A New Era in Digital Behavioral Health: Medicare Embraces Digital Mental Health Treatment

Key Takeaways

• Medicare embraces digital mental health treatment: The 2025 Medicare Physician Fee Schedule (MPFS) introduces three new HCPCS Level II codes (G0552–G0554), officially recognizing and reimbursing digital mental health treatment (DMHT) services.
• New reimbursement opportunities for providers: These codes cover both the supply and onboarding of FDA-cleared DMHT devices and the ongoing monthly management of patients using those devices as part of a behavioral health treatment plan.
• Eligibility depends on compliance: Only devices cleared or authorized by the FDA under 21 CFR 882.5801 qualify for reimbursement, and providers must document active use, device data review, and patient interaction each month.
• Improved access and integration: CMS’s decision helps integrate digital behavioral health into routine care, enhancing access, reducing stigma, and encouraging patient adherence to treatment plans.
• Revenue cycle implications: For practices and billing teams, these new codes open the door to additional revenue streams but demand accurate documentation, workflow alignment, and expertise in behavioral health billing compliance.

In the 2025 revision of the Centers for Medicare & Medicaid Services (CMS) Physician Fee Schedule (PFS), digital mental health treatment (DMHT) services and devices have moved from emerging innovation to recognized reimbursable care.

For medical providers, billing professionals and revenue-cycle specialists — especially those serving behavioral health, primary care and multidisciplinary practices — this change presents a meaningful opportunity. At the same time, it raises important implementation questions around eligibility, documentation, device classification, and workflow integration.

Why This Matters: Digital Mental Health Joins the Reimbursement Fold

Historically, digital mental health services such as app-based therapy, self-guided cognitive-behavioral programs, sensor-enabled monitoring and tele psychiatry have struggled with sustainable reimbursement. Without a clear payment pathway, many innovations remained underutilized despite growing demand for accessible behavioral health support. In the new 2025 PFS, CMS has taken a key step toward legitimizing and reimbursing DMHT as part of a broader behavioral health treatment plan.

For practices and revenue cycle teams, that means:

• A new revenue stream for digital behavioral health interventions that complement traditional therapy or psychiatry.
• A strong signal that payers may increasingly recognize digital therapeutics — positioning these codes as precedent-setting.
• A potential pathway to integrate behavioral health more seamlessly into primary care and other settings, improving access while potentially reducing costs of untreated mental health conditions.

What the 2025 Rule Establishes: The Three DMHT Codes

CMS has finalized three new Healthcare Common Procedure Coding System (HCPCS) Level II codes to describe DMHT services furnished under certain criteria. The codes are:

• G0552 – Supply of a digital mental health treatment device and initial education and onboarding, per course of treatment, that augments a behavioral therapy plan.
• G0553 – First 20 minutes of monthly treatment-management services related to use of the DMHT device (includes review of device-generated patient observations/inputs and at least one interactive communication with patient/caregiver in the calendar month).
• G0554 – Each additional 20 minutes of the same monthly treatment-management service (separate listing).

These codes are intended to be incident to (i.e., furnished in conjunction with) professional behavioral health services under an established behavioral health treatment plan of care. They reflect not just device supply, but ongoing management and review of the patient’s digital-therapy usage.

Device Eligibility & Provider Requirements – What to Watch

The 2025 final rule places specific conditions on device eligibility and provider billing. Here are the key considerations for billing and coding teams:

Device eligibility

• The DMHT device must be cleared under section 510(k) of the Food, Drug & Cosmetic Act or granted de novo authorization by the Food and Drug Administration (FDA), and classified under 21 CFR 882.5801 (mental and behavioral health treatment devices).
• The billing provider must furnish the device (i.e., incur the cost) and it must be supplied as part of the professional behavioral health services furnished incident to a treatment plan. If the patient independently purchases the device, or the provider did not furnish it, then code G0552 is not payable.
• The device must be used “in conjunction with ongoing behavioral health treatment under a behavioral health treatment plan of care.” That means it is an adjunct to—not a standalone self-care tool.

Provider eligibility / billing criteria

• The practitioner furnishing or billing the service must be authorized to diagnose, evaluate and treat a mental health disorder, and must have authority within their state scope of practice to order/prescribe the DMHT device.
• For G0553/G0554 (the monthly management codes): billing is allowed only when there is ongoing use of the DMHT device; if device use stops, these codes are not billable.
• The monthly management codes require direct review of data from the device (patient observations, inputs) plus at least one interactive communication with the patient or caregiver during the calendar month. The first 20 minutes is G0553; each additional 20 minutes is G0554.

