(Reprinted from NAN Website:


The purpose of this WEB page is to make neuropsychology billing and reimbursement information widely available to practicing neuropsychologists. It is our hope that this will be an especially valuable service for neuropsychologists who have only just recently finished their training, and are now moving into practice. But it is also hoped that by making this information readily available, a more uniform approach to billing will be adopted by all neuropsychologists (we are currently dealing with significant problems in regard to insurance company data sets because of inappropriate billing procedures being used by many neuropsychologists).

This information is being compiled by Robert J. Barth, Ph.D.. Dr. Barth serves on the American Psychological Association/Division of Neuropsychology/Practice Committee. In 1996, Dr. Barth was asked by the committee to chair a sub-committee focused on billing and reimbursement issues. This WEB page represents the working notes of that sub-committee. Dr. Barth can be reached via e-mail (, telephone (423/899-4040), or snail mail (7003 Shallowford Rd, Suite 102, Chattanooga, TN, 37421).

These notes do not represent official policy of the American Psychological Association, Division 40, the Practice Committee, or even the payment and reimbursement sub-committee. It is our hope that formal, authoritative opinions can be offered in the future. But, again, for now the following information represents only a working set of principles and policies which we are considering.

This version of the web page is nothing more than Dr. Barth’s initial offering to other committee members, for the purpose of stimulating discussion. The information contained herein will no doubt change over time. Extensive consideration of these issues will take place before any formal position paper is submitted to APA for approval.

Key References:

The neuropsychologist who is seeking to learn as much as possible about billing and reimbursement should consult the following references:

1) The combined works of Tony Puente, Ph.D.

Dr. Puente is the nation’s leader on the subject of neuropsychology billing. He has presented at each of the National Academy of Neuropsychology conferences over the past several years, and his presentations are available on audio tape through the Academy’s vendor (contact the academy for more specific information). His writings on this subject have appeared in the Academy’s Bulletin, and in other publications such as The National Psychologist. Dr. Puente has provided a general reference guide of billing codes, which is included in the Academy’s directory. Dr. Puente’s updates on this subject are often available through the National Academy of Neuropsychology’s WEB Page.

2) The NAN presentations of Ted Peck.

Dr. Peck has presented extensive discussions of neuropsychology business practices at the annual meetings of the National Academy of Neuropsychology. His presentations are available on audio tape, from the Academy’s vendor. Dr. Peck has also historically made his handouts from those presentations available, for a minimal charge. He can be contacted through the address and telephone information available in the Academy’s directory.

3) PMIC’s Physicians Fees.

This book is published every year, with updated information on usual and customary rates for all procedure codes, and relative value units for all procedure codes. Examples of this information include the following:

Table 1: Example of PMIC Data:

This paper firmly establishes principle #1 below. It also single-handedly overrules the claims sometimes made by certain insurance companies that neuropsychology is an “investigational” service (such a label is used to indicate that a service does not have established credibility and is subsequently not reimbursable by insurance ).4) The 1996 American Academy of Neurology position paper on neuropsychology (Neurology 1996; 47: 592-599).


Basic Principles:
Principle 1: Neuropsychologists should only use medical diagnoses.

Psychiatric diagnoses must be avoided whenever possible.

Many years ago, when it was appropriate for neuropsychologists to be using psychiatric CPT codes, an unfortunate practice developed of inventing psychiatric diagnoses in order to maintain consistency with those psychiatric billing codes. The classic example of such a diagnosis is “organic personality syndrome”. Although this type of diagnosis was essentially meaningless and redundant of the neurological diagnosis, it had the unfortunate effect of incorrectly implying that the patient was demonstrating some psychiatric disturbance which was distinct from his/her neurological difficulties.

Several years back, the option of using psychiatric CPT codes was eliminated (thanks to the hard work of Tony Puente). Subsequently, there has no longer been any need to invent psychiatric diagnoses to accompany the neuropsychology CPT codes.

