Permanent Fix to the Medicare Therapy Cap Signed into Law

Late last week, Sharon Dunn, APTA President, and Justin Moore, APTA CEO, sent out an email announcing a $500 billion bipartisan budget deal was passed by Congress and signed by The President that would fund the federal government through March 23, 2018.  This new legislation will provide a permanent fix to the Medicare Part B therapy cap, thereby eliminating the need to fix this issue on an annual basis.  The cost of the permanent fix to the therapy cap was estimated at $6.47 billion.

The following fix is included in this new funding deal:

• Therapy claims for outpatient Medicare Part B that go above $2,010 (adjusted annually) will still require the use of the KX modifier for attestation that services are medically necessary;
• The threshold for targeted medical review will be lowered from the current $3,700 to $3,000 through 2027;
• While the threshold amount for medical review will be lowered, the Centers for Medicare and Medicaid Services (CMS) will not receive any increased funding to pursue expanded medical review, and the overall number of targeted medical reviews is not expected to increase; and,
• Claims that go above $3,000 will NOT automatically be subject to targeted medical review; only a percentage of providers who meet certain criteria will be targeted, such as those who have had a high claims denial percentage or have aberrant billing patterns compared with their peers.

Also included in this new legislation are a number of health policies that affect physical therapy patients, including:

• Extension of the Children’s Health Insurance Program (CHIP);
• Maternal, Infant, and early Childhood Home visiting Program;
• Community health centers for the National Health Services Corp and teaching centers that operate graduate medical education;
• The Medicare-dependent hospital program;
• The National Quality Forum;
• Expansion of the use of telehealth for home dialysis therapy; and,
• A number of changes to the Medicare Advantage program.

Attached to this legislation was a PTA and OTA payment differential.  This will pay for services rendered by PTA’s and OTA’s at 85% of the rate paid for PT and OT services.  This differential is set to take effect in January 1, 2022.   This was included in the legislation at the last minute by the House of Representatives on February 5th.  This had not been part of the year-long discussion that the APTA had on Capitol Hill.  On February 6, the APTA and AOTA presented alternative proposals to eliminate, reduce, or delay this payment differential.  All proposals were rejected.

According to President Dunn, the next step is for CMS to develop rules to further define and provide additional guidance prior to implementation.  The APTA will work with various groups, including the APTA Public Policy and Advocacy Committee and the PTA caucus, to address these various issues to ensure a beneficial outcome for PTA’s and the profession, as well as the patients/clients we serve.

Mark Bouziane, PT, MSPT, MEd
Federal Affairs Liaison