Senators Shelley Moore Capito, R-W.Va., and Jeanne Shaheen, D-N.H., reintroduced the Access to Prescription Digital Therapeutics (PDT) Act on Thursday to expand access to software-based treatments.
Advocates will bring new economic data from Germany to make the case to Congress, Centers for Medicare & Medicaid Services (CMS) Director Mehmet Oz, M.D., and Department of Health and Human Services Secretary Robert F. Kennedy Jr. to create pathways for coverage of the technologies.
By leaning into the Make America Healthy Again (MAHA) crowd in Washington, advocates at the American Telemedicine Association's (ATA's) lobbying arm think they have an unprecedented chance to pass the bill.
The Access to PDT Act would create a reimbursement pathway for software that treats medical conditions, like Cognoa's early autism diagnosis product and Freespira's panic attack disorder treatment. The category has broadly struggled with uptake because the Medicare program does not have the authority to cover the technologies under its existing benefit categories.
The bill would create a new Medicare benefit category for Food and Drug Administration (FDA)-cleared prescription digital therapeutics to be prescribed to seniors in the program. Medicare is considered a bellwether for commercial payers, which may start covering the products if the CMS acts first.
It would require the CMS to develop payment methodologies for prescription digital therapeutics and create product-specific CPT codes to adequately reimburse for the products.
In the last Congress, the potential cost of the bill stymied its progress. Legislators worried that expanding access to the treatments could result in tens of billions of dollars in spending for the Medicare program. The Congressional Budget Office (CBO) declined to score the bill because it didn’t understand how to estimate the cost impact of the novel treatments.
New data out of Germany may be able to help provide the CBO with an estimate. Germany found that in four years of paying for PDTs, it spent 234 million euros ($263 million). Germany had 861,000 activations of PDT products between the fourth quarter of 2020 and the fourth quarter of 2024, and it now covers more than 50 products. Its population is roughly a quarter of the size of the U.S.
While the two countries' approach to healthcare varies widely, advocates hope the data could give Congress and its budget office a glimpse into possible spending levels if there were Medicare coverage of the products.
The technologies gained traction in November 2024 when the CMS included digital mental health treatment (DMHT) codes for the first time in its annual physician pay rule.
The rule said FDA regulation considers insomnia, substance use disorder, depression and anxiety in this category, but the CMS said its payment for DMHTs are not limited to these diagnoses.
“We are at a starting point of Medicare payment for DMHT devices as supplies furnished incident to professional behavioral health services used in conjunction with ongoing behavioral health care treatment under a behavioral health treatment plan of care and anticipate that this will be an iterative process,” the rule said.
The Fiscal Year 2025 Physician Fee Schedule noted that other digital therapeutics require the creation of a new Medicare benefit category and are not covered under the proposal. It also said that digital mental and behavioral health apps and interventions cannot use the codes.
Andy Molnar, senior vice president and head of digital health at the ATA and ATA Action, said the DMHT codes only cover half of the existing digital therapeutics for mental health. For example, Regulora treats irritable bowel syndrome related to anxiety. Though the product treats anxiety, it does not fit into the codes’ definition.
Molnar was the former CEO of the Digital Therapeutics Alliance until it was acquired by ATA Action on March 31.
ATA Action is bringing the case to Oz to argue for expanded coverage of products. It hopes it will find a sympathetic ear from the director, who has previously invested in digital health.
The lobbying group also wants to speak to MAHA supporters in government who have displayed distrust in the pharmaceutical industry while they remain concerned about the health of Americans.