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Many physical therapists (PTs) will face a new payment landscape beginning in January, now that the US Centers for Medicare and Medicaid Services (CMS) has finalized a rule that ends functional limitation reporting (FLR) and moves certain PTs into the Quality Payment Program (QPP). That program, which includes the Merit-based Incentive Payment System (MIPS), is at the center of a sweeping shift toward value-based payment in Medicare.

The confirmation of PTs' inclusion in QPP came in conjunction with the release of the final 2019 physician fee schedule. For PTs and physical therapist assistants (PTAs), the final versions by-and-large mirror the rule proposed by CMS earlier this year. But a few important changes and clarifications, some in response to comments from APTA and other stakeholders, are worth noting—particularly in regard to the way CMS wants to approach coding and paying for services delivered totally or "in part" by a PTA or occupational therapy assistant (OTA).

APTA regulatory affairs staff are reviewing the final rule and will publish a detailed summary in the coming weeks. In the meantime, here are some highlights.

Bottom line: get ready for MIPS and other components of the QPP.
It's official: beginning in 2019, PTs in private practice who furnish services under Medicare are included in QPP, an entirely new payment system for the profession. Under QPP, qualifying PTs have a choice of participating in the Merit-based Incentive Payment System (MIPS) or—if available to them—an advanced alternative payment model (Advanced APM). A subset of these PTs who meet volume thresholds will be required to participate in one or the other. PTs in private practice who don't qualify for participation in MIPS can do so voluntarily, something APTA encourages given that all signs point to further expansion of the QPP in the future.

The program—particularly MIPS—is largely centered on reporting requirements. MIPS requires reporting in 4 performance categories (PTs in 2019 will be required to report under only 2 categories: quality and improvement activities), with providers earning points in each category. An annual MIPS score will determine whether the providers earn a payment incentive, remain neutral in payment, or are subject to a penalty. Several of the data points must be reported electronically through certified electronic health record (EHR) vendors or registries such as APTA’s Physical Therapy Outcomes Registry.  

The Advanced APM-based QPP option allows participants to be exempted from MIPS and opens up the possibility of a 5% annual payment bonus (beginning in 2021 for the 2019 performance year) in addition to payment adjustments up or down; however, certain patient or payment thresholds must be met. The rule also includes an option for QPP participation through a Medicare Advantage demonstration.

In addition to its acknowledgement of PTs as providers who are integral to the evolution toward value-based care, CMS also included a welcome change: the elimination of functional limitation reporting (FLR), a fraught system that met with criticism from APTA since its implementation.

But that's just the big-picture picture. PTs and PTAs are well-advised to learn as much as possible about QPP and MIPS sooner rather than later, and to understand how this major shift may impact their practice. Scroll down to the end of this article for suggested links that help to fill in the details of how the program works.

In terms of the fee schedule itself, the required adjustment factor for 2019 is 0.25% before applying other adjustments. But remember: this is the last year there will be an update to the physician fee schedule through 2025. Beginning in 2026, payment rates will be updated based on the eligible clinician’s participation in MIPS or Advanced APMs.

CMS efforts to clarify PTA-related coding are a mixed bag.
CMS was required by law to establish modifiers to indicate services provided by PTAs and OTAs. In the final rule, CMS clarifies that services furnished in whole or in part by a PTA or OTA will be identified –through payment modifiers—"CQ" for services delivered by a PTA and "CO" for services delivered by an OTA. The definitions of the therapy services codes (GP, GO, GN) remain unchanged. The new payment modifiers for services furnished by PTAs and OTAs are not required on claims until January 1, 2020.

