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Intensive Outpatient Program – IOP Billing Guidelines Explained

July 13, 2016


Intensive outpatient programs, or IOPs, are growing in popularity as a treatment alternative to hospitalization or other inpatient services for people who do not need detoxification. IOPs are typically offered for patients with substance abuse disorders who have either completed a detoxification period or who don’t require one, or to individuals with certain types of eating disorders or depression, provided they are not in danger of self-harm. The advantages for the patient include the ability to maintain a presence at school or work, lower costs, and the ability to live at home. 

On the provider side, an IOP is a series of multiples: Multiple treatment services (family, individual, and group therapy) and treatment modalities (cognitive behavioral therapy and rational emotive behavioral therapy, for example), given on multiple days per week (usually a minimum of three), and provided by a multidisciplinary team of mental health specialists, which may include psychiatrists, psychologists, clinical social workers, and counselors. Most programs are required to provide at least three hours of psychiatric and therapeutic services per day, with at least two group therapy sessions and individual services to address mental health needs. 

IOP Billing Guidelines: The Basics

  • Prior authorization. Many insurance carriers require prior authorization or approval prior to reimbursement for IOP services. It’s important to keep an eye on expiration dates and submit new authorization requests if needed before the original expires to avoid claims rejection. 
  • Duplication of services. In most cases, it is considered duplication of services to bill two IOP service units for the same patient on the same day. For example, if a patient is treated in a substance abuse IOP as well as a mental health IOP, you should report that information separately to the insurance carrier, but do not expect to double bill IOP sessions. In this case, most carriers require you to integrate care in an individualized plan and bill for a single IOP service. 
  • Physician services. If the IOP care is provided in an outpatient mental health center, physician service fees are included in the rate for the program. If the IOP is offered as a hospital-based program, in most cases, physician services are billed separately. 
  • Duration of services. While carrier guidelines and state licensure laws vary, in most cases, an IOP is a short-term, acute intervention and should last no longer than 90 to 180 days. 

IOP Billing: HCPCS and Revenue Codes

In general, you will use one of two main HCPCS codes for IOP services, depending on whether the diagnostic code is for alcohol and substance abuse treatment or for mental health. 

  • Alcohol and other substance abuse IOPs. The HCPCS 2016 code is H0015, which is described as “Alcohol and/or drug services; intensive outpatient (treatment program that operates at least 3 hours/day and at least 3 days/week and is based on an individualized treatment plan), including assessment, counseling; crisis intervention, and activity therapies or education.” Note that one unit of service equals three hours of therapy in a single day, and appropriate clinical documentation is usually required. In most cases, you’ll use the four-digit revenue code 0906 for intensive outpatient services, chemical dependency. 
  • Mental health IOPs. The HCPCS 2016 code for mental health IOP sessions is S9480, which is described as “Intensive outpatient psychiatric services, per diem.” For this service, a revenue code of 0905 for intensive outpatient psychiatric services is appropriate. 

In most cases, programs must be licensed and approved by the state in which they operate in order to qualify for reimbursement under private insurance guidelines. Also note that Medicare does not recognize these HCPCS codes for reimbursement purposes. 

If you have questions about your IOP billing or other medical billing issues, contact our team of professional revenue cycle consultants to find out how you can maximize your reimbursement for these services.


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