Mental Health Billing Services – Medicare, Medicaid, And Private Insurers 

Medicare, Medicaid, and Private insurers cover patients' mental health services in many different ways. And as a result, mental health professionals face an uphill battle when attempting to receive reimbursement for services they provide. 

No matter who the insurer is, a Mental Health Billing service can help with coding and reimbursements. 

Let's explore Medicaid first.

According to some reports, Medicaid is the single largest payer of mental health services in the United States and is increasingly playing a more significant role in reimbursing practices for substance use disorders. 

It was estimated that almost 12 million visits made to U.S. hospital emergency departments involved individuals with a mental disorder or substance abuse problems, or both.

Medicaid coverage of mental health services varies widely from state to state. However, requirements exist for these services to be provided to specific groups.

For example, in all states, children enrolled in Medicaid are entitled to receive all medically necessary services, including mental health services.

Additionally, alternative benefit plans (ABPs) must contain essential health benefits, including mental health and substance use disorder benefits. Also, Medicaid stipulates that all ABP mental health services must equal medical and surgical benefits.

Furthermore, states are required to cover certain mental health and substance use disorder services like medically necessary inpatient hospital services, outpatient hospital services, rural health clinic services, nursing facility services, home health services, and physician services.

For example, a life-threatening drug overdose requiring an emergency room visit and subsequent hospitalization is covered, but ongoing addiction therapy after hospitalization may not be covered.

Some states may elect to cover optional mental health services like prescribed medicines (currently offered in all states) but may not cover employment and other employment services, home-based services, or peer support services. 

A mental health billing service will know which state Medicaid mental health services are covered and which are not. 

Medicare is like Medicaid and covers many of the same services. In fact, Medicare covers all mental health services except those on the following list.

Non-covered Medicare Fee-for-Service Mental Health Services include:

  • Environmental intervention or modifications
  • Adult day health programs
  • Biofeedback training (any modality)
  • Marriage Counseling
  • Pastoral Counseling
  • Report preparation
  • Results or data interpretation or explanation
  • Hemodialysis specifically for treating schizophrenia (experimental)
  • Transportation or outpatient meals
  • Phone services, or "Apps."

Medicare also details which professionals that are eligible to provide mental health services.

The list of professionals include:

  • Physicians (Medical Doctors [M.D.'s] and Doctors of Osteopathy [Dos]), particularly Psychiatrists
  • Clinical Psychologists (CPs)
  • Clinical Social Workers (CSWs)
  • Clinical Nurse Specialists (CNSs)
  • Nurse Practitioners (NPs)
  • Physician Assistants (PAs)
  • Certified Nurse-Midwives (CNMs)
  • Independently Practicing Psychologists (IPPs)

Medicare covers medically reasonable and necessary services or supplies to treat the patient's overall diagnosis and condition. Services must meet the standards of good medical practice for diagnosis, direct care, and treatment of the patient's medical condition, and not mainly for the convenience of the patient, provider, or supplier.

Medicare states that although a provider may consider a service or test good medical practice, they will not pay for services without patient symptoms, complaints, or specific documentation.

A mental health billing services company will be aware of the rules and regulations for submitting claims to Medicare, helping you avoid the dreaded claim denial. 

Lastly, we will explore Private insurers' mental health services coverage.

In the past, many insurance providers did not cover the cost of mental health services. However, the Mental Health Parity and Addiction Equality Act of 2008 prohibits private insurers from discriminating against people with mental health diagnoses of providers who offer mental health services.

In other words, private insurers must now cover mental health care to the same degree that they cover other health care services.

When submitting claims to a private insurer, mental health practices should know that many commercial insurers outsource their mental health claims to an outside third party. It's important to note because the claims address on the patient's insurance card isn't always the correct address, and the claims will be denied if you submit them to the wrong address.

Lastly, mental health practices that have contracted with insurance companies cannot balance bill their patients. They must accept the insurer's rate and write off any remaining balance.

Given the different rules, regulations, and nuances for Medicare, Medicaid, and Private Insurers, working with a mental health billing services company will improve a mental health practice's collection rate, helping them collect 96% or more of the money owed to them.