Scroll down this page for info on topics including the Medicare fee schedule and therapy cap, CJR, new evaluation codes, quality payment programs, and more.
New Year, New Changes
Following years of advocacy by physicians, physical therapists, and other health care professionals, in 2015 Congress repealed the flawed sustainable growth rate (SGR) formula. The law, the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA), established 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 extended the therapy cap exceptions until December 31, 2017, and mandated criteria for targeted medical review for certain cases over the $3,700 threshold.
Changes for 2017 regarding fee schedule payment rates include the following:
Effective for services provided on or after January 1, 2017, the 2017 fee schedule conversion factor is 35.8887, which reflects the +0.5% update factor specified under MACRA, a budget neutrality adjustment of –0.013%, a –0.07% nonbudget-neutral multiple procedure payment reduction (MPPR) adjustment for imaging services, and the –0.18% target recapture amount. The projected impact of other changes in the rule on outpatient physical therapy services in aggregate is 0.0% in 2017. The actual impact on individual physical therapy practices will depend on the mix of services provided.
Changes for 2017 regarding the therapy cap include the following:
- The therapy cap amount for 2017 is $1,980 (up from $1,960) for physical therapy and speech language pathology combined, with a separate $1,980 cap for occupational therapy.
- Providers may obtain an exception to the therapy cap until the provision for exceptions expires December 31, 2017.
MACRA extended the targeted manual medical review process, with a $3,700 threshold, through 2017. Under this process, CMS determines which therapy services to review by considering specific factors, which include: (1) 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. CMS has contracted with Strategic Health Solutions to serve as the Supplemental Medical Review Contractor (SMRC). The SMRC is your initial contact point should you receive an ADR. Once you submit your information, the SMRC has 45 days to return a decision. After that, the SMRC will take no further action—although it can turn over your claim to the Medicare Administrative Contractor for further review.
Medicare Payment Updates and Policy Changes
The Centers for Medicare and Medicaid Services (CMS) issued several payment updates and policy changes that will affect outpatient physical therapy and home health providers for 2017.
APTA has developed the following final rule summaries for members:
APTA has updated the 2017 Medicare Fee Schedule calculator to reflect the most up to date values issued by the Center for Medicare and Medicaid Services. There is also a tool to available to assess your payment with the application of the Multiple Procedure Payment Reduction (MPPR) policy
Medicare Access and CHIP Reauthorization Act (MACRA)
The Medicare Access and CHIP Reauthorization Act (MACRA) offers providers a unique mechanism to meet quality improvement benchmarks and receive incentive payments by forming Advanced Alternative Payment Models (Advanced APMs). These models will be structured to mirror the MIPS quality measures, while serving a unique patient population with efficient and high-quality care. These Frequently Asked Questions can help you learn more about Advanced APMs and the financial incentives for participants. The FAQ will be updated periodically as more information becomes available from CMS.
MACRA is the first tangible step toward mandating a payment system that bases reimbursement on quality of care and outcomes, and begins the phase-out of fee-for-service.
The policies contained in MACRA not only affect Medicare payment but also set forth payment polices that will extend to commercial payers as well. The Centers for Medicare and Medicaid Services has established a new quality payment program that provides a roadmap for how providers can comply with the Merit-Based Incentive Payment System (MIPS), and how they can participate in alternative payment models such as accountable care organizations and patient-centered medical homes. Although PTs are not eligible for mandatory participation under MIPS beginning in 2017, the proposed rule does allow for voluntary reporting in order to prepare PTs for mandatory participation in the future. APTA strongly encourages members to begin voluntary reporting this year, as it will allow the physical therapy profession to assess our readiness for mandatory participation and advocate for policy changes necessary to ensure that PTs can be successful in MIPS. Please check out APTA resources here to help you prepare.
New Evaluation and Reevaluation Codes
Medicare is implementing the 3 new tiered evaluation codes and 1 new reevaluation code descriptors as published by the AMA in its CPT 2017 manual. These new codes have been added to the list of "always" and will covered by Medicare beginning January 1, 2017. Although Medicare will continue to pay a single value for the tiered evaluation codes, it is imperative that you understand how to code your patient evaluations correctly. You can find APTA resources to help you make the appropriate determinations on our webpage dedicated to the new evaluation and reevaluation codes.
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, are impacted under this 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 via the Improving Medicare Post-Acute Care Transformation Act (IMPACT) 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.
Functional Limitation Reporting
Despite changes elsewhere in payment and quality reporting, functional limitation reporting continues in 2017 as before. APTA has numerous resources to help you navigate functional limitation reporting, including an online complaint form for members in need of staff assistance.