01-044 Therapy Reviews Notification of Medical Review

Noridian Healthcare Solutions, LLC, as the Supplemental Medical Review Contractor (SMRC) for the CMS, is conducting post-payment review of Medicare outpatient therapy claims billed on dates of service from January 1, 2018 through December 31, 2018. This notification includes the reasons for the review, documentation that will be requested in the Additional Documentation Request (ADR) letter, and resources providers/suppliers may wish to consult when submitting claims.

Background

A series of Medicare laws defined payment rules for physical therapy (PT), occupational therapy (OT) and speech-language pathology (SLP). Beginning in 2015, the Medicare Access and Children’s Health Insurance Program (CHIP) Reauthorization Act (MACRA) was amended allowing providers to apply for exceptions to the PT, OT and SLP legal limits on behalf of beneficiaries. MACRA also repealed the mandatory manual review requirement and instead required that claims submitted after a beneficiary’s claims reach a specified total in excess of the cap, be subject to targeted medical review described in the Social Security Act (SSA) §1833 (g)(5)(E). For PT, OT and SLP furnished between October 1, 2012 and December 31, 2017, a provider could request an exception from the expense threshold, which was $3,700.

In January 2018, The Bipartisan Budget Act (BBA) of 2018 amended Section 1833(g) of the SSA by repealing the Medicare expense threshold for therapy services and creating limitations to ensure appropriate therapy services are furnished. The BBA of 2018 is applicable for PT, OT, and SLP services furnished after January 1, 2018. For calendar year 2018, the medical review (MR) threshold is $3,000 for PT and SLP services combined and $3,000 for OT services. When PT/SLP or OT services for a beneficiary exceed $3000, subsequent claims are subject to targeted medical review as described in SSA §1833(g)(5)(E).

The prior SMRC conducted a Specialty MR study to identify payments for PT, OT and SLP services furnished by a physician or incident to a physician’s services that were in excess of legal limits established by MACRA. The prior SMRC found improper payments for such claims continued to be a matter of concern.

Reason for Review

CMS tasked Noridian, as the SMRC, to perform data analysis and conduct medical review on outpatient therapy claims. Noridian will complete medical review on a sample of claims related to outpatient rehabilitation services. The SMRC will conduct reviews in accordance with applicable statutory, regulatory, and sub-regulatory guidance.

Claim Sample Detail

Type of Bill (TOB) Revenue Codes
  • 13x: Outpatient Hospital
  • 22x: Inpatient SNF Part B
  • 23x: Outpatient SNF
  • 74x: Outpatient Physical Therapy Providers
  • 0420: Physical Therapy Services
  • 0430: Occupational Therapy Services
  • 0440: Speech Language Pathology Services

Access related project details below.

Documentation Requirements

Below is a list of specific documentation requirements that will be included in each ADR to obtain the necessary documentation to perform the review. Documentation requested has been made specific to assist the provider in collecting and submitting pertinent information to decrease provider burden.

  1. Physician/Non-Physician (NPP) order or evidence of intent to order
  2. History and Physical reports (include medical history and current list of medications)
  3. Documentation to support National Coverage Determination (NCD), Local Coverage Determination (LCD) and/or Policy Article
  4. Initial evaluation/re-evaluation signed by ordering physician or practitioner
  5. Signed and dated overall plan of care including, short and long term goals with any updates to the plan of care
  6. Progress reports written by the clinician – services related to progress reports are to be furnished on or before every 10th treatment day
  7. PT/OT/SLP – Initial evaluation, plan of care, progress reports, treatment encounter notes, therapy minute logs, and discharge summary
  8. Specific Skilled Procedures and Modalities
  9. Records of Aide Visits, Times and Dates
  10. Physician/Non-Physician Practitioner (NPP) certification of Plan of Care for Claim Period Including Justification when the Certification is Delayed More than 30 Days
  11. List of all personnel billing services under your NPI. List credentialing, training, licensure, etc., of all personnel
  12. Signature log or signature attestation for any missing or illegible signatures within the medical record (all personnel providing services)
  13. Advance Beneficiary Notice of Non-Coverage (ABN)/Notice of Medicare Non-Coverage (NOMNC)

