Current Landscape for Digital Therapeutic App Reimbursement

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One path to business viability for digital therapeutic companies relies on models of reimbursement for their product. Health care is incredibility complex and so are the payment mechanisms. Digital provides new opportunities and new challenges for new models for reimbursement to emerge. In large part, it requires clarity on what problem the digital therapeutic is reliably solving, for whom and for how long.

Adam Powell and colleagues provide an update on the current landscape for mental health app reimbursement in the Journal of Medical Internet Research. There is a lot of heterogeneity in who is paying for apps. In some cases, larger employer groups will provide free access to apps for employees as a way to support population health. Some early adopter health systems are seeing the value these tools can bring to their models of care and also see their use as a meant to differentiate themselves from competitors. Many products are also available in the App Store and Google Play for consumers to purchase on their terms.

Below see the various mechanisms for app reimbursement that exist today. At a high level, there are six different paths which reflect the diverse array of players in the space. Paths also differ if apps focus on prevention, diagnosis, symptom monitoring and management for chronic conditions.

Screenshot 2019-09-24 15.17.54

Source: (JMIR Ment Health 2019;6(8):e14724) DOI: 10.2196/14724

Recently the American Medical Association (AMA) released new Clinical Procedural Terminology (CPT) codes for digital health which signals an intent that these tools are indeed becoming a standard of care to help manage chronic conditions. This will enable digital health solutions to gain further traction in more traditional care models. An additional avenue is via the Healthcare Common Procedure Coding System (HCPCS) as laid out by the Centres for Medicare and Medicaid Services (CMS). CPT codes are a subset of these larger HCPCS codes and are still grappling with the digital era. These codes don’t yet enjoy broad uptake in part due to a concern of misrepresenting visit types of what the code could actually be applied to and also because models of care that allow for a digital health remote monitoring remain nascent.

I can foresee more movement in the value-based payment model space- a model that has gained prominence in the post-2010 Affordable Care Act (ACA) era where people will pay for outcomes and value versus volume of procedures conducted.

For all this to work new models of care beyond the doctor lead care will need to emerge to allow additional provider types to leverage apps fully- in part, CPT codes focus on procedures and can apps be considered procedures? We need an evolution in how codes are developed to accommodate the myriad of ways app functionality can support mental health either as augmenting care or as stand-alone support. New models of care also need to emerge to allow space for these new tools to be embedded in care. It is a very exciting time in digital health.


Thanks for reading – Trina
(My Opinions are my own)



Reimbursement of Apps for Mental Health Findings from Interviews.

AMA and CPT Codes


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