Medicare Compliance & Reimbursement

CMS offers 3 key changes to the therapy cap for outpatients.

The therapy cap will go from $1,740 to $1,780 in 2007 for both PT/SLP and OT, the Centers for Medicare & Medicaid Services (CMS) says in Transmittal 1106. But that's not where the changes stop. Get to know these important highlights from the latest exceptions process. 1. Cap Amount Bumps Up Same as last year, the transmittal outlines two therapy cap categories: one for physical therapy (PT) and speech language pathology (SLP), and another for occupational therapy (OT). But CMS raised the therapy cap amount for both categories from $1,740 in 2006 to $1,780 in 2007.

Details: The 20 percent coinsurance still applies, requiring you to bill the 20 percent balance to secondary insurance or hold the beneficiary responsible for it, says Joanne Byron, LPB, BSNH, CPC, CHA, president of Health Care Consulting Services Inc. in Hickory, NC.

The beneficiary exhausts the cap when the physician fee schedule's allowed amounts are applied to all therapy claims submitted for each respective cap. "This is an annual financial limitation assigned to each beneficiary," Byron adds. "Once the limitation is reached, it is exhausted until the beginning of the next calendar year."

But once the limitation is reached you have the option of an automatic or manual exceptions process, notes Rick Gawenda, PT, director of physical medicine and rehabilitation at Detroit Receiving Hospital.

Remember: For claims with dates of service between Jan. 1 through Dec. 31, 2007, "Medicare shall apply these financial limitation in order, according to the dates when the claims were received," the transmittal notes. 2. Multiple Conditions Clarified The original transmittal (855) said that one qualifier for an automatic exception was if a therapy patient was discharged and returned the same year with a second, separate condition.

"But it didn't say what to do if a therapist is treating the patient for one condition while a second condition arises during the treatment for the first condition," Gawenda points out.

Now, as long as both services are medically necessary, the beneficiary will qualify for an automatic exception, according to the latest transmittal. And "it is not required that any of these conditions be on the list of automatic process exceptions," CMS says.

Clarification: You would need to include the new condition or complexity in the patient's current plan of care "and become part of the same episode of care." That means if a patient is receiving treatment for a condition that does not qualify for an automatic exception but develops a second condition that may or may not qualify, "the presence of the second condition" added to the same plan of care allows you to use the automatic exception for both conditions, the transmittal clarifies.

In [...]