"Physical therapy is not a subspecialty of the medical profession and physical therapists are not medical doctors; we are a separate profession that provides a unique service that physicians are unable and untrained to provide."

Letter to the AMA from the APTA, Dec 2009

Wednesday, August 11, 2010

Physical Therapist´s Payment Option # 1

Three new poposed payment options related to the Medicare Physician Fee Schedule were published in the June 25th Federal Register and are available for public comment until August 24th.

The immediate concern is the proposed Multiple Procedure Payment Reduction (MPPR) policy but there are additional concerns that deserve physical therapists´ attention. I´d like to review the alternative payment options:
  • Option #1
  • Option #2 and
  • Option #3
...and make recommendations for or against. As always, your comments are welcome on this blog. Also, please use the link provided to make public comments on the proposed MPPR policy directly to your government.

Note that CMS is not specifically recommending these alternative payment policies, at this time.

Option #1: New Severity and Function codes

The Centers for Medicare Services (CMS) would require physical therapists to replace the -KX modifier with new HCPCS Level 2 codes at Evaluation and Progress Note intervals (30 days or 10 visits, whichever is less).

PT Test or MeasureFunction CodesCode Description
Impaired Step Down TestGxxxUBody Function/Body Structure impairment - current
Impaired Step Down TestGxxxVBody Function/Body Structure impairment - goal
Slow Stair Measure Test (9 steps)GxxxWActivity Limitation/Participation Restriction - current
Slow Stair Measure Test (9 steps)GxxxXActivity Limitation/Participation Restriction - goal
3 steps into homeGxxxYEnvironmental Barrier - current
3 steps into homeGxxxZEnvironmental Barrier - goal

note: I have added the PT Tests and Measures to show how these codes might be supported by evidence-based data in the patient chart.

Two severity modifiers have been proposed. This first chart shows modifiers based on the ICF:

Severity ModifierDescriptor

This second chart shows modifiers for impairments, limitations and/or barriers as simple percentages:

Severity Modifier
1 to 19%
20 to 39%
40 to 59%
60 to79%
80 to 99%

Benefit: The policymakers are using International Classification of Function (ICF) descriptors to link physical impairments to function in a way that can be analyzed through claims reporting.

This option explicitly defines patient progress by comparing current and expected (goal) function.

CMS believes this option will lead to a decreased reporting burden because the -KX modifier would not be need on each claim line for patients over or near the PT caps.  Instead, only the new severity and function codes would be reported at (re)evaluation and Progress Note intervals.

These codes would also provide more information for medical review - at this time medical review (Medicare Audit) is a highly variable process that imposes provider liability based on largely pen-and-paper scribbled, narrative notes.

Risk: Physical Therapists in Private Practice (PTPPS), hospitals outpatient departments (Part B) and other settings may not routinely assess firsthand patient environmental barriers, especially those in the patient´s home.

Also, the link between physical impairment (body structure and function) and functional limitations (Activity and Participation Limitations) is tenuous and poorly described in the PT literature.

If such a link does exist it is probably NOT the linear, staight line conceptualized by Nagi in 1965 or the ICFDH in 1981.

This new coding scheme seems to hold physical therapists accountable for a conceptualized framework that is popular to academics and policymakers but is often absent from clinical realities.

Time Frame: Six months to two years.

My Call: I like this option because it gives physical therapists the chance (for the first time) to send claims-level data to CMS about the quality of physical therapy. 

This option may protect physical therapists from the Medicare Auditors´ concept of "skilled physical therapy" as a reason to deny claims.


  1. I like this option as well, but who would define what the impairment of body structure/function and activity limitation measures where?

    Could we define/defend with a 6 minute walk, TUG, or 5 times sit to stand test OR would CMS be choosing which measures HAD to be used?

    If we can pick appropriate measures with good data and prognostic/predictive utility then I really like this option...

  2. Kyle,

    Great question. I can see where Medicare auditors might use the ambiguity inherent in these proposed rules to deny claims based on their arbitrary and outdated notions of "skilled physical therapy".

    If you chose 6min. walk test, TUG, 5x STS we should be able to use these standardized, evidence-based tests as sufficient criteria for Medicare payment.

    Physical therapists should be insulated from a Medicare audit based on these criteria initially and significant progress ultimately.

    The Medicare Payment Advisory Commission(MedPAC) has proposed Coverage with Evidence Development (CED) in it´s June 2010 Report to the Congress.

    "Coverage with evidence development (CED) is an approach for health care payers to pay for potentially beneficial medical services that lack clear evidence showing their clinical effectiveness in specific patient populations.
    Some services diffuse quickly into routine medical care with incomplete information about their clinical effectiveness.
    Under CED, patients have access to medical services while clinical evidence is being collected and analyzed.
    CED’s goal is to reconcile the tension between evidence-based policies and being responsive to the pressure from product developers, providers, and patients to cover new services and new indications of existing services."

    CED seems primarily to be for new products or unproven therapies.

    Human trials in physical therapy are difficult and expensive while the potential benefit of large data sets might show better effectiveness than drugs or surgery for preventing disability and institutionalization.

    Thanks for your insight,



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Tim Richardson, PT owns a private practice at Medical Arts Rehabilitation, Inc in Palmetto, Florida. The clinic website is at MedicalArtsRehab.com.

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