LCD L34049: Outpatient Physical and Occupational Therapy Services

Abstract

This Local Coverage Determination (LCD) describes the coverage limits of outpatient physical and occupational therapy services under Medicare Part B, billed to either the Medicare Part A MAC or Part B MAC when services are provided under a therapy plan of care. These limits include specific conditions under which certain physical and occupational therapy services may be considered covered by Medicare. This LCD shall not be construed to either expand or contract the limits of coverage imposed by the therapy cap as established by Medicare. This LCD shall not be construed to expand coverage to services defined as non-covered by National Coverage Determinations (NCDs).

Definitions

CLINICIAN refers to a physician, nonphysician practitioner (physician assistant, clinical nurse specialist and nurse practitioner) or a therapist (but not to an assistant, aide or any other personnel) providing a service within their scope of practice and consistent with state and local law. Clinicians make clinical judgments and are responsible for all services they are permitted to supervise. Services that require the skills of a therapist may be appropriately furnished by clinicians, that is, by or under the supervision of qualified physicians/NPPs when their scope of practice, state and local laws allow it and their personal professional training is sufficient to provide to the beneficiary skills equivalent to a therapist for that service.

QUALIFIED PROFESSIONAL means a physical therapist, occupational therapist, physician, or nonphysician practitioner (NPP) who is licensed or certified by the state to perform therapy services. Qualified professionals may also include physical therapist assistants (PTA) and occupational therapy assistants (OTA) when working under the supervision of a qualified therapist, within the scope of practice allowed by state law.

QUALIFIED AUXILIARY PERSONNEL means staff (auxiliary personnel) who have been educated and trained as therapists and qualify to furnish therapy services only under direct supervision incident to a physician or NPP. Qualified personnel may or may not be licensed as therapists but meet all of the requirements for therapists with the exception of licensure.

THERAPIST refers to physical therapists and occupational therapists qualified according to Medicare policy.

SKILLS OF A THERAPIST are defined by the scope of practice for therapists in the state. For clinicians who are not therapists (e.g., physicians and NPPs), personal professional training should be sufficient to provide to the beneficiary skills equivalent to a therapist (OT or PT) for that service. Skills of a therapist also include therapists supervising assistants.

PROVIDER refers to a facility or agency such as a rehabilitation agency, hospital, critical access hospitals (CAH), skilled nursing facilities (SNF), comprehensive outpatient rehabilitation facilities (CORF), home health agencies, or outpatient rehabilitation facilities (ORF).

SUPPLIERS of therapy services include individual practitioners such as physicians, NPPs, physical therapists and occupational therapists who have Medicare provider numbers.

Maintenance Program (MP) means a program established by a therapist that consists of activities and/or mechanisms that will assist a beneficiary in maximizing or maintaining the progress he or she has made during therapy or to prevent or slow further deterioration due to a disease or illness.

Medical Necessity

Section 1862(a)(1)(A) of the SSA states: “No Medicare payment shall be made for expenses incurred for items or services which . . . are not reasonable and necessary for the diagnosis or treatment of illness or injury or to improve the functioning of a malformed body member.”

Services which do not meet the requirements for covered therapy services in Medicare manuals are not payable using codes and descriptions as therapy services. For Example, services related to activities for the general good and welfare of patients, such as general exercises to promote overall fitness and flexibility, and activities to provide diversion or general motivation, do not constitute (covered) therapy services for Medicare purposes. Services related to recreational activities such as golf, tennis, running, etc., are also not covered as therapy services.

To be considered reasonable and necessary, the services must meet Medicare guidelines. The guidelines for coverage of outpatient therapies have basic requirements in common.

In the case of rehabilitative therapy, the patient’s condition has the potential to improve or is improving in response to therapy, maximum improvement is yet to be attained; and there is an expectation that the anticipated improvement is attainable in a reasonable and generally predictable period of time.

• Improvement is evidenced by successive objective measurements whenever possible. If an individual’s expected rehabilitation potential is insignificant in relation to the extent and duration of therapy services required to achieve such potential, rehabilitative therapy is not reasonable and necessary.

• Therapy is not required to effect improvement or restoration of function where a patient suffers a transient and easily reversible loss or reduction in function which could reasonably be expected to improve spontaneously as the patient gradually resumes normal activates (CMS Publication 100.02-, Medicare benefit Policy Manual, chapter 15, section 220.2©). For example, therapy may not be covered for a fully functional patient who developed temporary weakness from a brief period of bed rest following abdominal surgery. It is reasonably expected that as discomfort reduces and the patient gradually resumes daily activities, function will return without skilled therapy intervention.

