Two years ago, a digital health company pitching us would often spend half the meeting explaining why reimbursement was coming — citing CMS pilots, referencing state-level Medicaid experiments, pointing to commercial payor interest. It was a lot of "this is changing" and very little "this is done." That's shifted. Not everywhere, and not easily, but the structural pieces are falling into place in ways that change the investment calculus for digital therapeutics, remote monitoring, and behavioral health platforms specifically.
The most important thing we can say to founders in this moment: the reimbursement environment is materially better than it was in 2023, but it still rewards companies that built their business model around sustainable unit economics, not around the assumption that every payor would eventually pay full rack rate. The winners in this environment aren't the ones who waited for reimbursement — they're the ones who built while navigating limited reimbursement and are now positioned to scale when the gates open wider.
What actually changed at CMS
The Physician Fee Schedule updates that went into effect for 2025 and carried into 2026 expanded CPT coverage in meaningful ways. Remote Physiologic Monitoring (RPM) codes 99453, 99454, 99457, and 99458 are now more consistently covered under Medicare Advantage plans, not just traditional Medicare. The clinical conditions list for remote monitoring has also expanded — it no longer requires a primary diagnosis of a covered chronic condition for monitoring to be billable in many contexts.
Principal Care Management (PCM) codes, which were added in the 2020 fee schedule and underused for years, are now getting traction as billing staff becomes more familiar with them. PCM covers patients with a single complex chronic condition — different from Chronic Care Management's multi-condition requirement. Several of our portfolio companies are seeing commercial payors follow Medicare's lead on PCM billing within 12-18 months, which is faster adoption than we saw for CCM.
Digital Mental Health Treatment (DMHT) codes — 989A and 989B — represent a more recent and still-developing area. These codes, introduced provisionally in 2024, apply to prescription digital therapeutics for mental health conditions. Coverage is spotty. Some commercial payors have adopted them selectively; others are still in "wait and see" mode. But the framework exists now, which didn't three years ago.
The commercial payor picture
Commercial payors follow Medicare with a lag. We're seeing that lag compress. In 2022, we'd estimate commercial plans took 24-36 months to adopt coverage policies that followed major CMS actions. The current generation of value-based contracts is shortening that window because payors are under pressure to demonstrate outcomes on their enrolled populations, and digital health tools are increasingly in the mix for high-risk patient management programs.
The bigger change is where digital health companies are selling. The most successful commercial reimbursement deals we're seeing in our portfolio aren't straight fee-for-service arrangements — they're embedded in employer benefit programs, bundled into risk-bearing primary care arrangements, or structured as performance guarantees with shared savings components. These are more complex to close but much stickier once they're in place.
| Reimbursement Pathway | Maturity | Best For |
|---|---|---|
| Medicare RPM (99453–99458) | Established | Chronic disease monitoring platforms |
| Principal Care Management (PCM) | Growing | Single complex chronic condition focus |
| Behavioral Health Integration (BHI) | Established | Integrated care platforms with mental health |
| Digital Mental Health Treatment (DMHT) | Early/Patchy | Prescription digital therapeutics |
| Employer-sponsored value-based | Growing fast | Preventive health, metabolic, behavioral |
What this means for founders right now
If you're building in remote monitoring or chronic disease management, the question isn't whether reimbursement exists — it does. The question is whether your billing infrastructure is ready to capture it efficiently. We've seen multiple companies leave significant revenue on the table because their product teams were ahead of their revenue cycle operations. If your clinical workflow correctly documents the 20-plus minutes required for RPM billing but your software doesn't generate the clinical notes that support it, you're not going to get paid.
For digital therapeutics companies, the path is harder. Direct CMS reimbursement for PDTs is still limited, and the DMHT codes remain inconsistently adopted. The companies making the most progress here are building hospital system partnerships where the digital therapeutic is embedded in a care pathway billed under existing codes, not separately. It's less elegant than having your own CPT code, but it's a real revenue model today.
For behavioral health platforms, the Behavioral Health Integration codes are underutilized and represent a real opportunity. Primary care physicians can bill for coordinating mental health care without being psychiatrists — a lot of the care coordination that behavioral health digital platforms enable is already billable if the clinical workflow is designed around it. Most aren't.
Our view on where this goes
We're generally more optimistic about the reimbursement environment for digital health over the next three years than we were three years ago. That's a statement we couldn't have made with confidence in 2022. The infrastructure is building. The coverage policies are maturing. The billing expertise in health systems is catching up with the products that exist.
What hasn't changed: reimbursement follows evidence, not products. The companies that are getting covered are the ones that published real-world outcomes data, engaged with clinical societies, and showed up at ACMQ and ACP meetings to make their case. That work has to start now, even if your product is 18 months from market. The clinical evidence dossier you build today determines the coverage conversations you can have in 2028.
