Is the American Medical Association Ready for Psychedelics?

Though psychedelics are gaining mainstream support from media and patients alike, the medical institution is not as quick to voice its unwavering support. Bureaucracy moves much slower than the rest of the world, but even that has begun to move in a positive direction for psychedelic medicine. On May 2, it was announced that the American Medical Association is crafting a set of CPT codes for psychedelic-assisted therapy, which will help increase access once MDMA and psilocybin become FDA-approved.

The application was a joint effort by Compass Pathways and MAPS, and it will support both companies’ ability to commercialize their drugs (MDMA and synthetic psilocybin) and treatment protocols. This announcement is good news for all companies that hope to sell any psychedelic products or treatments in the United States. So, let’s take a look at what exactly this means for the industry.

The American Medical Association (AMA) is essentially a lobbyist group that has become the voice of medical ethics, science, and terminology. In fact, the AMA was the 7th largest lobbyist in the United States in 2022, with over $21 million spent. The association is made up of medical professionals and medical students and has significant influence in the medical space.

The association has a significant voice in the medical space. The Journal of the American Medical Association offers medical providers information on best practices, ethics, and new medical discoveries. The journal gives the AMA a significant hand in what is accepted and practiced within the medical community. The association also has a say over the terminology used in medical practices. 

The AMA creates Current Procedural Terminology (CPT) code, which becomes the standard for the medical environment and administration purposes in the United States. CPT ‘offers doctors and health care professionals a uniform language for coding medical services and procedures to streamline reporting, increase accuracy and efficiency.’ It is used, for example, in insurance claims so that treatment is covered by insurance. It also helps providers and institutions, such as the AMA, gather data on certain medicines and practices. 

Now, since psychedelic medicine is a completely new concept to the medical institution— at least in the modern day— there is no official terminology for this type of treatment, which makes it impossible for psychedelics to move through the slightly-oiled cog. So, Compass Pathways and MAPS submitted a joint application to ensure that once FDA approval of psychedelic-assisted therapy comes through, the proper measures are in place for the current medical establishment to integrate psychedelic therapy into its system.

At this time, the AMA has announced that they are working on a set of CPT III codes for psychedelic therapy— meaning that the codes are temporary and are meant to be used to collect data. The terminology may be updated in the future once the initial codes are tested in practice. These types of temporary codes are made for emerging technologies, treatments, and procedures. The full details of the CPT codes for psychedelic therapy will be released in July 2023, and they will go into effect on January 1, 2024— just in time for the FDA approval of MDMA for the treatment of PTSD.

Though the exact date of the FDA approval for the MAPS MDMA program is not yet known, it will likely occur in the first quarter of 2024. While the FDA approval of psychedelic-assisted therapy is significant, it does not mean that patients will immediately be able to access treatment. There are several issues that need to be overcome before the development of widespread psychedelic treatment, and these codes begin the prosses of addressing one of the major ones.  

One of the major issues that the psychedelic industry faces is the cost of treatment. There is currently no insurance coverage for any kind of psychedelic treatment, apart from Spravato, which makes it impossible for many people to access psychedelic therapy. These codes will make it possible for doctors to charge insurance companies for psychedelic treatment using agreed-upon terminology, and once services are covered by insurance, many more people will be able to access psychedelic medicines.

The timing of this announcement is quite impeccable and, no doubt, carefully planned by MAPS and Compass Pathways. MAPS will likely be able to begin the commercialization of MDMA within a few weeks to a few months of the codes being finalized on January 1, 2024, and Compass’s psilocybin drug will follow suit one to two years after. MAPS has done an incredible job at bringing psychedelic treatment to market, and this is another step towards doing just that. 

Though there are other issues that need to be addressed before the commercialization of psychedelic medicines goes into full swing— such as the lack of therapists and treatment spaces— this is an important building block for the industry. The cost of treatment is significantly high, and getting insurance companies to reimburse psychedelic services is crucial for both patients and companies that hope to capitalize on psychedelic drugs. 

This announcement also serves as proof that the medical institution will not be standing against the use of psychedelics for medical purposes— as it has in the past. While media surrounding psychedelics has been incredibly positive over the past few years, medical and government institutions are not as easily swayed as the public. Bureaucracy is the biggest roadblock that psychedelics face, so this is a very positive sign that they do, in fact, have a place in the future of mainstream medicine. 

The government and other influential institutions in the United States, as well as several other countries, have begun to voice their support for psychedelic treatment over this past year, and now they’re even making moves toward legal access. Steps like the CPT codes are a good sign that psychedelic companies will be able to integrate their new drugs and protocols into the already existing infrastructure that makes up the US medical system.