Since Medicare is a zero-sum game, when there is an increase in the value of any CPT codes, the value of other codes must be decreased to maintain budget neutrality. A “budget neutrality adjuster” is applied to the relative value of all the procedure codes to make things even out.   Prior to the July 2008 passage of the Medicare Improvements for Patients and Providers Act of 2008 (MIPPA), the budget neutrality adjuster was only applied to work relative value units (RVUs) of each CPT code.  This was particularly rough on psychiatrists and other physicians like internists who primarily use CPT codes that are rated heavily on the work they do rather than on their office expenses (which includes pricey medical equipment used by many other specialists) and insurance payments.  Under MIPPA the budget neutrality adjuster is now applied to the overall conversion factor rather than just to the work values, which means any decrease is applied equally across all services.  The APA and AMA had long lobbied for this change.    

The chart below provides an example of the increase in fees for a sampling of psychiatry codes in the Chicago area.  To find the 2009 fee schedule for your locale, go to your Medicare carrier or contractor’s website.  If you need help finding the URL, call the Managed Care Help Line at 800-343-4671.