10 Simple Rules for PT Billing

As a practicing physical therapist, you have a lot going on—everything from treating patients and tracking outcomes data to running a profitable business and collecting payment for your services. So, it’s no wonder you have less time than you’d like to keep up on all the ins and outs of PT billing. Not to worry; I’ve got you covered. Here are 10 must-know PT billing rules in an easy-to-read digest format. (If you want to dive deeper into a particular subject area, click the links in the corresponding paragraph. They’ll take you to detailed articles that’ll teach you everything you need to know about that specific PT billing topic.)

One more thing before we get going: This digest covers Medicare guidelines specifically. While many third-party payers employ similar billing policies, I’d strongly recommend verifying the rules for each insurance your clinic accepts.

With that out of the way, let’s dive in:

1. Billable Time

To put it simply, billable time is time spent treating a patient. However, there are some nuances to keep in mind. For instance, you can’t bill for:

  • unskilled prep time,
  • multiple timed units due to multiple therapists,
  • rest periods or other break times,
  • supervision, or
  • documentation.

Additionally, when calculating your billable time, you shouldn’t ever round up. However, you can bill for evaluations and reevaluations—in some cases. Most payers, including Medicare, allow therapists to bill for the initial evaluations necessary to establish plans of care. And as for re-evaluations, therapists can bill for the time they spend conducting these mid-episode assessments—if there has been a significant change in the patient’s progress (see number 7 below for more on that).

For a detailed discussion of billable time, check out this post.

2. One-on-One Services vs. Group Services

The manner in which you bill for the time you spend treating patients may differ depending on whether you provide one-on-one or group services. A one-on-one service is an individual therapy service—one that involves direct, one-on-one contact with a patient. While a group service still requires constant attendance, it does not involve one-on-one contact with each patient. Rather, according to CMS, it “consists of simultaneous treatment to two or more patients who may or may not be doing the same activities.”

To learn more about the differences between billing for one-on-one and group services, read this article.

3. Co-treatment

Now, what if multiple therapists provide treatment to one patient at the same time? Therapists who bill under Medicare Part B cannot bill separately for the same or different service(s) provided to the same patient at the same time. However, therapists who bill under Medicare Part A may bill separate, full treatment sessions with a patient—as long as each therapist is of a different discipline and provides different treatments to the same patient at the same time.

For clarity on billing for co-treatment—and a few examples—check out this resource.

4. Credentialing

Being credentialed by an insurance company allows you to become an in-network provider, which may help you reach—and serve—a larger pool of potential patients. If you haven’t already obtained credentialing with a major payer in your area, you may want to consider changing that. Some payers—like Medicare—do not allow uncredentialed practitioners to provide, or collect payment for, any covered services.

If you have questions about the credentialing process, seek the advice of a consultant or an established PT in your neighborhood. He or she may be able to help you complete the paperwork as well as provide tips and tricks for ensuring its acceptance.

5. Copays

If your patient’s insurance requires him or her to pay a copay, you can collect that payment when you provide your services. In most cases, it is not a good idea to waive copayments or deductibles. However, there are other ways you can provide financial assistance to patients who need it. To learn more about what your payers consider acceptable when it comes to helping patients cover the cost of your services, thoroughly read your insurance contracts. If you still come up empty-handed, contact your payers directly.

6. The 8-Minute Rule

The 8-Minute Rule (a.k.a. “the rule of eights”) determines how many service units therapists can bill to Medicare for a particular date of service. According to the rule, you must provide direct treatment for at least eight minutes in order to receive reimbursement from Medicare for a time-based code. But, while it sounds simple, there are some tricky 8-Minute Rule scenarios that could trip you up.

To learn how to handle those situations, check out this resource.

7. Reevaluations

You should only bill for a reevaluation (97002) if one of the following situations applies:

  • You note a significant improvement, decline, or change in the patient’s condition or functional status that was not anticipated in the plan of care (POC).
  • You uncover new clinical findings during the course of treatment that are somewhat related to the original treating condition (i.e., a new diagnosis to add to the POC).
  • The patient fails to respond to the treatment outlined in the current POC, so a change to the POC is necessary.
  • You’re treating a patient with a chronic condition, and you don’t see the patient very often.
  • Your state practice act requires re-evaluations at specific time intervals.

Learn more about billing for reevaluations here.

8. The Therapy Cap

Introduced as part of the Balanced Budget Act (BBA) of 1997, the therapy cap was intended as a temporary solution for controlling Medicare costs. However, despite longstanding efforts to repeal the cap, Congress has continued to renew it each year. For 2016, the cap amount is $1,960 for physical and speech therapy combined and $1,960 for occupational therapy. The cap does not reset for each diagnosis. So, even if a patient seeks therapy related to multiple diagnoses over the course of the benefit period, all of those services would count toward that patient’s limit. Still, to ensure the cap does not prevent Medicare patients from obtaining medically necessary care, Congress has also passed legislation every year that allows exceptions for exceeding the cap. In 2016, there is a two-tiered exceptions process.

9. ABNs

In order to provide Medicare patients with services that you believe are either not covered by Medicare or not medically necessary (e.g., the services extend beyond the therapy cap), you must have your patient sign an Advance Beneficiary Notice of Noncoverage (ABN), thereby indicating that he or she will accept financial responsibility if—but really more like when—Medicare denies the claim.

To learn more about how (and when) to correctly administer an ABN, read this article.

10. Modifiers

Modifier 59
If you provide two wholly separate and distinct services during the same treatment period—specifically, services that are typically bundled together—you may need to apply modifier 59 to signal that you should receive payment for both services. Download your printable modifier 59 decision chart here.

KX Modifier
The KX modifier is part of the automatic therapy cap exceptions process. If you believe it is medically necessary for a patient who has already reached the therapy cap to continue treatment—thus qualifying the patient for an exception—you would attach the KX modifier and clearly document your reasons for continuing therapy.

GA Modifier
If you issue an Advance Beneficiary Notice of Noncoverage (ABN) because you believe that certain services are not medically reasonable and necessary, then you should add the GA modifier to the claim to signify that you have an ABN on file. (Please note that if you use the GA modifier, you should not use the KX modifier.)

Speaking of ABN-related modifiers, there are three more you should know about:

  1. GX: Indicates that you issued a voluntary ABN for a non-covered service.
  2. GY: Indicates that you performed a non-covered service, but an ABN is not on file. (In this case, the patient is inherently liable for charges because the service is not covered.)
  3. GZ: Indicates that you expect the service to be denied because it isn’t medically necessary, but you do not have an ABN on file. (In this case, the patient is not responsible for payment.)

Think you’ve got modifiers down? Take this quiz to test your smarts.


There you have it: 10 must-know rules of PT billing in digest form. How do you stay on top of PT billing rules? What resources are your favorites? Tell us in the comment section below.

About the Author
Heidi Jannenga is co-founder and president of WebPT, the leading electronic medical record solution for physical therapists and a three-time Inc. 5000 honoree. She has more than 15 years of experience as a physical therapist and clinic director, and she’s an active member of the sports and private practice sections of the APTA as well as the PT-PAC Board of Trustees.