Part B Reimbursement Changes: What You Need to Know

By Kindred Hospital Rehabilitation Services

In late 2019, the Centers for Medicare and Medicaid Services finalized the Physician Fee Schedule for this calendar year, which includes several updates and changes to the provision, payment and paperwork related to Medicare Part B Physical Therapy services. These changes included new rules that have already gone into effect earlier this year, and for new initiatives coming in 2021 and 2022.

Part B Reimbursement Changes

Key provisions related to Part B Physical Therapy included:

  • Physical Therapy Assistant Modifiers: The Bipartisan Budget Act of 2018 included a last-minute provision to reduce the reimbursement of physical therapy assistants to 85% of the reimbursement level for therapists beginning in 2022. This provision was, in part, used to pay for the repeal of the long-standing Part B Therapy Cap. In order to prepare for the 2022 implementation, beginning in 2020, CMS will add new discipline-specific therapy modifiers for physical therapy and occupational therapy assistants – CQ for PTA and CO for OTA. Additionally, CMS did indicate that “we would expect the documentation in the medical record to be sufficient to know whether a specific service was furnished independently by a therapist or a therapist assistant, or was furnished ‘in part’ by a therapist assistant, in sufficient detail to permit the determination of whether the 10% standard was exceeded.”

  • New Current Procedural Terminology (CPT) Codes: 2020 includes four new CPT Codes, including two for “dry needling” and two for “cognitive function” intervention. While the new needle insertion CPT codes are active in 2020, CMS has indicated that there will be no payments for these codes. The two new direct patient contact cognitive intervention CPT codes – 97129 and 97130 – are timed and cover therapeutic interventions that focus on cognitive function (e.g., attention, memory, reasoning, executive functioning, problem solving and/or pragmatic functioning) and compensatory strategies to manage the performance of an activity.

  • Changes to 2021 Reimbursement Rates: In the 2020 Physician Fee Schedule (PFS) final payment rule, CMS proposed an increase to primary care physician (PCPs) Evaluation and Management (E/M) codes. The proposal came about from the desire to attract new PCPs to meet the needs of the rapidly growing Medicare population. However, because the PFS is a budget-neutral payment system, the increase for PCPs had to be offset by cuts to other professionals. As a result, the final rule proposed an 8% cut for rehabilitation therapists – physical, occupational and speech-language pathologists – as well as a 7% cut to emergency medicine, a 7% cut to anesthesiology, a 6% reduction for audiology, and 9% and 6% drops in payment for chiropractors and clinical social workers, respectively. However, these rate changes have not yet been finalized, and significant advocacy efforts are underway to change the system prior to the 2021 PFS proposed rule being issued in August and finalized in November. 

Hospitals and health systems require strong partners with a long history of outpatient physical therapy expertise to navigate the Part B Therapy system changes with uninterrupted operational success. Additionally, the best operating environment results from having partners with a proven track record of advocating on behalf of the Part B Therapy industry with policy makers and regulators.

At Kindred Rehabilitation Services (KRS), we are the nation’s leading rehab experts. Representatives of KRS have a strong history of navigating the complicated changes and updates that specifically target Part B services. Our clinical and policy experts are regularly named to CMS’ Technical Expert Panels (TEPs) to help shape upcoming policies, and are regularly advocating on behalf of the industry and our nation’s leading trade associations before Congress.

By Kindred Hospital Rehabilitation Services