Psychiatrists, therapists, and all mental health providers need to have good knowledge about billing and coding to receive payments for their services. Treatments and care plans need to be properly documented, billed, and pursued to be properly compensated.
Let’s look at the work required by providers, billers, and coders for mental health billing.
4 Key Challenges in Mental Health Billing and Coding
Billing and coding for mental health services come with unique challenges that differ from other specialties:
1. Complex Diagnoses
Mental health conditions often involve complex and overlapping diagnoses. Accurately coding these conditions requires a thorough understanding of the DSM-5 (Diagnostic and Statistical Manual of Mental Disorders) and ICD-10 (International Classification of Diseases, 10th Revision). It is a good idea to keep coding books handy to avoid guessing, which often results in coding errors.
2. Time-Based Codes
Many mental health services, such as psychotherapy, are billed based on the time spent with the patient. This requires precise documentation and an understanding of the specific codes for different time intervals (e.g., 30 minutes, 45 minutes, 60 minutes). Some software is set to auto-populate visit codes. I ask all mental health professionals not to rely on software-generated codes. This practice often leads to inaccurate coding.
3. Coverage Variability
Insurance coverage for mental health services can vary significantly.
Some plans may have limited coverage or require pre-authorization, which adds an additional layer of complexity to the billing process. Some insurance plans allow a set number of covered therapy sessions without authorization.
If you exceed the allowed numbers, pre-authorization will be required for additional therapies. There is no shortcut to identifying insurance requirements and benefits. Coverage verification must be done prior to the patient’s visits by using insurance portals and directly calling insurance.
4. Telehealth Services
The rise of telehealth, particularly during and after the COVID-19 pandemic, has introduced new challenges in mental health billing and coding.
Providers must document telehealth services stating the mode of communication; video and audio sessions are now required. Please check your state and payer requirements. If you ask a patient to come into the office for additional services on the same day as televisit, you might need an unrelated diagnosis to bill for the televisit.
Best Practices for Mental Health Billing and Coding
Given the strict government and insurance guidelines, it is essential to implement best practices to ensure accuracy and efficiency in mental health billing and coding:
- Stay Informed: Keep in touch with your specialty associations, such as American Psychiatric Association. Also, register with insurance to receive newsletters on changes or new requirements. Insurances can change mailing address, pre-authorization requirements, provider revalidation process, and local coverage determination (LCD), along with other billing rules.
Read the mails and emails you receive from insurance to learn about new guidelines, including changes to the DSM, ICD, and CPT (Current Procedural Terminology) codes. Subscribe to industry newsletters, attend webinars, and participate in professional organizations. - Use Specialized Software: Invest in billing and coding software designed specifically for mental health practices. These tools can automate many aspects of the process, reduce errors, and streamline claim submission. Good software will also provide meaningful reports to improve billing and coding.
- Conduct Regular Audits: Periodically review your billing and coding processes to identify and correct errors. Self-audits can help ensure compliance and prevent lengthy insurance audits and refunds, which can go back seven or more years and greatly hurt the practice.
- Train Staff Continuously: Provide ongoing training for staff to ensure they are up to date with the latest guidelines and best practices. Consider partnering with a competent billing team who can guide everyone in the practice through the insurance web.
- Collaborate with Insurers: Establish strong communication channels with local insurance managers. Understanding their specific requirements and guidelines can help reduce claim rejections and improve the speed of reimbursement.
The Importance of Accurate Billing and Coding
Mental health billing and coding require adherence to strict documentation rules, which demand precise identification of services, documenting guidelines, and supporting diagnoses. Proper insurance billing and coding are essential for several reasons.
- Compliance: Proper coding ensures compliance with federal regulations, including those set by the Health Insurance Portability and Accountability Act (HIPAA) and the Centers for Medicare & Medicaid Services (CMS). Non-compliance can lead to rejected and aging claims, audits, and refunds. Make a table of commonly billed codes and note insurance guidelines on how to bill them. Initiate your list with Medicare guidelines; this is a good place to start.
- Reimbursement: Insurance companies and government programs rely on accurate codes and supporting documentation to process claims. Coding errors, such as incorrect E&M code level or missing documentation for time, can lead to denied or delayed payments, affecting the financial health of the practice and the ability to continue providing services. Check your code cheat sheet often to identify that your documentation meets the definition of the codes you are billing.
- Patient Care: Accurate documentation through proper coding helps maintain a comprehensive record of a patient’s mental health history. This information is crucial for ongoing treatment and acquiring pre-authorization for future services. Insurance companies will often ask for medical records before claim payments and authorizations are issued.
Final Words
Investing your time to build a strong billing team can ensure your practice’s success. A strong billing team can give you continuous feedback on proper coding and help streamline the billing process. Insurance companies create new coverage plans every year.
An expert billing team will be able to provide credentialing services with high reimbursement plans and negotiate fees to ensure the highest compensation for your claims.
At FC Billing, we specialize in establishing new psychiatry practices and greatly increasing income for mental health practices.
