or electroconvulsive therapy.  
  
  
Code Electroconvulsive Therapy (ECT), :  
  
Description: Electroconvulsive therapy (ECT), is described as the application
of electric current to the brain, through scalp electrodes to produce a
seizure. It is used primarily to treat major depressive disorder when
antidepressant medication is contraindicated and for certain other clinical
conditions.  
  
Comments: When a psychiatrist performs both the ECT and the associated
anesthesia, no separate payment is made for the anesthesia. Code 90870 is
limited to use by physicians (MD/DO) only.  
  
Section VI: _Other Psychiatric Services_  
  
A. Description: Individual psychophysiological therapy incorporating
biofeedback training by any modality (face to face with patient), with
psychotherapy (e.g., insight-oriented, behavior-modifying or supportive
psychotherapy).  
  
Comments: The _Medicare National Coverage Determinations Manual_ , Chapter 1,
Section 30.1, restricts the use of biofeedback. Medicare does not cover
biofeedback for the treatment of psychosomatic disorders.  
  
B. Description: Hypnotherapy

Hypnosis is an artificially induced alteration of consciousness in which the
patient is in a state of increased suggestibility.  
  
Documentation: Claims must be submitted with a covered diagnosis.  
  
Note: Environmental intervention for medical management purposes on a
psychiatric patient's behalf with agencies, employers, or institutions is not
covered by Medicare.  
  
C. Description: When a physician or advanced mental health practitioner is
asked to do a review of records for psychiatric evaluation without direct
patient contact.

This may be accomplished at the request of an agency or peer review
organization. It may also be employed as part of an overall evaluation of a
patient's psychiatric illness or suspected psychiatric illness, to aid in the
diagnosis and/or treatment plan.  
  
D. Description: When the treatment of the patient may require explanations to
the family, employers, or other involved persons for their support in the
therapy process. This may include reporting of examinations, procedures, and
other accumulated data.  
  
E. Description:Preparation of reports for insurance companies, agencies,
courts, etc.  
  
Comments: Administrative services that do not involve face to face contact
with the patient and are not covered by Medicare.  
  
F. Description: Unlisted psychiatric service or procedure codes should not be
used if the service is described by a specified codes. Psychiatric procedures
billed using an unlisted code  may be covered on an individual consideration
basis.  
  
Section VII: _Central Nervous System Assessments/Tests_ (e.g., Neuro-
Cognitive, Mental Status, Speech Testing):  
  
A. Description: Psychological testing includes the administration,
interpretation, and scoring of the tests mentioned in the CPT descriptions and
other medically accepted tests for evaluation of intellectual strengths,
psychopathology, psychodynamics, mental health risks, insight, motivation, and
other factors influencing treatment and prognosis.  
  
Documentation: The medical record must indicate the presence of mental illness
or signs of mental illness for which psychological testing is indicated as an
aid in the diagnosis and therapeutic planning. The record must show the tests
performed, scoring and interpretation, as well as the time involved.  
  
Comments: These codes do not represent psychotherapeutic modalities, but are
diagnostic aids. Use of such tests when mental illness is not suspected would
be a screening procedure not covered by Medicare. Each test performed must be
medically necessary. Therefore, standardized batteries of tests are not
acceptable unless each test in the battery is medically necessary.  
  
Changes in mental illness may require psychological testing to determine new
diagnoses or the need for changes in therapeutic measures. Repeat testing not
required for diagnosis or continued treatment would be considered medically
unnecessary. Nonspecific behaviors that do not indicate the presence of, or
change in, a mental illness would not be an acceptable indication for testing.
Psychological or psychiatric evaluations that can be accomplished through the
clinical interview alone (e.g., response to medication) would not require
psychological testing, and such testing might be considered as medically
unnecessary. Adjustment reactions or dysphoria associated with moving to a
nursing facility do not constitute medical necessity for psychological
testing.  
  
B. Description: The formal evaluation of aphasia using a psychometric
instrument such as the Boston Diagnostic Aphasia Examination. This testing is
typically performed once during treatment and the medical necessity for such
testing should be documented. Repeat testing should only be done if there is a
significant change in the patient's aphasic condition.  
  
  
Testing which is intended to diagnose and characterize the neurocognitive
effects of medical disorders that impinge directly or indirectly on 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)
  * Detection of neurologic diseases based on quantitative assessment of neurocognitive abilities (e.g., mild head injury, anoxic injuries, AIDS dementia)
  * Differential diagnosis between psychogenic and neurogenic syndromes
  * Delineation of the neurocognitive effects of central nervous system disorders
  * Neurocognitive monitoring of recovery or progression of central nervous system disorders; or
  * Assessment 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 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.). 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 prevent
psychotherapy from being effective.  
  
Any diagnostic or psychotherapeutic procedure rendered by a practitioner not
practicing within the scope of his/her licensure or other State authorization
will be denied.  
  
Psychiatric services billed under the hospital outpatient benefit must be
provided in distinct outpatient settings. Outpatient hospital services
provided in conjunction with inpatient services, or under the auspices of an
excluded inpatient unit, residential treatment center, residential facility,
or skilled nursing facility, are not in compliance with Medicare regulations
and payment will be denied. Payment may be made for psychiatric services in
these settings by individual providers billing Part B.  
  
The following services do not represent reasonable and necessary outpatient
psychiatric services and/or coverage is excluded under section 1862(a)(1)(A)
of the Social Security Act:

  * day care programs, which provide primarily social, recreational, or diversional activities, custodial or respite care;
  * programs attempting to enhance emotional wellness, e.g., day care programs;
  * services to a skilled nursing facility resident that should be expected to be provided by the nursing facility staff;
  * vocational training when services are related solely to specific employment opportunities, work skills, or work settings;
  * biofeedback training for psychosomatic conditions;
  * recovery meetings such as Alcoholics Anonymous, 12 Step, Al Anon, Narcotics Anonymous, due to their free availability in the community;
  * telephone calls to patients, collateral resources and agencies;
  * evaluation of records, reports, tests, and other data;
  * explanation of results to family, employers, or others;
  * preparation of reports for agencies, courts, schools, or insurance companies, etc. for medicolegal or informational purposes;
  * screening procedures provided routinely to patients without regard to the signs and symptoms of the patient's mental illness.

The following services are excluded from the scope of outpatient hospital
psychiatric services defined in Section 1927(k) of the Social Security Act:

  * services to hospital inpatients;
  * meals, transportation;
  * supervision or administration of self-administered medications and supplying medications for home use.

Evaluations of the mental status that can be performed within the clinical
interview, such as a list of questions concerning symptoms of depression or
organic brain syndrome, corresponding to brief questionnaires such as the
Folstein Mini Mental Status Examination or the Beck Depression Scale, should
not be billed as psychological testing (96101-96120), but is considered
included in the clinical interview.  
  
Psychological testing to evaluate adjustment reactions or dysphoria associated
with placement in a nursing home is not medically necessary. Routine testing
of nursing home patients is considered screening and is not covered.  
  
Each psychological test administered must be individually medically necessary.
A standard battery of tests is only medically necessary if each individual
test in the battery is medically necessary.  
  
The psychological testing codes should not be reported by the treating
physician for reading the testing report or explaining the results to the
patient or family. Payment for these services is included in the payment for
other services rendered to the patient, such as evaluation and management
services.  
  
Payment for psychological testing is limited to physicians, clinical
psychologists, and on a limited basis, to qualified non-physician
practitioners (e.g., speech language pathologists for aphasia evaluation).  
  
 ** **