Knowledge Base Article

When I first started working in healthcare compliance many moons ago, physical and occupational therapy were hot topics for Medicare review. The focus on therapy services for medical review has waxed and waned over the years since then, but here we are again with several Medicare Administrative Contractors (MACs) focusing on the review of therapy services. Palmetto JJ and JM are reviewing therapeutic exercise (CPT 97110) and manual therapy (97140 (JM only for now)); First Coast JN is reviewing physical, occupational, and speech services based on revenue codes (042x, 043x, and 044x), Novitas JH and JL are reviewing therapy services CPT codes describing therapeutic exercise and therapeutic activity (97110 and 97530), and recently WPS J8 added a review of therapeutic exercise (97110).

The good news is that documentation requirements for therapy services have not changed much over the years. The bad news is that despite consistent requirements, providers still often fail to get it right, resulting in denials for lack of medical necessity upon complex review.

Palmetto GBA offers a module that discusses the medical necessity and documentation requirements for therapeutic exercise, but this would apply equally to all therapy services and the requirements of all Medicare contractors. When I review therapy records, I instruct the therapists to “tell a good story” that describes what is wrong with the patient, what you plan to do about it, how this will benefit the patient, and then what you did and how the patient responded. This may sound over-simplified, so let’s examine these steps in more “clinical” terms.

1. What is wrong with the patient – The patient must have a disabling condition that results in a functional impairment that causes a significant change or loss in body function. There must be activity limitations and participation restrictions affecting the patient’s activities of daily living (ADLs).
2. The limitation is assessed during the therapy evaluation.
3. Examples of limiting conditions are weakness, stiffness, decreased range of motion, gait problem, balance deficit, pain resulting in one of these conditions, etc. Providers should refer to their MAC’s LCD addressing therapy requirements for more details concerning covered indications.
4. The therapist should describe the limitation in the evaluation, including body part and type of limitation, objective measurements, subjective observations, and description of the impaired ADLs.
5. When applicable include the onset date and cause, and any other conditions and complexities that may impact the patient’s treatment.
6. What you plan to do about it – This is the plan of care (POC) for the patient’s treatment. The therapist must select individualized exercises related to the patient’s impairment that address the goals for the patient (see number 3 below for a discussion of goals).
7. The treatment must require the skills of a therapist and documentation must justify why the services are skilled. This may involve teaching the patient the proper way to perform exercises, monitoring the patient medically, providing cues and instruction on exercise performance, assisting the patient for safety reasons, etc.
8. The plan must also include the expected amount, frequency, and duration of treatment required to reach the patient’s goals.
9. The POC must be certified and re-certified by the patient’s physician/practitioner initially and every 90 days if therapy continues.
10. How this will benefit the patient –There must be an expectation the patient will benefit from the therapy services. The expected benefit or outcomes are documented in the POC as therapy goals.
11. Notice the patient must “benefit” from therapy, not necessarily “improve.” Medicare covers restorative therapy when prior functional levels are partially or completely restored. Medicare also covers maintenance therapy to prevent or slow decline in patient function. For maintenance therapy, there must be documentation of a reasonable concern of deterioration in function without therapy.
12. Goals must be specific, measurable, and relate to the patient’s functional limitation(s).
13. What you did – This is the documentation of the daily treatment notes –exercises that were performed, patient needs (e.g. instruction, cueing) and response, and the treatment time.
14. The treatment note must include the date of treatment and a list of services provided.
15. Timed-code treatment minutes and total treatment minutes must be documented. Timed-code treatment minutes will be used to support services rendered and number of units billed.
16. All of the CPT codes targeted for MAC review are constant attendance codes. This means the therapy provider must have direct one-on-one contact with the patient.
17. Several CPT codes used for therapy modalities, procedures, and tests and measurements specify that the direct (one on one) time spent in patient contact is 15 minutes. When more than one service represented by 15-minute timed codes is performed in a single day, the total number of minutes of service determines the number of timed units billed. When reporting units of timed-codes to Medicare, providers follow the eight-minute rule. This means you do not bill if less than 8 minutes of timed-code therapy was provided in a day, you bill 1 unit for 8-22 minutes, 2 units for 23-37 minutes, etc. The complete time table can be found in the Medicare Claims Processing Manual, Chapter 5, section 20.2.
18. The daily treatment note must be signed by the clinician who provided the services that day, including notation of their credentials.
19. How the patient responded - Through on-going assessments, therapists determine how the patient is progressing toward the therapy goals. This may include comments in the daily notes, but must include a progress report at least every 10 treatment days and a discharge summary at the end of treatment.
20. The progress report/discharge summary must be prepared by a physician or therapist who has actively participated in the patient’s care at least once during the reporting period. Therapy assistants (PTAs and OTAs) can provide treatments but the progress reports and discharge summaries must be written by a therapist, the same as evaluations and plans of care.
21. These reports include an assessment of the patient’s progress or lack of progress towards the therapy goals based on objective measures, self-reported statements from the patient, and the therapist’s observations of function. If the patient is not progressing as expected, the therapist may need to modify goals and/or treatments.
22. Like all therapy documentation, these reports must be dated and signed by the author with their credentials noted.

Also remember that the patient must be under the care of a physician/practitioner during therapy. This is evidenced by the physician/practitioner’s signature certifying the Plan of Care. And although therapy caps went away, providers are still required to append the KX modifier to services beyond the KX modifier threshold to verify these services are medically necessary in order to receive payment. One bit of good news for 2019 is that Medicare no longer requires reporting of the functional limitation G-Codes and severity modifiers.

The bottom line for therapy reviews is that, as a therapy provider, if you follow Medicare’s rules for medically necessary treatments, certifications, calculating units, documentation, and “tell a good story,” you should be able to receive appropriate reimbursement from Medicare for the services you provide. Along with positive patient outcomes, what more could you ask for?