References/Resources

  • Social Security Act (SSA) Title XVIII, Section Payment to Provider of Services
  • SSA Title XVIII, Section 1833(e). Payment of Benefits
  • SSA Title XVIII, Section 1833(g)(7)(A) and 1833(7)(B)(ii). Payment of Benefits
  • SSA Title XVIII, Section 1833(g)(5)(E). Payment of Benefits
  • SSA Title XVIII, Section 1835(2) (C, D, E). Procedure For Payment of Claims of Providers of Services
  • SSA Title XVIII, Section 1861(g). Outpatient Occupational Therapy Services
  • SSA Title XVIII, Section 1861(p). Outpatient Physical Therapy Services
  • SSA Title XVIII, Section 1861(s)(2)(D). Medical And Other Health Services
  • SSA Title XVIII, Section 1862(a)(1)(A). Reasonable and Necessary
  • SSA Title XVIII, Section 1862(a)(20). Exclusions from Coverage and Medicare as Secondary Payer
  • SSA Title XVIII, Section 1879(a)(1). Limitation on Liability of Beneficiary where Medicare Claims are Disallowed
  • Balance Budget Act (BBA) 2018, Division E, Title II, Section 50202 Repeal of Medicare payment cap for therapy services; limitation to ensure appropriate therapy
  • 42 Code of Federal Regulations (CFR) §409.17. Physical Therapy, Occupational Therapy, and Speech-Language Pathology Services
  • 42 C.F.R. §409.32. Criteria for Skilled Services and the Need for Skilled Services
  • 42 C.F.R. §59. Outpatient Occupational Therapy Services: Conditions
  • 42 C.F.R.§410.60. Outpatient Physical Therapy Services: Conditions
  • 42 C.F.R. §410.61. Plan of Treatment Requirements for Outpatient Rehabilitation Services
  • 42 C.F.R. §410.62. Outpatient Speech-Language Pathology Services: Conditions and Exclusions
  • 42 C.F.R. §424.24. Requirements for Medical and Other Health Services Furnished by Providers Under Medicare Part B
  • CMS Internet Only Manual (IOM), Publication 100-02, Chapter 12, Section 40.2. Physical Therapy Services
  • CMS IOM, Publication 100-02, Chapter 12, Section 40.3. Occupational Therapy, Services
  • CMS IOM, Publication 100-02, Chapter 12, Section 40.4. Speech-Language Pathology Services
  • CMS IOM, Publication 100-02, Chapter 15, Section 220. Coverage of Outpatient Rehabilitation Therapy Services (Physical Therapy, Occupational Therapy, and Speech-Language Pathology Services) Under Medical Insurance
  • CMS IOM, Publication 100-02, Chapter 15, Section 230. Practice of Physical Therapy, Occupational Therapy, and Speech-Language Pathology
  • CMS IOM, Publication 100-02, Chapter 16, Section 20. Services Not Reasonable and Necessary
  • CMS IOM, Publication 100-02, Chapter 16, Section 110. Custodial Care
  • CMS IOM, Publication 100-3, Chapter 1, Part 3, Section 170.3 Speech-Language Pathology Services for the Treatment of Dysphagia. Effective October 1, 2006
  • CMS IOM, Publication 100-04, Chapter 5, Section 20. HCPCS Coding Requirement
  • CMS IOM, Publication 100-04, Chapter 5, Section 40. Special Claims Processing Rules for Institutional Outpatient Rehabilitation Claims
  • CMS IOM, Publication 100-08, Chapter 3, Section 3.3.2.7. Review Guidelines for Therapy Services
  • CMS IOM, Publication 100-08, Chapter 13, Section 13.5.4. Reasonable and Necessary Provisions in an LCD
  • Local Coverage Determination (LCD) L34049 Outpatient Physical and Occupational Therapy Services. Effective October 1, 2015
  • LCD L33631 Outpatient Physical and Occupational Therapy Services. Effective October 1, 2015
  • LCD L34427 Outpatient Occupational Therapy. Effective October 1, 2015
  • LCD L34428 Outpatient Physical Therapy. Effective October 1, 2015
  • LCD L34429 Outpatient Speech Language Pathology. Effective October 1, 2015
  • LCD L33580 Speech Language Pathology. Effective October 1, 2015
  • LCD L34043 Dysphagia/Swallowing Diagnosis and Therapy. Effective October 1, 2015
  • LCD L34046 Speech Language Pathology. Effective October 1, 2015
  • LCD L35036 Therapy and Rehabilitation Services (PT, OT). Effective October 1, 2015
  • LCD L35070 Speech – Language Pathology (SLP) Services: Communication Disorders. Effective October 1, 2015
  • Local Coverage Article (LCA) A52773: Billing and Coding: Therapy Evaluation, Re-Evaluation and Formal Testing. Effective October 1, 2015
  • LCA A52775: Billing and Coding: Medical Necessity of Therapy Services. Effective October 1, 2015
  • LCA A52776: Billing and Coding: Therapy Students and Aides. Effective October 1, 2015
  • LCA A53064: Billing and Coding: Outpatient Occupational Therapy. Effective October 1, 2015
  • LCA A53065: Billing and Coding: Outpatient Physical Therapy. Effective October 1, 2015
  • LCA A53304: Billing and Coding: Medical Necessity of Therapy Services. October 1, 2015
  • LCA A53339: Billing and Coding: Therapy Students and Aides. Effective October 1, 2015
  • LCA A54111: Billing and Coding: Speech Language Pathology (SLP) Services: Communication Disorders. Effective October 1, 2015
  • LCA A57675: Billing and Coding: Dysphagia/Swallowing Diagnosis and Therapy. Effective October 1, 2015

Last Updated Apr 8, 2021