Legislation May Dramatically Increase Access to Mental Health Services for Medicare Patients

Pending legislation could usher in the ability for older and disabled Americans to access hundreds of thousands more behavioral health care providers.

Experts say outdated policies currently limit many Medicare policyholders’ behavioral health care options because swaths of clinicians have remained ineligible for reimbursement for decades. But that could all change thanks to a bill introduced this year.

The Improving Access to Mental Health Act of 2021 proposes amending the current law that prevents these clinicians from billing Medicare for behavioral healthcare. If passed, the bill would allow clinicians to bill for 75% of a psychologist’s rate. The bill would also increase the reimbursement rate for clinical social workers (CSWs) from 75% to 85% of this physician fee schedule and allow them to bill Medicare for mental health care they provide to skilled nursing facility patients.


“A lot of Medicare beneficiaries would be unhappy to know that their choices are limited,” explained Dr. Heather Jelonek, a Dr. of Behavioral Health and former insurance company network developer.

The bill seeks to amend current law that dictates Medicare will reimburse psychiatrists and medical doctors who provide behavioral health treatments as well as CSWs for some work, but no other counselors who have completed a Master’s degree. These Master’s level counselors often specialize in services like mental health, substance abuse, and family and marriage therapy and are common providers of behavioral health care for people with commercial insurance plans.

“There are more than 140,000 licensed professional counselors across the country ready to provide needed treatment, especially in rural areas where they are often the only mental health professional available,” the American Counseling Association said in a statement, noting that licensed professional counselors, “are not able to be reimbursed by Medicare, despite the fact they have education, training, and practice rights equivalent to or greater than existing covered providers.


The Improving Access to Mental Health Act was introduced to the House of Representatives in March. Since then, a steady stream of cosponsors has cosponsored the bill, mostly recently Democratic Representatives Tom Malinowski (D-NJ-7), Jamie Raskin (D-MD-8), and Ann Kuster (D-NH-2) on Sept. 3rd.

Medicare’s so-called ‘mid-level penalty’ against Master’s-degree-level clinicians is also a source of frustration for healthcare systems like Bayless Integrated Healthcare (BIH) in Phoenix, Arizona.

“For years we have struggled with providing the same robust access to care we offer in network commercial and Medicaid managed care plans compared to Medicare Part B and Medicare Advantage plan members,” BIH CEO Justin Bayless told BHB in a recent interview.

‘the largest mental health crisis of our lifetime’

Limiting access to providers is a particularly acute problem during the ongoing COVID-19 pandemic.

The Centers for Disease Control and Prevention recommended the country “increase intervention and prevention efforts” after findings indicated that overall rates of anxiety, depression, thoughts of suicide, and increased substance use nearly doubled from 2019 to 2020.

The pandemic’s effect on older adults has been particularly acute, with one in four older adults surveyed by the University of Michigan in 2021 feeling depressed or hopeless and one in three feeling anxious.

“We are living in the largest mental health crisis of our lifetime, and the ripple effects of this pandemic will be with us for decades,” noted Bayless. “We are also experiencing an unprecedented shortage of healthcare workers, and the situation is especially dire in the mental health profession.”

Experts worry the restrictive reimbursement policy may present big problems for older adults as 10,000 Americans are now aging into Medicare daily, per U.S. Department of Health & Human Services estimates.

“If you think about it, today you have a particular licensed counselor that you see and tomorrow you turn 65,” said Jelonek. “You either have to pay out of pocket to continue […] to see your provider of choice, or find another provider.”

Jelonek noted that the solution is more complicated than simply switching to a Medicare-covered psychiatrist or medical doctor for behavioral health care. In addition to patients disrupting their continuity of care, there is also a shortage of doctorate-level providers due to the high costs and limited availability of Ph.Ds spots at universities. 

Patients who are able to switch to a doctorate-level provider once they age into Medicare may also have to pay more, however. While Medicare plans generally pay 80% of a patient’s fees once they reach their deductible, 20% of a doctor’s fee can still be higher than that of a Master’s level clinician’s fee.

“I’d be paying more out of pocket for similar services,” explained Jelonek. 

The Congressional Budget Office estimated that extending Medicare coverage to all licensed Master’s level clinicians would cost taxpayers about $100 million in the first five years and $400 million within 10 years. This represents a fraction of Medicare’s overall 2020 spending of $776.2 billion.

“The failure to treat depression often leads to more primary care visits and higher Medicare expenditures,” said the American Association for Marriage and Family Therapy in a statement. “The unavailability of qualified mental health professionals compounds the mental health crisis among the elderly population and increases the costs to the program.”

‘This is a no-brainer’

“While Master’s level clinicians mainly provide supportive counseling versus direct intervention, their work is critical, and can often help deter more serious mental health issues from developing,” said Bayless.

“Together, the licensed mental health counselors and marriage and family therapists make up 40% of the mental health workforce,” wrote Blake Edwards, a behavioral health director for Columbia Valley Community Health in Wenatchee, and a licensed marriage and family therapist, in a recent Seattle Times op-ed supporting the bill.

The reason for the restrictions on Master’s level clinician reimbursements is unclear. Medicare has covered psychiatrists, psychologists, and some care from CSWs since 1989, according to the American Counseling Association.

Jelonek and Bayless told BHB they were unsure of why these professionals remain excluded from the Medicare fee schedule. “To me, this is a no-brainer,” Jelonek said of changing the policy.

The Centers for Medicare & Medicaid Services (CMS) did not respond to a request for information on why the reimbursement issue persists. A CMS spokesperson also did not respond to Behavioral Health Business’ request for comment about the agency’s position on the pending bill.

“I would like to see Medicare reimburse all licensed Master’s level clinicians, not only because their work is so valuable, but because it would result in more access to quality care, especially among underserved and vulnerable populations,” said Bayless.

Written by By Sloane Airey

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