Implementation Insights: How Practices Should Prepare

These changes mean updating workflows, documentation and billing systems. Here are practical tips for smooth implementation:

Identify eligible devices

• Confirm which digital mental health treatment devices your practice uses (or plans to use) have the required FDA clearance or de novo authorization and are classified under 21 CFR 882.5801. Without this, G0552 is not payable.
• Maintain documentation of device clearance and classification, including purchase/furnishing records showing the provider incurred the cost.

Update treatment-plan documentation

• Ensure the behavioral health treatment plan clearly includes the use of the DMHT device as part of care.
• Document patient/caregiver education and onboarding (for G0552).
• For monthly management (G0553/G0554), document device-generated data review and at least one interactive communication each month.

Billing system set-up

• Ensure your practice management/billing software adds codes G0552-G0554 and maps them correctly to Medicare payment rules.
• Set “incident-to” billing rules appropriately (the device supply is furnished incident to the professional service).
• Flag when device use discontinues so G0553/G0554 are only billed if usage continues.

Monitor payer responses

• While Medicare sets a precedent, commercial payers may lag or have different policies — monitor if payers adopt similar codes or create carve-outs.
• Track payment amounts, claims edits, and any denial patterns related to device eligibility or usage documentation.

Educate your providers and coding teams

• Inform mental health providers, telehealth coordinators and billing/coding staff about the new codes, their criteria and documentation expectations.
• Update internal policy manuals, training and checklists.
• Because this is a new reimbursement pathway, early adoption may require more oversight to avoid claim denials.

Looking Ahead: Potential Challenges & Future Developments

While the 2025 PFS rule is a milestone, there are some caveats and opportunities to watch:

• Scope of devices may be narrow: Because CMS limited the device eligibility to those cleared under section 510(k) or de novo and classified under 21 CFR 882.5801, many digital mental health tools may fall outside this classification — thus limiting which devices qualify.
• Payment amounts may be modest: As your old draft noted, the estimated reimbursement rates for G0553/G0554 are relatively modest (based on work RVUs of ~0.62/0.61 and a conversion factor ~ $32.35). That means practices need efficient workflows to make deployment of these services cost-effective.
• Adoption and evidence generation: CMS stated it will “monitor how digital mental health treatment devices are used as part of overall behavioral health care.” This suggests that further refinements, expansions or modifications may come in future PFS rules depending on uptake and outcomes.
• Commercial payer variability: While Medicare’s move is influential, commercial payers may adopt different rules or timelines — practices must still review each payer’s policy.
• Integration into behavioral health/care models: For these codes to succeed, digital tools must be integrated into the behavioral health workflow effectively — simply deploying an app may not suffice. Providers must engage patients, review data, and use device insights within the treatment plan.

Final Thoughts

The inclusion of digital mental health treatment device codes in the 2025 Medicare Physician Fee Schedule marks a significant shift — one that opens new doors for reimbursement, elevates the role of digital therapeutics in behavioral health, and offers practices a chance to deliver enhanced, tech-enabled care. For RCM firms and practices, viewing this not just as a new code set but as a component of a broader digital health strategy will be important.

By aligning billing, documentation workflows and provider education now, practices can position themselves ahead of the curve — capturing incremental revenue, improving patient access and supporting behavioral health integration into broader care pathways.

Empowering Behavioral Health Practices Through Smarter Billing

As Medicare continues to expand reimbursement opportunities for digital and behavioral health care, practices must evolve their billing processes to keep pace with new regulations, technology, and documentation requirements. Implementing the new DMHT codes is not just about billing—it’s about ensuring that your practice is equipped to deliver modern, patient-centered care while maintaining financial stability.

At Bristol Healthcare Services, we specialize in behavioral health billing, coding, and revenue cycle management designed to maximize reimbursements and eliminate administrative burdens. Our certified billing experts stay ahead of every regulatory and payer change—like the 2025 DMHT codes—so your team can focus on what truly matters: helping patients achieve better mental health outcomes.

From accurate claims submission and denial prevention to technology-driven reporting and analytics, we streamline every aspect of your revenue cycle. Whether you’re implementing digital mental health treatment, expanding telehealth, or managing complex multi-provider billing, our team ensures compliance, precision, and profitability every step of the way.

Partner with Bristol Healthcare Services to modernize your behavioral health billing and unlock the full potential of digital care.

Let’s help your practice move forward—with confidence and clarity!