In fact, psychiatric diagnoses should be completely avoided, in order to minimize confusion. Neuropsychology bills are extremely vulnerable to misinterpretation. The “Ph.D.” after our names often causes insurance companies to assume that the bill must be for mental and nervous services. Needless to say, if the bill has a DSM-IV diagnosis listed, then it will almost certainly be misinterpreted as a mental and nervous bill. This causes undue financial hardship for the patient (because of the lower reimbursement rates for mental and nervous services), can inappropriately compromise their psychiatric benefits (because of the annual and lifetime limits which are often placed on the mental health portion of an insurance policy), and inappropriately stigmatizes a patient as having a psychiatric condition (in our experience, this has been most troubling for patients who are applying for social security disability benefits).

In conclusion, the diagnostic code must be consistent with the patient’s presentation. Neuropsychologists serve patients because of medical reasons. Therefore, the medical diagnosis must be utilized. For example, a brain injury case should be billed with a brain injury diagnosis, rather than with organic personality syndrome or any other psychiatric diagnosis. Diagnoses which are commonly used by neuropsychologists include brain injury, concussion, stroke, toxic encephalopathy, Lupus, Multiple Sclerosis, Diabetes, Hypertension, and Encephalopathy Unspecified (this last diagnosis is especially helpful for conditions which are of unknown etiology, such as learning disabilities and apparent dementia. Unfortunately, some insurance companies will not accept it.).

Principle 2: Neuropsychology billing should use the appropriate CPT codes.

These codes are now categorized as “central nervous system assessments”, and have the 96 prefix. The 95 prefix codes which preceded them have been discontinued. The 90 prefix codes (psychiatric) which were once an alternative for neuropsychology, are no longer an alternative.

The codes are listed below, but the reader is also referred to the updates from Dr. Puente, which are commonly posted on the National Academy of Neuropsychology’s WEB page.

Central Nervous System Assessments/Tests (eg, Neuro-Cognitive, Mental Status, Speech Testing):

Most neuropsychologists have found that billing can be significantly simplified by using only 96115 and 96117. Insurance companies have apparently had difficulty creating usual and customary data for 96115. Subsequently, 96117 is the safest code to use (the one which will produce the most reliable response form insurance companies).

Principle 3: All billing takes place on an hourly basis.

The CPT codes are now defined in a manner which specifically indicates that they represent an hour of service. Subsequently, the amount of time involved is indicated on the billing form by placing a number in the “Units” column which represents how many hours of service were provided.

There are no codes for partial hours of service. Puente recommends rounding up or down to the nearest whole hour. In my own practice, we have occasionally billed fractions of units. Most of the time the insurance companies have accepted this without question, but in a few instances the insurance company has simply ignored the fractions (in other words, they failed to pay us for that time) .

In the past, some practitioners have billed on a per-test or per-battery basis, and this is no longer acceptable. That approach unfairly discriminated against patients who made their way through the testing process quickly, because they were subsidizing the care of patients who made their way through the testing process very slowly.

Additionally, billing on a per-test or per-battery basis is recommended against because it would introduce erroneous data into the insurance company files. Because of the manner in which the CPT codes are now defined, the insurance company would misinterpret the test or battery charge as being an hourly charge. This could lead to such conclusions as:

  • ) “Neuropsychologist A is charging $1,000/hour”, because a battery charge was being misrepresented as an hourly charge, or…
  • ) “Neuropsychologist B is charging $7.50/hour”, because a three minute test (e.g. COWA) is being misrepresented as an hour of testing.

The insurances companies are already having significant difficulty gathering usual and customary data for neuropsychology. We cannot afford to be introducing further confusion by billing on a per-test or per-battery basis.

Principle 4: The neuropsychologist should bill for every minute of service devoted to a particular patient.

