When Downcoding Changes Reimbursement, How Do We Protect Continuity of Care?

An According To Sykes reflection on downcoding, clinical sustainability, and supporting one another

A client’s care depends on the relationship built in the room, but also on the conditions that allow that relationship to continue.

For clinicians, those conditions include time, administrative support, and reimbursement that reflects the services provided. When payment becomes unpredictable, it raises difficult questions about how to sustain a practice while remaining accessible to the people who rely on it.

Recent reporting from the Chicago Sun-Times brings those questions close to home.

What is changing?

In an August 26 article, reporter Elvia Malagón describes concerns from Illinois clinicians about Blue Cross Blue Shield of Illinois’s new claims-review approach. Providers reported reduced payments and a substantial burden of disputing individual claims, with potential consequences for staffing and patient access. BCBSIL defended the changes as a way to support accurate payment. Read the Chicago Sun-Times article.

The term downcoding describes an insurer changing a submitted service code to a lower-paying level.

BCBSIL’s own notice states that, for dates of service beginning July 1, 2026, its enhanced review applies to professional claims for office, inpatient, and outpatient evaluation and management services under commercial plans. When the insurer determines that the billed level is unsupported, it pays a lower level. Providers who disagree may submit supporting medical records. BCBSIL provider notice.

For psychotherapy clinicians, the distinction matters: this notice concerns evaluation and management services. It should not be read as confirmation that every psychotherapy code or every behavioral health claim is subject to the same change. Check the specific service, plan, and payment explanation before drawing conclusions about your practice.

Why downcoding belongs in a conversation about care

At ATS, we view continuity of care as something worth protecting intentionally. Clients invest time and trust in therapeutic relationships. Clinicians invest attention, skill, and sustained presence.

Our concern is what happens when the resources needed to maintain those relationships become less reliable. A reimbursement dispute can create difficult choices about appointment capacity, administrative workload, and participation in insurance networks.

For practices rooted in relational and culturally responsive care, financial sustainability deserves an open conversation. Clinicians should be able to discuss the conditions of their work without feeling that doing so diminishes their commitment to clients.

A constructive place to begin

For clinicians and practice leaders reviewing payment changes, we suggest a focused, collaborative approach:

• Make the pattern visible. Keep a secure record of submitted and paid codes, payment differences, adjustment explanations, and dispute outcomes. Distinguish downcoding from other reasons a payment may be lower.

• Review the applicable policy. Confirm which plans, services, and dates are affected. Use the current payer instructions and contractual deadlines for any dispute.

• Connect clinical and administrative expertise. Set aside time for clinicians and billing staff to review representative claims together. Identify what documentation supports the service actually delivered.

• Keep care and documentation accurate. Clinical decisions should reflect client needs, and records should accurately support the services provided. An unexpected payment is a reason to investigate.

• Share useful knowledge responsibly. Professional associations and trusted colleagues can help identify recurring concerns and coordinate advocacy. Keep client information out of public discussions.

These steps cannot remove every administrative barrier. They can give a team a clearer picture of what is happening and a more organized basis for responding.

Illinois has acted, but the protections have limits

Illinois’s Transparency in Downcoding Act establishes protections beginning January 1, 2028, for qualifying coverage issued, amended, delivered, or renewed on or after that date.

The law requires human involvement in downcoding determinations, prohibits reductions based solely on diagnosis codes, and establishes notification and dispute requirements. It does not prohibit every use of automated claim screening.

Its scope also matters: the law’s definition of covered health care professionals includes physicians, physician assistants, and advanced practice registered nurses—not all behavioral health licenses. It excludes self-insured employer plans governed by ERISA, among other coverage. Clinicians should not assume these future protections apply to every practice or claim. Read Public Act 104-0568.

This is meaningful progress, with room for continued advocacy around the professionals and communities left outside its reach.