Medicare Cap and Payment Reductions for 2014
MEDICARE THERAPY CAP FOR 2014
On December 26, 2013, President Obama signed into law the Pathway for SGR Reform Act of 2013. This new law prevents a scheduled payment reduction for physicians and other practitioners who treat Medicare patients from taking effect on January 1, 2014.
The new law also extends several provisions of the Middle Class Tax Relief and Job Creation Act of 2012 (Job Creation Act) as well as provisions of the Affordable Care Act. Specifically, the following Medicare fee-for-service policies have been extended.
Section 1103 -Extension Related to Payments for Medicare Outpatient Therapy Services -Section 1103 extends the exceptions process for outpatient therapy caps through March 31, 2014.
Providers of outpatient therapy services are required to submit the KX modifier on their therapy claims, when an exception to the cap is requested for medically necessary services furnished through March 31, 2014.
In addition, the new law extends the application of the cap and threshold to therapy services furnished in a hospital outpatient department (OPD).
All Medicare beneficiaries began a new cap for outpatient therapy services received on January 1, 2014. For physical therapy and speech language pathology services combined, the 2014 limit for a beneficiary on incurred expenses is $1,920. There is a separate cap for occupational therapy services which is $1,920 for 2014. Deductible and coinsurance amounts applied to therapy services count toward the amount accrued before a cap is reached, and also apply for services above the cap where the KX modifier is used.
Section 1103 also extends the mandate that Medicare perform manual medical review of therapy services furnished January 1, 2014 through March 31, 2014, for which an exception was requested when the beneficiary has reached a dollar aggregate threshold amount of $3,700 for therapy services, including OPD therapy services, for a year. There are two separate $3,700 aggregate annual thresholds: (1) physical therapy and speech-language pathology services, and (2) occupational therapy services.
Please note that these provisions do not reflect all of the Medicare provisions in the new law, and more information about other provisions will be forthcoming. The Genco team will continue to monitor this situation and share this information with our clients as it becomes available.
Genco Healthcare helps practices achieve and maintain a culture of compliance. We also assist Healthcare Attorneys in defending their clients who have been audited or subject to pre payment review. Consequently, we have our finger on the pulse of precisely what Medicare’s expectations are when it comes to medical documentation.
Thanks for the update.