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Extension of Therapy Cap Exceptions
Medicare Improvements for Patients and Providers Act 2008
Background
On July 15, 2008, the Medicare Improvements for Patients and Providers Act of 2008 was enacted, making changes to the Medicare program. One provision of this legislation extends the effective date of the exceptions process to the therapy caps to December 31, 2009. Outpatient therapy service providers may now resume submitting claims with the KX modifier for therapy services that exceed the cap furnished on or after July 1, 2008.
Information about some of the changes is outlined below.
Therapy Caps
The law reinstated the therapy caps exceptions process as of July 1, 2008. Therefore, medically necessary therapy services, in excess of the therapy caps, will continue to be paid by Medicare in accordance with the exceptions process. Claims submitted with the therapy cap exception modifier will be processed as soon as the payment rates have been activated. Claims submitted without the modifier, and rejected or denied, can be resubmitted with the modifier for reimbursement. To the extent possible, claims under the therapy cap limit, which were paid at the lower rate, will be reprocessed automatically.
For physical therapy and speech language pathology services combined, the limit on incurred expenses is $1810 for calendar year 2008. For occupational therapy services, the limit is $1810. Deductible and coinsurance amounts applied to therapy services count toward the amount accrued before a cap is reached. Services that meet the exceptions criteria and report the KX modifier will be paid beyond this limit.
Before this legislation was enacted, outpatient therapy service providers were previously instructed to not submit the KX modifier on claims for services furnished on or after July 1, 2008. The extension of the therapy cap exceptions is retroactive to July 1, 2008. As a result, providers may have already submitted some claims without the KX modifier that would qualify for an exception.
In all cases, if the beneficiary was notified of their liability and the beneficiary made payment for services that now qualify for exceptions, any such payments should be refunded to the beneficiary.
More information on therapy caps is available at http://www.cms.hhs.gov/TherapyServices/
Durable Medical Equipment (DME)
The Durable Medical Equipment Competitive Bidding Program, which affects only Medicare beneficiaries in traditional fee-for-service in 10 competitive bidding areas, has been delayed. Medicare beneficiaries may use any Medicare-approved supplier for Durable Medical Equipment. If a beneficiary changed suppliers when this new program started (July 1, 2008), they can either continue to use the new supplier or choose another supplier. The original DME payment rates in effect prior to July 1 are reinstated retroactively. All Medicare households in the 10 competitive bidding areas will be notified of this change directly in a letter from CMS within two weeks. The DME Competitive Bidding areas are: (1) Charlotte-Gastonia-Concord, NC-SC, (2) Cincinnati-Middletown, OH-KY-IN, (3) Cleveland-Elyria-Mentor, OH, (4) Dallas-Fort Worth-Arlington, TX, (5) Kansas City, MO-KS, (6) Miami-Fort Lauderdale-Miami Beach, FL, (7) Orlando-Kissimmee, FL, (8) Pittsburgh, PA, (9) Riverside-San Bernardino-Ontario, CA, and (10) San Juan, PR. Information on payment rates and claims processing will be communicated to DME suppliers in the coming days.
More information on DME is available at http://www.cms.hhs.gov/DMEPOSCompetitiveBid/
Physician Pay
As a result of the new law, the mid-year 2008 Medicare Physician Fee Schedule (MPFS) rate reduction of -10.6 percent is retroactively replaced with the fee schedule rates in effect from January to June, 2008, which reflected a 0.5 percent update from 2007 rates. In addition, MPFS payment rates are being revised to increase the fee schedule amounts for certain mental health services. Effective immediately, CMS has instructed its contractors to implement the new law. However, it may take up to 10 business days to implement these changes. To minimize physician disruption during this transition, CMS will post the new physician fee schedule as soon as possible and will continue its rolling 10 day hold and release of claims. This means that, until the new fee schedule rates are implemented, some claims may still be paid at the lower rates that were in effect between July 1st and July 15th. To the extent possible, contractors will begin to automatically reprocess any claims paid at the lower rates in a timely manner. CMS will issue guidance about the collection of corrected co-insurance payments in the next few days.
More information on physician pay issues is available at http://www.cms.hhs.gov/PhysicianFeeSched/
Added July 17, 2008 |
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