Will 2018 be the Year We Kill the Therapy Cap for Good in the US?

In 1997—the same year Titanic took over the box office and the Spice Girls were topping the music charts—the Clinton administration signed into law the Balanced Budget Act, which included a pesky provision placing an arbitrary annual limit on the dollar amount Medicare will reimburse for each beneficiary’s physical therapy, occupational therapy, and speech-language pathology services. And it’s been a thorn in our collective side ever since.

Sure, as soon as the so-called therapy cap was adopted, Congress enacted an exceptions process that allowed therapists to treat above the limit as long as they were providing services that Medicare deemed “medically necessary.” And yes, Congress has renewed that exceptions process every year since. Still, many providers are wary of wielding the KX modifier in order to receive payment for services provided to patients who have already reached the cap, even in situations where patients would benefit from continued care. Why? Because:

  1. Medicare has a murky definition of medical necessity, especially as it applies to maintenance care coverage; and
  2. Frequently exceeding the cap could throw up a red flag to Medicare and lead to an audit.

While having to pause services until the cap resets can be frustrating and revenue-draining for providers, the real problem is how detrimental it can be to a patient’s functional progress and recovery. In fact, it could actually lead some patients to turn to more invasive, not to mention expensive, treatment options (cough—opioids and surgery—cough). And that could seriously jack up spending in the long run, all but defeating the purpose of the cap in the first place. The cap also makes it very difficult for patients who could benefit from both speech-language pathology and physical therapy, because both services are covered under one cap. Thus, if a patient experiences a major cardiac or neural condition (a stroke, for example), then he or she may feel pressured to choose between therapy to help regain communication skills or therapy to improve mobility. And that’s a choice no one should ever have to make.

As APTA Chief Executive Officer Justin Moore told Congress earlier this year, the problem the cap was designed to solve in 1997 still exists today—and the yearly allowable amount is so low that strictly adhering to it would prevent patients from obtaining the medically necessary services they need. Furthermore, the exceptions process is confusing in a way that only Medicare processes can be—and it can be disruptive enough to cause gaps in patient treatment plans and provider revenue streams. As Moore said, “This pattern of yearly extensions without a permanent solution creates uncertainty for beneficiaries and providers, threatens access to care, and is not in the best interest of patients, providers, or the Medicare program.”

Now, more than two decades later, we are closer than ever to ridding the rehab therapy world of this barrier to providing our patients with the care they deserve. In fact, there are currently two proposals on the table that, if adopted, would help lessen—or potentially even eliminate—the burden created by the cap:

  • The first would essentially create a permanent exceptions process requiring all claims exceeding a primary threshold (which, in 2018, is $2,010) to include a modifier denoting medical necessity (as long as the billed services are medically necessary). Furthermore, any claims exceeding a secondary threshold of $3,000 would be eligible for targeted medical review. From what we’ve heard from our sources at the APTA, this proposal will be included in an omnibus Medicare bill that Congress will vote on in December.
  • The second proposal is for a bill that would repeal the cap entirely. This bill—known as the Medicare Access to Rehabilitation Services Act—would replace the cap and cap exceptions process with an all-encompassing targeted review process (similar to the one currently applied to claims exceeding $3,700). This bill—which has strong bipartisan support and backing by the APTA, ASHA, and AOTA—has been sitting before Congress since February. Only time will tell if it gets voted into law, but many rehab therapy advocates are optimistic about its passage.

In the meantime, there’s still work for us to do—work in the form of advocacy. Here are just a few ways that you can get involved:

  • Join the APTA and stay up to date on advocacy efforts.
  • Be an active member of PTeam, APTA’s advocacy team.
  • Contact your representatives about repealing the Medicare therapy cap.
  • Visit this APTA action page to stay current on the advocacy efforts impacting our industry.

Speaking of staying current, be sure to join me on December 13 for a free webinar detailing the regulatory changes—including those that are part of this year’s Final Rule—that will impact rehab therapists most in 2018. (Even if you aren’t available that day, be sure to register anyway so you receive the recording and handouts). After all, you can’t possibly prepare for the changes on the horizon until you know what those changes are. I hope to see you online!

About the AuthorHeidi Jannenga is co-founder and president of WebPT, the leading physical therapy software platform for enhancing patient care and fueling business growth. 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.

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