Scroll down this page for info on topics including the Medicare fee schedule and therapy cap, CJR, SGR, PQRS, functional limitation reporting, and more.
New Year, New Changes
Following years of advocacy by physicians, physical therapists, and other health care professionals, Congress passed a bill to repeal the flawed SGR formula on April 14, 2015. The Medicare Access and CHIP Reauthorization Act of 2015 establishes a framework to move Medicare from a largely fee-for-service program to a program that bases payment on quality and improved outcomes. In addition, the law extends the therapy cap exceptions until December 31, 2017, and mandates criteria for targeted medical review for certain cases over the $3700 threshold.
Changes that are in effect regarding fee schedule payment rates include the following:
- Effective for services provided on or after January 1, 2016, CMS implements an update factor of 0.5%. The 2016 conversion factor is $35.8043 (down slightly from $35.9335 in 2015), which reflects a budget neutrality adjustment of 0.9999, the 0.5% update factor, and the 0.77% target recapture amount factor. The projected impact of other changes in the rule on outpatient physical therapy services in aggregate is 0.0% in 2016. The actual impact on individual physical therapy practices will depend on the mix of services provided.
Changes in effect regarding the therapy cap include the following:
- The therapy cap amount for 2016 is $1,960 (up from $1,940) for physical therapy and speech language pathology combined, with a separate $1,940 cap for occupational therapy.
- Providers may obtain an exception to the therapy cap until December 31, 2017.
As a result of the Medicare Access and CHIP Reauthorization Act, the manual medical review process at $3,700 is replaced with a new medical review process. Under this new process, CMS will determine which therapy services to review by considering factors. These factors would include: (1) reviewing providers with patterns of aberrant billing practices compared with their peers; (2) providers with a high claims denial percentage or who are less compliant with applicable Medicare program requirements; and (3) newly enrolled providers.
Medicare Payment Updates and Policy Changes
The Center for Medicare and Medicaid Services (CMS) has issued several payment updates and policy changes that will affect outpatient physical therapy and home health providers for calendar year 2016. These updates and changes are included in the Medicare Physician Fee Schedule, and Home Health Prospective Payment System.
APTA has developed the following final rule summaries for members:
Also, APTA's Fee Schedule Calculators have been updated for members to reflect 2016 payment rates.
Comprehensive Care for Joint Replacement Model (CJR)
The Comprehensive Care for Joint Replacement Model (CJR) began April 1, 2016, for Medicare for patients in designated geographic areas undergoing total knee and total hip replacements. Providers across all settings, including physical therapists, will be impacted under this this new alternative payment model. Take a moment to learn about this model and determine if you should be thinking of marketing your practice to a CJR program. APTA has resources to get you started.
Medicare Postacute Care Reform
Medicare postacute care reform continues to move forward with implementation of new quality measures and data collection requirements across all settings this year. For more information on postacute care reform, please see our webpage.
Physician Quality Reporting System (PQRS)
Physical therapists will face changes to Physician Quality Reporting System (PQRS) measures specifications in the new year. There is a requirement for physical therapists in private practice to report 9 individual measures (or up to 8, if 9 measures are not applicable) via claims or registry under the PQRS program to avoid the 2017 2.0% payment penalty.
APTA has updated its PQRS resources to reflect the 2016 measures changes. Also check out PQRS discussions on the Medicare: Quality Reporting Hub Community for answers to questions on PQRS reporting.
Functional Limitation Reporting
APTA has numerous resources to help you navigate functional limitation reporting, including an online complaint form for members in need of staff assistance.