Medicare Manual Review Rules to Affect Providers Claims for all Medicare outpatient therapy services that exceed $3,700 for a single beneficiary—with no exceptions for any diagnoses—will be subject to medical review, according to newly released guidelines. Providers must request pre-approval to ensure reimbursement. The Middle Class Tax Relief and Job Creation Act mandates the Centers for Medicare ... Bottom Line
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Bottom Line  |   August 01, 2012
Medicare Manual Review Rules to Affect Providers
Author Notes
  • Lisa Satterfield, MS, CCC-A, director of health care regulatory advocacy, can be reached at lsatterfield@asha.org.
    Lisa Satterfield, MS, CCC-A, director of health care regulatory advocacy, can be reached at lsatterfield@asha.org.×
  • Mark Kander, director of health care regulatory analysis, can be reached at mkander@asha.org.
    Mark Kander, director of health care regulatory analysis, can be reached at mkander@asha.org.×
Article Information
Practice Management / Bottom Line
Bottom Line   |   August 01, 2012
Medicare Manual Review Rules to Affect Providers
The ASHA Leader, August 2012, Vol. 17, 4. doi:10.1044/leader.BML1.17102012.4
The ASHA Leader, August 2012, Vol. 17, 4. doi:10.1044/leader.BML1.17102012.4
Claims for all Medicare outpatient therapy services that exceed $3,700 for a single beneficiary—with no exceptions for any diagnoses—will be subject to medical review, according to newly released guidelines. Providers must request pre-approval to ensure reimbursement.
The Middle Class Tax Relief and Job Creation Act mandates the Centers for Medicare and Medicaid Services (CMS) to conduct “manual medical review” of 2012 claims that exceed $3,700 (for combined speech-language treatment and physical therapy) on or after Oct. 1. Its language was similar to a 2006 rule that allowed exceptions for certain diagnoses, including aphasia and dysphagia (“Manual Medical Review: Are You Ready?”, The ASHA Leader, July 3).
The new guidelines, however, do not include those exceptions.
Under the three-phase process, providers will be categorized by facility type, then ranked by claims volume and number of high-utilization patients.
The reviews for Phase 1 (providers who submit high volumes of Medicare Part B therapy claims and/or who have individual clients with high usage) begin Oct. 1; Phase 2 (mid-range providers) begins Nov. 1; Phase 3 (low-range providers) begins Dec. 1.
Providers can request pre-approval for services above $3,700 in 20-treatment-day increments. Medicare Administrative Contractors (MACs) have 10 business days to respond. Requests that do not receive notification within 10 days are automatically approved. Claims submitted above the $3,700 without approval will be stopped and subject to standard medical review process (45 days for the provider to submit records, 60 days for the MAC to respond).
The process timeline includes:
  • Sept. 1—Providers receive their phase assignment by U.S. mail and at Centers for Medicare and Medicaid Services.

  • Oct. 1—All therapy services submitted for payment since Jan. 1, 2012, are totaled in beneficiaries’ master files (available in the Health Insurance Transaction System and in the beneficiary eligibility file). Providers must ensure that therapy services beyond $1,880 include the –KX modifier. Phase 1 providers must request pre-approval for therapy services beyond $3,700.

  • Nov. 1—Manual medical review for Phase 1 providers continues; Phase 2 providers must request pre-approval for therapy services beyond $3,700.

  • Dec. 1—Manual medical review for Phase 1 and 2 providers continues; Phase 3 providers must request pre-approval for therapy services beyond $3,700.

  • Dec. 31—Manual medical review and exceptions processes end, unless Congress acts to extend them.

For more information, view the Therapy Cap Fact Sheet [PDF] and the Manual Medical Review Process [PDF] or e-mail therapycapreview@cms.hhs.gov. Any new information from CMS will be available at ASHA’s Therapy Cap Exceptions Overview.
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August 2012
Volume 17, Issue 10