The PTA and OTA issue isn't just about coding, however. CMS is also attempting to specify what it means by services delivered "in part" by a PTA or OTA. Despite significant advocacy efforts by APTA and other stakeholders, CMS made only a moderate change between the proposed and final definition of services furnished “in part.” In the final rule, CMS adopts a "de minimis" standard, establishing that anything over 10% of the total patient service delivered by a PTA constitutes "in part" services. Although many questions remain, CMS has stated it will further clarify the de minimis standard in 2020 rulemaking. APTA had advocated that CMS hold off on making a final decision on this issue until the agency gathered more information from stakeholders or, if it did move forward, that it adopt a higher bar for what constituted services delivered "in part" by a PTA or OTA.

The modifiers and definition of services furnished “in part” are crucial concepts as CMS moves toward the implementation of an 85% payment differential for services delivered "in part" by PTAs beginning in 2022. There will be more opportunities for APTA to advocate on changes to the definition of “in part” in future fee schedules leading up to the 2022 final rule, and the association will continue to advocate for changes to the proposal. Among the association's concerns: the potential impact of the differential on patient access, particularly in rural and medically underserved areas.

The KX modifier isn’t going away, and the therapy threshold amount will get a (tiny) boost.
As CMS prepares for its second year in a post-therapy cap environment, it's holding on to the KX modifier process for claiming outpatient therapy services over a specified amount—next year, $2,040, compared with $2,010 in 2018. As is the case in 2018, that amount will be for physical therapy and speech-language pathology services combined.

CMS will consider ways to facilitate participation in Advanced APMs by nonphysicians who may not use certified electronic health record technology (CEHRT) due to lack of certified systems for their specialties.
APTA joined a host of other commenters in suggesting that nonphysician provider participation in Advanced APMs would be hindered by a CMS proposal to increase the CEHRT minimum use threshold—an important consideration, given that participation in an Advanced APM is one way qualified providers are supposed to be able to meet QPP requirements. The argument made by APTA and others was that CEHRT standards are built around the particulars of physician-focused electronic health records (EHRs) that aren't as applicable to nonphysician EHRs, thereby creating an artificial barrier to nonphysician participation in APMs.

Not so, CMS responded in the final rule. "We reiterate that the Advanced APM minimum CEHRT-use threshold applies to APMs and the requirements they impose on participating APM Entities, not to the individual APM Entities participating in APMs," CSM writes. "This means there can be a percentage of eligible clinicians participating in an APM Entity who are not using CEHRT and the APM Entity will still be in compliance with the APM’s terms and conditions." However, CMS has promised to monitor the situation and consider possible solutions to facilitate participation in Advanced APMs by nonphysicians and nonprescribing eligible clinicians in the future.

PTs are still mostly excluded from allowances for telehealth—but APTA has convinced CMS to think about making changes.
Despite APTA's advocacy, the final rule allowing for "virtual check-ins" applies only to providers who are qualified for reimbursement for evaluation/management services—in other words, not PTs. Additionally, PTs aren't included among providers who can be reimbursed for "interprofessional internet consultations."

This situation is fluid, however. CMS responded to APTA’s calls for more PT inclusion in telehealth by stating that it would consider exploring a demonstration or pilot through its Center for Medicare and Medicaid Innovation. And if a proposed Medicare Advantage (MA) rule is any indication, CMS may be seeing the light—that proposal allows MA plans to include telehealth services as a "basic benefit," and APTA is pressing for PTs to be included in the list of qualified providers who may furnish telehealth services to MA enrollees.

"All in all, the final fee schedule and QPP rule is what was expected, but what was expected is a significant shift in payment methodology," said Kara Gainer, APTA's director of regulatory affairs. "It's now critically important that physical therapists learn as much as possible about QPP and how they can best navigate the new system."

Learn more about QPP, MIPS, and APMS

  • APTA's MIPS webpage: includes articles, recorded webinars, podcasts, decision-making guidance for voluntary participation, links to a MIPS discussion board, and more.
  • APTA's QPP webpage: take a readiness quiz, watch a short video, download recorded webinars, get detailed fact sheets, connect with other websites, and more.
  • "Moving Toward Quality Payment" (November PT in Motion magazine feature)

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