The unlocked potential: CMS brings digital mental health into the heart of reimbursable healthcare.

In case you missed the news, Medicare is now covering FDA-cleared Digital Mental Health Therapeutics – DMHT. Starting January 2025, licensed mental health professionals will be able to bill Medicare for digital mental health tools, enhancing their legitimacy and broadening access for patients. 

This policy introduces three new HCPCS billing codes, making it easier and reimbursable for practitioners to integrate DMHT FDA-cleared tools (via the 510(k) or de novo) into behavioral health treatment plans. In addition, CMS will actively monitor outcomes and usage, collecting critical data to adjust  and improve future policies. 

For the tech sector, this policy creates a unique opportunity to align product innovation with real market needs and payer expectations. Startups that can prove clinical value, protect their innovations with strong IP, and clearly differentiate their products will gain a competitive edge, making them not only more attractive to investors but also set for sustainable growth. 

From an investor’s perspective, Medicare’s support is a game-changer. By bringing digital mental health tools into reimbursable healthcare, it signals that broader adoption is on the horizon, unlocking a significant market opportunity. That said, successfully investing in this space will require a clear and creative GTM plan and strategic risk management.