The CPT codes have been written to insure that the neuropsychologist bills for any preparation time, scoring of tests, review of medical records, interpretation of results, dictation of reports, and any other time which was devoted to a particular patient’s care, even if the neuropsychologist was not physically in the company of the patient at the time the service was delivered (as is always the case for most of the services listed in this paragraph).

The importance of this point may seem obvious, but it is being emphasized within these notes because violations of this policy have come to our attention. Specifically, certain hospitals have prohibited their neuropsychologists from billing for time which is not spent in the company of the patient. We are emphatically stating that a policy such as that is completely wrong, and is in violation of the written definition of the CPT codes. The illogical nature of such a policy can be demonstrated by applying it to those doctors who never see a patient. For example, if a similar policy were applied to pathologists or radiologists, then those physicians would never have an opportunity to bill for their services.

It has also come to our attention that patients have sometimes complained about being billed for time that they did not spend with the doctor. The CPT codes have been written in a manner which supports the doctor in the billing of the patients for any time devoted to that patient’s care. But the doctor and his/her staff should not simply argue with the patient and hold up the CPT code definitions as a defense. Instead, it is strongly recommended that the doctor and/or the doctor’s staff take the necessary time to fully inform the patient of the nature of the time which was devoted to their care, and to explain that the time which the doctor actually spent with the patient would be meaningless if the doctor were only allowed to score, interpret, and document findings. Introducing these issues in advance of providing services is often helpful.

Principle 5: Depositions and Court Room Testimony.

This Principle is based on the extremely aversive and risky nature of this activity. Specifically, this is the only part of our work which involves submitting ourselves to unfounded character attacks and attempts by attorneys to publicly humiliate us and thereby jeopardize our careers. Neuropsychologists simply should not subject themselves to such hazardous duty unless they are compensated at a higher rate than the fees they charge for normal clinical work.

Our sub-committee is currently researching this issue, gathering as much data as possible. All of the data we have obtained so far indicates that doctors of all specialties charge more for deposition time, than for clinical service time. For example, in 1997, PMIC has reported $280/hour as the 50th percentile for medical testimony. A more extreme example comes from a prominent medical college, which has recently issued a policy requiring all faculty members to charge $515/hour for depositions and testimony. For the neuropsychologists on staff, this charge is more than a 100% increase over usual and customary rates for clinical services.

A secondary, but probably more important point, is that all deposition and testimony time should be paid in advance. This is absolutely crucial, because of the extremely high no-show and late cancellation rate for depositions and court room testimony. The doctor is advised to never make a formal/final commitment to deposition time or testimony time until the requesting parties have specified the time involved, and made the necessary payment in advance. In other words, such time should not even be held on the doctor’s schedule, until a non-refundable payment has been made to specifically hold that time.

In order to insure the accuracy of the testimony and the deposition transcript, the doctor should insist on being paid to review the relevant chart/patient information in advance, and the doctor should also insist on being paid to proofread the transcript (and make any necessary corrections). In our experience, we have never seen a deposition transcript which was accurate. Some attorneys have protested this part of our policy, but others have strongly supported it.

Sample deposition and testimony policies are included as appendices of this page.

Principle 6: Always Verify Benefits Before Seeing the Patient.

Provide the insurance company with the referral (medical) diagnosis and the proposed procedure codes. Find out from the insurance company whether the patient has benefits for that diagnosis and those procedures, whether there are any limits on that coverage, and the actual rate of reimbursement for each unit of the procedures. All of this information should be communicated to the patient/family in advance so that they will know the exact nature of the financial responsibility they are assuming.

Other Issues to Consider
1) Medicare

Quite unfortunately, Medicare is an extremely problematic reimbursement system which should probably be avoided if at all possible. The primary problem with Medicare is that it involves numerous regulations which are counter-intuitive and which are are not readily accessible, but which, when violated, will render the doctor vulnerable to accusations of “fraud” (Medicare does not simply accuse people of failing to know the rules, it always uses the word “fraud”).

