Medicare Therapy Cap

Under the Balanced Budget Act (BBA) of 1997 Congress placed an annual cap on rehabilitation services under Medicare. Since enacting the BBA, Congress has recognized the cap's potential harmful effect on Medicare beneficiaries and has acted several times to prevent implementation of a hard cap.

Representatives Charles Boustany (R-LA), Xavier Becerra (D-CA), Marsha Blackburn (R-TN), and Lois Capps (D-CA), and Senators Ben Cardin (D-MD) and Susan Collins (R-ME) introduced the Medicare Access to Rehabilitation Services Act (H.R. 775/S. 539) in the 114th Congress. H.R. 775 and S. 539 would permanently repeal the $1,940 therapy "cap" imposed on physical therapy, occupational therapy, and speech-language pathology services. An arbitrary cap on outpatient therapy services without regard to clinical appropriateness of care discriminates against the most vulnerable Medicare beneficiaries. APTA believes that a full repeal of the therapy cap is necessary to ensure patients have access to timely and appropriate care.

There is a two-tiered exceptions process, an automatic exceptions process and a manual medical review exceptions process. The automatic exceptions process applies when patients reach the $1,940 threshold and the manual medical review exceptions process is required at the $3,700 threshold.

On April 15, 2015, the US Senate passed the Medicare Access and CHIP Reauthorization Act (H.R. 2) legislation to repeal and reform the Sustainable Growth Rate (SGR) formula and includes an extension of the Medicare therapy cap exceptions process through December 31, 2017 and provisions to allow CMS to better target manual medical reviews. This was after an historic grassroots push and a vote to amend the bill to fully repeal the Medicare therapy cap which failed by 2 votes. This marked the furthest this issue has ever been raised in its 18 year history.

Latest News: Senate Approves SGR Repeal, Keeps Therapy Cap and Exceptions Process - April 15, 2015

How to Take Action

  • Email your legislators. APTA has provided prewritten letters for APTA members on the Legislative Action Center and for nonmembers/patients on the Patient Action Center. You can also send letters through the APTA Action App.
  • Meet with your legislators. Schedule a district meeting, attend a town hall event, or invite your legislators to visit your practice over recess. This is a great opportunity to meet with your members of Congress locally and discuss the importance of repealing the therapy cap.
  • Join PTeam. Join the PTeam to receive email updates on the latest therapy cap news and receive alerts when it is time to take action and contact your members of Congress on these reform policies.

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