From The National Psychologist, Vol. 15 No. 2

March/April 2006 issue, page 4


New testing codes create winners, losers

  By Paula Hartman-Stein, Ph.D.

            In January psychologists who perform testing services either had a raise in income or a major reduction.

Why the change? For the first time in the history of third-party payment for clinical services, testing codes have been assigned work values and new regulations about their use. Geographic location and knowledge of correct coding procedures are determining the financial impact.

            According to Tony Puente, Ph.D., the APA representative to the American Medical Association’s Current Procedural Terminology (CPT) Committee, reimbursement for testing services performed directly by licensed psychologists increased from 22 percent to 69 percent. Yet there are disgruntled psychologists.

            “The average level of psychologists’ knowledge of coding, billing and documentation is low,” says Puente. “Some people don’t understand what a unit of billing is. So when you add a change to a foundation that is relatively unstable and incomplete, you have the present scenario of misunderstanding.”

            Some of the frustration is a result of current non-payment of claims. Neil Pliskin, Ph.D., chairman of the Practice Advisory Committee of APA’s Division of Neuropsychology, explained, “The codes are not yet widely recognized by private insurance carriers. But the surprise has been that some local Medicare carriers have policies under which coverage is denied or unclear.” As of mid-February there were technological problems in Massachusetts and California and policy issues in Minnesota, Wisconsin, Illinois and Michigan.

            Magellan, a large managed care company, reviewed the new codes in November 2005 and determined they would not cover the new technician codes but recently reversed that decision. Ted Peck, Ph.D., director of the Professional Affairs and Information Committee for the National Academy of Neuropsychology (NAN), said, “What I see going on is a period where both psychologists and insurance companies are trying to understand very drastic and important changes with the deletion of old testing codes and implementation of new ones.”

            Peck said some commercial carriers misunderstood the new technician code. “They were initially concerned about the time, cost and labor that would be involved if they had to credential a new class of providers.” Once managed care administrators understood that the technician would not need to be separately credentialed, more allowed the technician billing code.

            Peck categorized the problems into several categories. One is a computer software issue whereby code numbers higher than 96117, have been blocked. “This is an innocent issue,” said Peck, “one that is readily addressed.” Newly added code numbers, for example, are 96118, 96119, and 96120.

            Uncertainty regarding how many billing units are appropriate for psychologists to bill for their interpretation of test data and write up of reports is another topic for the flood of e-mail questions that Peck, Pliskin and Puente receive each day. “There are no specific guidelines for this. Billing is supposed to be related to actual time spent in these activities,” said Peck.

            With the adoption of CPT codes 96102 and 96119, the work of technicians is clearly acknowledged for the first time, yet some psychologists in academic and hospital-based settings are not pleased. For example, Rose Lynn Sherr, Ph.D., director of Outpatient Psychology at the Risk Institute of Rehabilitation Medicine of New York University Medical Center said, “The new codes are for technicians, not for high-level pre- and post-doctoral trainees. With the new codes we cannot charge for their scoring and writing time so our charges for neuropsychological evaluations are ridiculously low, a great blow to the service institutions that support our training.”

            Puente does not see the label of technician as demeaning. Anyone who does not have the contractual obligation to the insurer and is under the supervision of the licensed psychologist has the role of technician, he said. The technician and professional codes are interdependent. Puente said that CPT code 96119, neuropsychological testing with the technician spending face-to-face time with the patient, cannot be billed unless code 96118, the professional service, also occurs.

            “Greater parity and engagement in the health care system requires greater transparency, accountability and uniformity in what we do,” said Puente. He believes that the liberal arts tradition in psychology training programs conflicts with the traditions in training and practice of most health care professionals. “I have made the choice of embracing the accountability tradition inherent in health care. Our future lies in the professionalism of our discipline.”

            Several professional groups agree that psychologists need more training in coding and billing. NAN and Division 40 are co-sponsoring a free webcast tutorial with Puente at the helm in the near future. At the 2006 APA convention two symposia are scheduled thus far on coding, one organized by Division 40 and another by Donna Rasin-Waters,

Ph.D., from Division 12. The directorate is currently developing a toolkit to help address claim rejections.

Websites and (from the Society for Personality Assessment) address frequently asked questions about the coding problems and provide sample scenarios for billing the new codes.


            Paula Hartman-Stein, Ph.D., is a consultant, trainer and practitioner in Kent, Ohio, specializing in geropsychology. She can be reached through e-mail,










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