An example is the Medicare guideline which forbids a neuropsychologist from billing for the work of an assistant with a hospitalized patient. This regulation compromises patient care, places an unnecessary financial burden on the Medicare system, and is contrary to standard practice. However, efforts to change this regulation have failed historically (for reasons which are incredibly illogical). Because this regulation is contrary to standard practice, neuropsychologists are extremely vulnerable to not knowing about the regulation, acting in a manner which violates the regulation, and then being accused of “fraud” when Medicare discovers that the regulation has been violated.

The risk of being accused of “fraud” is essentially intolerable, and should not be accepted by neuropsychologists. This is the basis of my recommending that neuropsychologists try to avoid Medicare reimbursement. However, this situation is especially intolerable given the fact that most doctors are reimbursed by Medicare at 60 or 70 percent of usual and customary, but neuropsychologists are reimbursed by Medicare at approximately 20 percent of usual and customary. The rate of reimbursement by Medicare in most states does not even cover the cost of providing the patient with neuropsychological services. When combined with the vulnerability to “fraud” accusations, seeking reimbursement through Medicare is essentially unsupportable from a business perspective.

The situation is made even worse by the unreliability of reimbursement through Medicare. Even though the system claims that some minimal reimbursement is available, is some states the Medicare administrators have demonstrated a concerted effort to avoid ever paying any of the bills. The burden for such failure to pay cannot legally be passed on to the patient, so there is no motivation for the patient to assist the doctor in efforts to gain reimbursement.

This set of circumstances could potentially create a crisis within geriatric service delivery, because of the high need for neuropsychological services in that population, coupled with the almost universal coverage of geriatric patients by Medicare. I have no solutions to offer for this problem at the current time, but I am hopeful that solutions may be developed/proposed as we work to heighten general awareness of the problems.

In our practice, when we are asked to see a patient who is covered by Medicare, we have found it more economical to provide services on a charity basis rather than to waste time interacting with the Medicare administrative systems.

2) Medicaid

In our experience, Medicaid is not a realistic reimbursement system for neuropsychology. The reliability of reimbursement from Medicaid is even worse than the reliability of reimbursement through Medicare. Even when reimbursement is available, the rates of reimbursement are not significantly different from zero.

We have heard about some rare exceptions to this general trend. For example, some states reportedly provide meaningful and reliable Medicaid reimbursement when the services are provided to children. This possibility must be investigated locally.

In our practice, when we are asked to see a patient who is covered by medicaid, we have found it more economical to provide services on a charity basis rather than to waste time interacting with the medicaid administrative systems.

3) Tax Identification Numbers/Billing Entity

The billing entity and tax id number which is used to complete a neuropsychologist’s billing form should be carefully constructed to avoid using the word “psychology” or a psychology degree designation (e.g. Ph.D., Ed.D., Psy.D.).

Insurance companies claim that decisions regarding whether a claim is paid as medical/surgical or nervous/mental are based on the diagnosis and procedure codes.

However, in our experience, they have often misinterpreted a claim as nervous/mental simply because of the Ph.D. after my name or because the billing entity (the practice) had the word “neuropsychology” in it’s title. Subsequently, we have eliminated any form of the word “psychology” from our corporate name, and have linked our tax ID number strictly to this corporate name, rather than linking it to the names (and doctoral degrees) of the practitioners. Since we did this, we are far less frequently plagued by misinterpreted claims.

4) What To Do When the Insurance Company Classifies You as Mental/Nervous

Occasionally, insurance companies attempt to classify neuropsychological services as nervous/mental (even when the appropriate diagnostic and procedure codes have been utilized). This classification is wrong to begin with, and it tends to penalize patients by paying lower benefits for the neuropsych services, and incorrectly cutting into their nervous/mental benefits (which are often segregated from other healthcare benefits, and which are often limited by annual and lifetime maximums).

