Medicare Patients May Exceed Therapy Caps The Centers for Medicare and Medicaid Services (CMS) will allow an automatic exception from the $1,740 therapy cap to beneficiaries whose diagnosis requires concurrent physical therapy and speech-language pathology services, as well as other specified diagnoses and conditions. The recently enacted Deficit Reduction Act of 2005 required CMS to develop ... Bottom Line
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Bottom Line  |   March 01, 2006
Medicare Patients May Exceed Therapy Caps
Author Notes
  • Ingrida Luis, is ASHA’s director of health care regulatory advocacy. Contact her by e-mail at ilusis@asha.org.
    Ingrida Luis, is ASHA’s director of health care regulatory advocacy. Contact her by e-mail at ilusis@asha.org.×
Article Information
Practice Management / Bottom Line
Bottom Line   |   March 01, 2006
Medicare Patients May Exceed Therapy Caps
The ASHA Leader, March 2006, Vol. 11, 1-21. doi:10.1044/leader.BML2.11042006.1
The ASHA Leader, March 2006, Vol. 11, 1-21. doi:10.1044/leader.BML2.11042006.1
The Centers for Medicare and Medicaid Services (CMS) will allow an automatic exception from the $1,740 therapy cap to beneficiaries whose diagnosis requires concurrent physical therapy and speech-language pathology services, as well as other specified diagnoses and conditions. The recently enacted Deficit Reduction Act of 2005 required CMS to develop a process by which beneficiaries could receive medically necessary services above the therapy caps.
CMS issued implementation instructions to contractors on Feb. 13 that outlined the retroactive exceptions process; these “exceptions” describe diagnoses and conditions that exempt patients from the caps beginning Jan. 1. Speech-language pathologists whose claims have been denied because of the cap should contact their Medicare contractor to request that the claim be reopened and reviewed to determine if the beneficiary would have qualified for the exception.
Types of Exceptions
Exceptions fall into two categories:
Automatic exceptions
  • Certain evaluation services, such as speech evaluation and swallowing evaluation, are excepted from the caps. The affected Current Procedural Terminology codes are 92506, 92597, 92607, 92608, 92610, 92611, 92612, 92614, 92616, and 96105.

  • Certain conditions and complexities when supported by documentation justifying the need for therapy services.

  • Additional exceptions as allowed by the local contractor.

Manual exceptions
  • The provider makes a formal request to the contractor. The contractor makes a determination to allow additional treatment based on documentation submitted by the provider.

A request to the contractor is not required for automatic exceptions, but is required for manual exceptions. The exceptions process only applies to current conditions for which a patient is receiving therapy services. SLPs should use the KX modifier only when documentation supports the need for services above the cap. Frequent use of the modifier could elicit additional scrutiny by the contractor.
Automatic Exception
After reviewing ASHA’s National Outcomes Measurement System and existing Medicare claims, CMS developed a list of diagnosis codes for which services would most likely exceed the cap. If a beneficiary has a diagnosis designated as excepted, and exceeds the caps due to medically necessary services, additional services would be permitted. In this situation, each SLP service must be submitted with a KX modifier once they exceed the cap. Although services may meet the automatic exceptions criteria for the condition and other factors, the claims are still subject to contractor review to determine that the services are otherwise covered and appropriately provided.
CMS has indicated that it does not anticipate that many of the therapy services provided to beneficiaries presenting with one of the excepted diagnoses will exceed the cap. The modifier represents the attestation of the therapist that the patient has a condition or complexity on the list for which they are currently being treated and which is causing the services to exceed the caps.
Documentation must include the disorder treated, other comorbidities and complexities, and how these factors affect treatment. The condition or complexity must directly and significantly affect the type, frequency, intensity, and duration of the required, medically necessary skilled services over the cap. Frequent use of the modifier could result in additional scrutiny by the contractor.
Other Clinical Complexities
Other factors may justify automatic exception for any condition that requires skilled therapy services, regardless of whether the primary diagnosis is excepted. Therapy rendered above the cap must be documented, covered, and medically necessary. The following situations may be taken into consideration for automatic exceptions:
  • The beneficiary was discharged from a hospital or SNF within 30 treatment days of starting the episode of outpatient therapy.

  • The beneficiary has, in addition to another disease or condition being treated, generalized musculoskeletal conditions or conditions affecting multiple sites not listed as automatically excepted by conditions that will directly and significantly impact the rate of recovery.

  • The beneficiary has a mental or cognitive disorder in addition to the condition being treated that will directly and significantly impact the rate of recovery.

