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Physical therapy services represent a significant portion of Medicare expenditures in post-acute care settings.

Physical therapy services represent a significant portion of Medicare expenditures in post-acute care settings — services provided in inpatient rehabilitation facilities, or IRFs, long-term care hospitals, or LTCHs, skilled nursing facilities, or SNFs, and via home health agencies, or HHAs, under Medicare Part A.

PTs practicing in post-acute care are integral to improving the quality of care provided to patients while reducing overall costs. This is particularly true under new value-based payment initiatives such as bundled payment models, accountable care organizations, and patient-centered medical homes.

APTA supports health care payment reforms in post-acute care when they ensure access to physical therapy services that focus on the unique needs of patients. However, changes being made to the payment systems for IRFs, SNFs, LTCHs, and HHAs could have a drastic impact on the profession.

The resources on this page will help you prepare for the post-acute care reforms that are being implemented now and over the next several years.

Also See

Study: Therapy Outcomes in Post-Acute Care Settings
APTA and the American Occupational Therapy Association commissioned a first-of-its-kind study showing that physical therapy and occupational therapy are connected to positive impacts on patients in SNF, IRF, and home health settings. The TOPS study reviewed 1.4 million Medicare cases and has implications for ongoing implantation of postacute care payment system reforms and for the development of any future unified prospective payment system. Lean more:

Medicare Payment for Home Health
We help you keep track of evolving payment policies for home health.

Medicare Payment for Hospital Settings
We help you keep track of evolving payment policies for hospital settings.

Medicare Payment for Skilled Nursing Facilities
We help you keep track of evolving payment policies for SNFs.

MedPAC Resources

(Transition to the Unified Post-Acute Care Prospective Payment System)

Ongoing IMPACT Act Implementation

On Sept. 18, 2014, Congress passed the Improving Medicare Post-acute Care Transformation Act of 2014 (IMPACT Act). The Act requires the submission of standardized data by LTCHs, SNFs, IRFs, and HHAs. Additionally, the Act requires the development and reporting of measures pertaining to resource use, hospitalization, and discharge to the community. Through the use of standardized quality measures and standardized data, the intent of the Act, among other obligations, is to enable interoperability and access to longitudinal information for such providers to facilitate coordinated care, improved outcomes, and overall quality comparisons.

In implementing the IMPACT Act, CMS established quality-reporting programs for HHAs, IRFs, LTCHs, and SNFs. Additional information about the IMPACT Act and each setting-specific quality-reporting program can be found below.

New Payment Methodologies for SNFs and Home Health Agencies

CMS implemented significant changes that affected payment for SNFs beginning in FY 2020 and for home health services beginning in CY 2020. These new payment methodologies are the Patient-Driven Payment Model, or PDPM, in skilled nursing facilities and the Patient-Driven Groupings Model, or PDGM, in home health. 

Documentation and Billing: What You Need to Know

Review the list of ICD-10-CM codes to be used for discharges and patient encounters for the applicable fiscal year. (Discharge is the point at which the patient leaves the setting and either returns home or is transferred to another facility. The term "encounter" is used for all settings, including hospital admissions, and describes an interaction between a patient and health care provider (i.e., a visit).

Post-acute PPS Assessments Guidance Manuals

Post-acute PPS assessment manuals provide guidance for facilities and agencies on collecting accurate data through the assessment tool. These tools include both general data-collection conventions and item-specific guidance, as well as links to quality-related resources for agencies and facilities.