I was recently asked to meet with a medical director and several executives of a major regional insurance company for the purpose of helping them to determine whether neuropsychology should be paid as nervous/mental or medical/surgical. Similar requests have been made to other neuropsychologists in other states previously, and we can probably expect such requests to be made again in the future. Subsequently, I am using this chapter to share the basic argument and references I used to successfully convince this company to pay for neuropsychology as a medical/surgical service.

The summary letter I provided to this company addressed the following points:

  • ) Neuropsychology’s status as a medical/surgical discipline is demonstrated by the typical medical school structure (e.g., The University of Alabama-Birmingham), in that neuropsychology departments can be found in the Department of Neurology, the Department of Surgery, and the Physical Rehabilitation Department, but not in the Psychiatry Department.
  • ) The mis-classification of neuropsychology as a mental/nervous service apparently stems from the fact that most psychologists now practice within mental healthcare, but this is a relatively recent development, and the longer history of psychology is that it has always been involved in neurology, even before it was involved in psychiatry.
  • ) Our patients are not being referred to us for mental health purposes, but are instead being referred for evaluation of their medical status, and planning of their medical treatment.
  • ) Our CPT codes are classified as “Central Nervous System Assessments”, rather than being classified as “Psychiatric” (the opportunity to bill neuropsychological services as a psychiatric procedures was eliminated approximately five years ago).
  • ) Medicare has classified neuropsychological testing as a procedure for evaluating medical disorders.
  • ) Authoritative psychiatric textbooks (such as Kaplan and Sadock’s Comprehensive Textbook of Psychiatry) identify neuropsychology as an extension of the neurological examination, rather than being part of the psychiatric evaluation process.

The materials I included with this summary letter were:

  • ) The American Academy of Neurology’s position statement on Neuropsychology from 1996, which documents neuropsychology’s status as an “established” neurological service.
  • ) The neuropsychology sections from standard medical textbooks, such as Principals of Neurology (Adams et al), Neurology and Trauma (Evans), Neurology in Clinical Practice (Bradley et al), and Systemic Lupus Erythematosus (Lahaita). The purpose of these chapters was to illustrate that neuropsychology is part of medical practice, rather than being part of psychiatric practice.
  • ) Finally, I included several papers from my own files. One of these was an Introduction to Neuropsychology which I wrote and have been using for purposes of teaching family practice residents in a local training program. The other documents were work samples, which illustrated that our neuropsychological evaluations have been utilized for lupus patients, neurosurgical patients, stroke patients, and brain injury patients.
5) The Special Problem of Dementia

Even though there is universal agreement in the medical world that Alzheimer’s and other forms of dementia are neurological/medical problems, the inclusion of these diagnoses in DSM-IV has put the insurance companies in a position to claim that these disorders are psychiatric. Subsequently, the insurance companies have adopted policies to pay for these disorders under their nervous/mental guidelines rather than under their medical/surgical guidelines, no matter what type of doctor is providing the services.

We are essentially stuck with this problem, because the American Academy of Neurology has chosen not to fight against it. Apparently, if the situation were corrected, a reclassification of the dementias as neurological conditions might jeopardize the ability of psychiatrists to bill under those diagnoses. Subsequently, AAN has informed its membership that they should simply expect to be paid at nervous/mental rates if they use a dementia diagnosis.

We have a few recommendations to make about this predicament. If an encephalopathy diagnosis might be appropriate for a case of suspected dementia, then the billing would probably be more successful if the encephalopathy diagnosis were used. The easiest example is to use a toxic encephalopathy diagnosis rather than an alcohol or substance abuse-related dementia diagnosis.

Additionally, we have had some success by appealing to insurance company medical directors. We fully expect most such appeals to be met with a response such as, “We are sorry but that’s the company policy”. However, in rare occasions, the company’s medical director has decided that truth and reason should take priority over company policy, and has subsequently ordered the claims to be paid as medical/surgical.