  • The beneficiary requires physical therapy and speech-language pathology services concurrently. If the combination of the two services causes the cap to be exceeded for necessary services, the services are excepted.

  • The beneficiary had a prior episode of outpatient therapy during the calendar year for a different condition.

  • The beneficiary does not have access to outpatient hospital therapy, including residents of a SNF subject to consolidated billing.

Requesting an Exception
CMS notes that there will be instances when a diagnosis does not qualify for an automatic exception, but a beneficiary may benefit from additional services above the cap. In this case, the provider must request coverage of additional services in writing to the CMS contractor. This request should be faxed unless the contractor requests another form of communication. SLPs are encouraged to submit a request as soon as a determination is made that the patient will exceed the cap, but would benefit from additional services. The letter of request must include all pertinent portions of the medical record and a justification for a specific number of treatment days, not to exceed 15.
Documentation Plays Critical Role in Cap Exceptions

Documentation continues to play a critical role in evaluating the need for Medicare outpatient therapy services and is usually reviewed by Medicare contract nurses rather than SLPs. In maintaining and submitting documentation, an SLP should not assume that the reviewer will understand why the service requires the skill of an SLP and should include additional information.

CMS states that objective evidence consists of standardized patient assessment instruments, outcomes measurement tools or measurable assessments of functional outcomes. The agency also states that the use of objective measures at the beginning of treatment, during and/or after treatment is recommended to quantify progress and support justification for continued treatment. While such tools are not required, CMS does state that they will enhance the justification for the need of therapy.

ASHA’s National Outcomes Measurement System (NOMS) was used by CMS to help determine the range of speech-language pathology diagnoses for the Medicare therapy cap exceptions process. SLPs are encouraged to participate in outcomes reporting and benchmarking by becoming a NOMS-certified user.

When in doubt, contact the Medicare contractor and request that they provide educational models or in-service staff training on documentation. You should consider coordinating this with your state association to make the invitation more attractive to the contractor and provide access to more of your colleagues.

CMS has outlined its minimal documentation requirements in its Benefit Policy Manual. SLPs should monitor their Medicare contractor’s Web site for additional updates as there may be changes made to the local coverage determinations as a result of CMS instructions. All therapy notes must be signed by the qualified professional and include credentials. When a student is assisting, the student may write the documentation, but the signature of the SLP is required.

Required Documentation

When submitting documentation to the contractor, provide the following information unless otherwise specified by the contractor:

Evaluation and Certified Plan of Care, including initial evaluation and reevaluation relevant to the episode being reviewed. It should include:

  • a diagnosis and description of the specific problem being evaluated and or treated

  • objective measures, preferably a standardized patient assessment instrument or outcomes measurement tool related to current functional status

  • clinician’s clinical judgment or subjective impressions of the patient’s condition

  • determination of the need for treatment

Certification

  • assurance that the patient is under the care of a physician

Progress Reports (when treatment exceeds 10 treatment days or 30 calendar treatment days/one month, whichever is less). The clinician must complete a progress report at least once during each interval of treatment. The progress report should include:

  • date of the beginning of the treatment interval

  • date the report was written

  • signature of the qualified professional

  • objective reports of the patient’s progress

  • objective measurements of changes in status relative to current goals

  • plans for continuing treatment

  • changes to long- and short-term treatment goals

Treatment Encounter Notes

These may also serve as progress reports when required information is included in the notes. The purpose of the encounter note is not to document medical necessity, but to create a record of all encounters and skilled intervention. Tips to keep in mind with encounter notes are as follows:

  • Documentation is required for every treatment day, and every therapy service.

  • The encounter note must record the name of the treatment, intervention or activity provided.

  • Total treatment time must be documented.

  • The signature of the professional delivering the service must be included.

If a treatment is added or changed between the progress note intervals, the change must be recorded and justified in the medical record. Frequent professional judgments resulting in upgrades to the patient’s activity show skilled treatment. Objective measurements showing improvement are very helpful.

If there is no improvement, explain the setbacks, illness, new conditions, or social circumstances that are impeding progress and why it is believed that progress is still attainable. Activities that are repetitive or routine, or easy enough to explain to an aide or caretaker could be questioned by the reviewer.

Exception to Therapy Caps The records must justify services over the cap. A separate justification statement may be included either as a separate document or within the other documents if the provider/supplier wishes to assure the contractor understands their reasoning for the use of the KX modifier.

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March 2006
Volume 11, Issue 4