New Psychedelic CPT Codes: Paving the Way for a New Age of Psychiatric Care

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On June 4, the US Food and Drug Administration’s Psychopharmacologic Drugs Advisory Committee will host a meeting that could bring the US closer to a new age in the management of psychiatric illnesses, with the committee preparing to discuss an application from Lykos Therapeutics for midomafetamine (MDMA) capsules in management of post-traumatic stress disorder (PTSD).^1,2

However, despite the fervor, this is not the first signal of this new era to come in 2024. On January 1, 2024, the American Medical Association’s current procedural terminology (CPT) III codes for psychedelic-assisted therapies took effect.³ The codes enable healthcare providers to seek coverage and reimbursement for the monitoring and intervention of these treatments. With the upcoming advisory committee on the horizon, these codes are crucial, and growing in importance, for practitioners prescribing psychedelic-assisted therapy to know.¹

“Medical Association worked in conjunction with Lykos and Compass Pathways and other psychedelic biotech to develop billing codes, so that if these are approved, that they can go right into clinical practice, and providers can be reimbursed for those,” Brian Barnett, MD, from the Center for Behavioral Health, Neurological Institute at Cleveland Clinic, explained to HCPLive. “The codes that have been developed cover monitoring services for the psychedelic treatment, dosing day itself, and they would allow billing for a primary provider to be present during the dosing session, as well as additional codes for other healthcare providers who might be assisting the primary monitor.”

The new CPT III code, 0820T, would be for the primary provider and the modifier codes, 0821 and 0822, would cover reimbursement for an additional qualified healthcare professional and for clinical staff, respectively.⁴ The codes will allow for different durations of treatment since research found psychedelics can last anywhere from less than an hour to 12 hours.

If approved, MDMA-Assisted-Therapy will be the first treatment to use the new CPT III codes. These CPT III codes are only a temporary measure, used for experimental treatments gathering data to validate usage. Once receiving an FDA approval, permanent CPT I codes will be assigned relative value units, based on the assessment of the work a service takes in regular clinical visits or procedures, for coverage and reimbursement.

The new codes will impact all future psychedelic-assisted therapies in the pipeline when FDA-approved, such as with psilocybin, ayahuasca (DMT), and LSD.

Psychedelics’ Decline and Rise in Healthcare

Studying psychedelics in healthcare has been an endeavor fraught with hurdles for decades. Not only are psychedelic medicines illegal, but they are difficult to study relative to the more traditional therapies in medicine.

In the early 1970s, the FDA required approval of investigational drugs and mandated rigorous trial designs, making it harder for investigators conducting ethically questionable studies.

At APA 2024, Franklin King, MD, from the Massachusetts General Hospital, said it’s impossible to blind a psychedelic study. Even if they try, many participants in a placebo-controlled trial will know if they had received a psychedelic or the placebo.

Psychedelic research slowed in the last several decades but returned in recent years at Johns Hopkins University and other institutions. The first psilocybin study at Johns Hopkins focused on psilocybin and end-of-life anxiety, bringing positive results. The trial, conducted in this “wave of the psychedelic renaissance,” dubbed by Reid Robinson, MD, MBA, the principal investigator at Numinus, jumpstarted a series of research at Johns Hopkins Imperial College in the UK and other institutions.

Now, John Hopkins and other institutions continue conducting studies with psychedelics.

“It's moving full speed ahead in these multi-site phase three studies,” Robinson told HCPLive. “There is more work to do on the regulatory front because once these medicines obtain approval, if they do, that will likely involve rescheduling of what was previously a schedule 1 medicine to something that could be prescribed in a safe and effective way.”

New Codes Remove Hesitation on Prescribing Treatments

However, many physicians hesitate with these newer treatment options, wondering, how will they get reimbursed for delivering that care? It may also be difficult navigating the right billing codes for a treatment which will impact reimbursements.

“I was an early adopter of both ketamine off label and esketamine once it was FDA approved, and in the early days after esketamine approval, it was a bit tricky to know what the right billing codes were to submit for the patient monitoring and the medicine itself,” Robinson said. “I think the field is learning as we go and coming up with these things in advance of these approvals.”

Despite the difficulty at first, Robinson now uses the billing code for esketamine all the time without issue and said it provides good coverage for his patients with testosterone replacement therapy.

“And so, when MDMA gets approved, if it does obtain FDA approval, we'll have these billing codes that will cover the two therapists time and some of the other activities around that like the prescribing of MDMA and the staff support, which will be crucial parts to be able to roll this out in the real world.”

However, some providers might choose to not offer ketamine. After all, intravenous ketamine is often not covered by insurance.

“A lot of healthcare systems don't offer intravenous ketamine as a clinical care option because there is no reimbursement way available,” Manish Jha, MD, associate professor at the department of psychiatry at UT Southwestern Medical Center, told HCPLive. “That's where the CPT codes become really helpful… it allows for health care systems to be able to then start offering that as part of their care,” Jha said.

For psychedelic-assisted therapies in the pipeline—like MDMA—the new codes will clear concerns on how these treatments will be reimbursed. Now, the community is waiting for FDA committee’s opinion, as well as the subsequent regulatory decision, for MDMA.

Based on the research, patients appear to have an easier time building trust with the therapist or revising their trauma with MDMA-assisted therapy. Struggling to build trust or revisit trauma are reasons why patients often drop out of other trauma-focused therapies.

“MDMA is a really interesting molecule,” Barnett said. “There were observational reports, going back into the 80s, when MDMA was still being used in clinical practice that [suggests it] is helpful for a variety of psychiatric conditions, and now we’ve had multiple FDA monitored clinical trials that seem to indicate pretty impressive efficacy for PTSD in many ways. The practice of trauma-focused therapy would very much be changed by the addition of MDMA…because it seems like it allows patients to revisit trauma…and unpack it more easily.”⁵

References

1. ^{Kunzmann, K. FDA Advisory Committee Meeting to Review MDMA-Assisted Therapy for PTSD. HCPLive. May 6, 2024. https://www.hcplive.com/view/fda-advisory-committee-meeting-review-mdma-assisted-therapy-ptsd. Accessed May 30, 2024.}
2. ^{Lykos Therapeutics Announces FDA Advisory Committee Meeting to Review Investigational MDMA-Assisted Therapy for PTSD. PR Newswire. May 6, 2024. https://www.prnewswire.com/news-releases/lykos-therapeutics-announces-fda-advisory-committee-meeting-to-review-investigational-mdma-assisted-therapy-for-ptsd-302137204.html. Accessed May 30, 2024.}
3. ^{Smith, B. AMA CPT III Codes For Psychedelic-Assisted Therapies Take Effect. The Dales Report. January 2, 2024. https://thedalesreport.com/psychedelics/ama-cpt-iii-codes-for-psychedelic-assisted-therapies-take-effect/. Accessed May 30, 2024.}
4. ^{Valentino, T. CPT III Codes for Psychedelic-Assisted Therapies Take Effect. Psychiatry & Behavioral Health Learning Network. January 5, 2024. https://www.hmpgloballearningnetwork.com/site/pcn/news/cpt-iii-codes-psychedelic-assisted-therapies-take-effect#:~:text=The%20result%20of%20the%20organizations,qualified%20healthcare%20professional%20and%20for. Accessed May 30, 2024.}
5. ^{Derman, C. MDMA-Assisted Therapy for PTSD Awaits FDA Decision. HCPLive. December 21, 2023. https://www.hcplive.com/view/mdma-assisted-therapy-for-ptsd-awaits-fda-decision. Accessed May 30, 2024.}