Taking the Cap off of Outpatient Therapy Services

Posted in Administrative, Blog at Nov 14, 2017





Matthew Mesibov, PT, GCS
Clinical Physical Therapy Specialist


Back in 1997 congress created legislation known as The Balanced Budget Act and placed an annual and “arbitrary” financial cap on rehabilitation services reimbursement under Medicare part B. I use the word arbitrary because the decision of the total dollar amount was not based on needs related to a specific diagnosis and patient findings but due to the amount of dollars available to spend divided by the number of beneficiaries who were eligible for physical therapy, occupational therapy and speech language pathology services.  Due to federal regulations, the dollar cap which in 2017 is a shared $1980 for physical therapy and speech language pathology and $1980 for occupational therapy.

The program then included a way to apply for services beyond the financial cap if extenuating circumstances existed and were approved by the Medicare contractor.  So, picture an older adult who may have had a stroke or another neurological disease such as Parkinson’s disease or multiple sclerosis in need of necessary therapy services.  If the therapy cap was met, then you would have to check if the diagnosis qualified as an “automatic” exception vs. a manual exception.  Eventually the program changed to an exceptions process where it is up to the clinician’s clinical judgment which they must support in their documentation as to whether services should continue.

Over the years, through advocacy efforts with legislators by patients, concerned citizens, therapists and other medical professionals, congress has recognized the cap’s potential harmful effect on Medicare beneficiaries and has continually extended an exceptions process that enables Medicare to pay its share for therapy services after the patient reaches the therapy cap limits.  We almost had an elimination of the therapy cap this past year which in the 11th hour was dropped as part of a larger legislative bill.

Move forward to Thursday, October 26, the U.S. House Energy and Commerce Committee, the House Ways and Means Committee, and the Senate Finance Committee announced a bipartisan, bicameral deal on a permanent repeal of the annual outpatient Medicare therapy cap.

Here are some major points to the repeal plan:

  • The Medicare Part B therapy caps would be repealed beginning January 1, 2018.
  • There will be a targeted medical review process of therapy documentation beginning January 1, 2018 with the following details:
    • The dollar threshold for possible medical review targeting would be set at $3,000;
    • Therapy providers would be required to identify services exceeding the $3000 by submitting a billing code identifying this (known as the KX modifier)

Typically, when congress is going to repeal something such as the therapy cap, they will look to offset this cost by saving money elsewhere.  The current legislative proposal does not contain any offsets to pay for the provisions. As the current therapy cap exceptions is due to expire at the end of 2017, congress must act before the end of the year to either repeal the therapy caps or to grant another temporary extension for the exceptions process to protect beneficiary access to care.

We will have an answer as to whether the therapy cap comes off within the next month or so and I will be able to report on the results in our next quarterly blog.

Utilization Management – Friend or Foe to Accessing Necessary Treatment

Posted in Administrative, Blog at Aug 11, 2017


Matthew Mesibov, PT, GCS
Clinical Physical Therapy Specialist


Have you ever been told that you can no longer have therapy services because the insurance company is denying payment for services? If so, what may be at work is “Utilization Management”.

Utilization management (UM) was defined in 1989 by the Institute of Medicine (now the National Academy of Medicine) as “a set of techniques used by or on behalf of purchasers of health care benefits to manage health care costs by influencing patient-care decisions through case-by-case assessments of the appropriateness of care prior to its provision.”[1]

Though perhaps well intentioned, over the years as UM has increased, treating cost of care as an outcome metric may lead to overzealous prospective or retrospective denial of care or payment.

So, why has UM grown so much over these past few years? Upon passage of the Affordable Care Act (ACA) in 2010, health care purchasers (employers and individuals) were faced with a new set of coverage requirements and began seeking effective ways to limit the risk of potentially high financial costs. Other contributors to UM’s growth include escalating overall health care costs, increased demand for rehabilitation benefits, wide variance in care, fraud and abuse, and the medical loss ratio (the percent of the premium that an insurer spends on claims and expenses that improve health care quality, as opposed to administrative activities).

If all this seems dizzying (or more than you wanted to know), you as a consumer of rehabilitation services should know the following: typically, all health insurance payors are required to have an appeal process. This may include you as the consumer contacting them as well as your health care provider contacting the payor either by phone or by completing a form to appeal the denial decision.

The most important thing is to question your health care provider as to why services are ending if you feel it has not been explained well enough. Ask about available appeal processes if this information has not been offered. You must be a strong advocate for yourself!


[1] Institute of Medicine. Controlling Costs and Changing Patient Care? The Role of Utilization Management. National Academies Press, 1989.

This blog has been written in part based on information from the American Physical Therapy Association.


This months Solution’s Highlight is on Access Solutions!

Posted in Administrative, Blog at Jul 25, 2017

Centrex Rehab delivers a comprehensive approach to care and has developed a broad range of therapy solutions for skilled nursing communities, housing for older adults, assisted living, hospitals, clinics, schools and other venues. This month’s solutions highlight is on Access Solutions.  Access Solutions provides universal design consulting services to promote active, safe and independent living for people of all ages and abilities. Please see the below flyer for detailed information about what Access Solutions can offer to help with independent living for people of all ages.

Centrex Access Solutions