2014 Medicare Therapy Cap and its Medical Billing and Coding Implications

The healthcare industry has been continually evolving over the last decade with EMR reforms, Medicare inclusion, pay-for-performance reimbursement standards and ICD 10 coding changes. But there is one change that has been repeatedly causing government and care providers to worry about reimbursement rates and growth of their practices.

The Balanced Budget Act of ’97 introduced the sustainable growth rate (SGR) formula and Medicare Therapy cap to control the amount paid out in reimbursements and act as cost saving measures. However, due to erroneous SGR calculations and therapy cap threatening to restrict the entire reimbursement model of healthcare, policy makers have had to make adjustments in these two policies every year. 2014 has proven to2014 Medicare Therapy Cap and its Medical Billing and Coding Implications be no different either.

Medicare therapy cap, if installed in place can restrict the medical rehabilitation services covered under Medicare. With millions over the age of 65 coming under Medicare coverage this year, the therapy cap can be nothing short of disastrous. To better equip your medical practice for the Medicare therapy cap, you need to consider the following implications for your practice –

  • The amount of $1920 therapy will be extended to private practice physical therapy and speech language pathology. With an exceptions process, the therapy cap will apply to services furnished in outpatient therapy settings such as skilled nursing facilities (Part B), rehabilitation agencies (or ORFs), critical access hospitals, and comprehensive outpatient rehabilitation facilities (CORFs)
  • Exceptions process will be the biggest facilitator for medical billing and coding practitioners with the therapy cap reforms due from 1st March 2014. As per the exceptions process automatic exceptions and manual medical reviews can be made to the cap amount of $1920
  • For therapy procedures that exceed the limit of $1920 upto $3700 within a period of three months, from 1st January 2014 to31st March 2014; automatic exception will be captured in the system at the time of claim filing if justifiable reasons for continual therapy can be established
  • For therapy procedures surmounting to more than $3700 between 1st January 2014 & 31st March 2014, claims will be subject to manual medical reviews before deciding on Medicare reimbursements. While in the previous case, medical billers would conveniently opt for automatic exception, continue therapy with higher reimbursement amount to be claimed will face intense scrutiny from carriers
  • In order to avail automatic as well as manual exceptions, medical billing and coding practitioners will have to add a KX modifier to the therapy procedure code. This is an additional coding practice which in addition to ICD 10 and CPT changes can greatly impact the rate of medical reimbursements in times to come

Medicalbillersandcoders.com hosts the services of Medicare experts and medical billing and coding experts with years of experience in providing guidance to medical providers as well as billing solutions. At this crucial time, you will need a billing partner that can understand the revenue processes of your medical practice and align them well with changing Medicare requirements. Medicalbillersandcoders.com is a billing partner that can facilitate your transactions and claim filing under Medicare therapy cap, leaving you sufficient time to focus on your patients.