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A couple of weeks ago I wrote a column discussing the Medicare Therapy caps for rehabilitation services and what it meant to Medicare participants. I wanted to follow-up and share the good news and the “not so good news.”

 First lets clarify the difference between Medicare Part A and B. Medicare Part A covers hospital stays, skilled nursing care, hospice and home heath services. Part B covers outpatient care, preventative services, ambulance services and durable medical equipment.

 The good news is that on Feb 9th Congress passed a $500 billion bipartisan budget deal to fund the US government through March 23, 2018. Included in this budget deal was a permanent solution to the hard therapy cap.

 What does this mean for Medicare recipient?

 In 2017, Medicare Part B payed $1980 annually for physical and speech therapy services combined. In 2017 there was a way to add a modifier to continue to bill Medicare for services. It was required that the services were deemed medically necessary. This was called the exceptions process. In early 2018 there was “no” exceptions process as the therapy cap had expired. Now with the new legislation, the amount paid for therapy services has been increased to $2010 for each  - meaning physical and occupational therapy services will each have a $2010 limit. The legislation also permanently fixed the system so that there would always be a way to bill for medically necessary outpatient services (Medicare Part B).

 When would you need these services? Strokes, hip fractures, arthritis, Parkinson’s disease and total joint replacement conditions (just to name a few) typically require extensive therapy for patients to learn how to speak, feed themselves, walk, and manage the tasks of everyday living.

 Now we can’t provide therapy forever. The legislation created a limit on services. Previously the limit was $3700. The limit has been lowered to $3000. If you reach $3000 in therapy services an additional medical review may be required. The limit doesn’t necessarily mean that Medicare “won’t” pay any additional money, it just means that they will review the case.

 The “not so good news.”

 The bad news is that Congress chose to offset the cost of the permanent therapy cap fix (estimated at $6.47 billion) by adding a last-minute addition of a payment differential. Beginning in 2022, physical therapist assistants (PTAs) and certified occupational therapy assistants (COTAs) payment for services will be reduced by 15 percent. These are licensed physical and occupational therapist extenders similar to the role physician assistants (PA) and nurse practitioners (NP) fill in providing services. A 15 percent cut in reimbursement will make it even more difficult for outpatient clinics to continue to be viable and provide quality services.

 There are many changes that are occurring with Medicare and the general reimbursement from insurance companies. It is becoming more difficult for private outpatient clinics to keep their doors open. Most patients receiving physical therapy services don’t realize that the provider is likely to only receive 40 percent or less reimbursement.

 Changes to Medicare typically trickles down to other insurances. If this happens, outpatient clinics will receive less reimbursement for providing care with licensed assistants. Clinics may be required to choose not to hire licensed assistants and replace these extenders with unlicensed personnel in order to remain a viable business.

 I don’t know when or how we will find solutions to our health care issues. I am concerned that as reimbursements continue to decrease that we will be required to see more volume of patients with fewer licensed staff. I believe everyone deserves to reach their full potential after an injury, a stroke, or due to a disease process or a fracture. We must stay alert and active in knowing about these small changes that are taking away our opportunity to return to the highest possible level of movement or function.


Dr. Maria Fermoile is a Doctor of Physical Therapy at Alliance Health in Fresno. She will be happy to answer questions submitted to Learn more about movement, fitness and health in this space each week, on our Facebook page, by going to, or calling 478-5833.

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