In the case of maintenance therapy, treatment by the therapist is necessary to maintain, prevent or slow further deterioration of the patient’s functional status and the services cannot be safely carried out by the beneficiary him or herself, a family member, another caregiver, or unskilled personnel.

A therapy plan of care is developed either by the physician/NPP, or by the physical therapist who will provide the physical therapy services, or the occupational therapist who will provide the occupational therapy services, (only a physician may develop the plan of care in a CORF). The plan must be certified by a physician/NPP.

If the goal of the plan of care is to improve functioning, the documentation must establish that the patient needs the unique skills of a therapist to improve functioning.

If the goal of the plan of care is to maintain, prevent, or slow further deterioration of functional status function or prevent deterioration, the documentation must establish that the patient needs the unique skills of a therapist to maintain, prevent, or slow further deterioration of functional status

All services provided are to be specific and effective treatments for the patient’s condition according to accepted standards of medical practice; and the amount, frequency, and duration of the services must be reasonable.

The services that are provided must meet the description of skilled therapy below.

Skilled Therapy

A service is not considered a skilled therapy service merely because it is furnished by a therapist or by a therapist/therapy assistant under the direct or general supervision, as applicable, of a therapist. If a service can be self-administered or safely and effectively furnished by an unskilled person, without the direct or general supervision, as applicable, of a therapist, the service cannot be regarded as a skilled therapy service even though a therapist actually furnishes the service. Similarly, the unavailability of a competent person to provide a non-skilled service, notwithstanding the importance of the service to the patient, does not make it a skilled service when a therapist furnishes the service.

Skilled therapy services may be necessary to improve a patient’s current condition, to maintain the patient’s current condition, or to prevent or slow further deterioration of the patient’s condition.

Services that do not require the professional skills of a therapist to perform or supervise are not medically necessary. The skills of a therapist may also be furnished by an appropriately trained and experienced physician or NPP, or by an assistant (PTA, OTA) appropriately supervised by a therapist. Therefore, if a patient’s therapy can proceed safely and effectively through a home exercise program, self management program, restorative nursing program or caregiver assisted program, payment cannot be made for therapy services.

Consider the following points when determining if a service is skilled.

• Rehabilitative therapy occurs when the skills of a therapist (as defined by the scope of practice for therapists in each state) are necessary to safely and effectively furnish a recognized therapy service, whose goal is improvement of an impairment or functional limitation.

• The services shall be of such a level of complexity and sophistication or the condition of the patient shall be such that the services required can only be safely and effectively performed by a qualified clinician, or therapists supervising assistants.

• Maintenance therapy occurs when the skills of a therapist (as defined by the scope of practice for therapists in each state) are necessary to safely and effectively furnish a recognized therapy service, whose goal is to maintain functional status or prevent or slow further deterioration in functional status.

• If the specialized skill, knowledge, and judgement of a qualified therapist are required to establish or design a maintenance program to maintain the patient’s current condition or to prevent or slow further deterioration, the establishment or design of a maintenance program by a qualified therapist is covered.

• If skilled therapy services by a qualified therapist are needed to instruct the patient or appropriate caregiver regarding the maintenance program, such instruction is covered.

• If skilled therapy services are needed for periodic reevaluations or reassessments of the maintenance program, such periodic reevaluations or reassessments are covered.

• Such skilled care is necessary for the performance of a safe and effective maintenance program only when;

• The therapy procedures required to maintain the patient’s current function or to prevent or slow further deterioration are of such complexity and sophistication that the skills of a qualified therapist are required to furnish the therapy procedure or

• The particular patient’s special medical complications require the skills of a qualified therapist to furnish a therapy service required to maintain the patient’s current function or to prevent or slow further deterioration, even if the skills of a therapist are not ordinarily needed to perform such therapy procedure.

• Once a maintenance program is established, coverage of therapy services to carry out a maintenance program turns on the beneficiary’s need for skilled care. A maintenance program can generally be performed by the beneficiary alone or with the assistance of a family member, caregiver, or unskilled personnel. In such situations, coverage is not provided. However, skilled therapy services are covered when an individualized assessment of the patient’s clinical condition demonstrates that the specialized judgement, knowledge, and skills of a qualified therapist are necessary for the performance of safe and effective services in a maintenance program.

• While a beneficiary’s particular medical condition is a valid factor in deciding if skilled therapy services are needed, a beneficiary’s diagnosis or prognosis should never be the sole factor in deciding that a service is or is not skilled. The key issue is whether the skills of a qualified therapist are needed to treat the illness or injury, or whether the service(s) can be carried out by non-skilled personnel.

• If at any point in the treatment it is determined that the treatment becomes repetitive and does not require the unique skills of a therapist, the services are non-covered.

• There may be circumstances where the patient, with or without the assistance of an aide or other caregiver, does activities planned by a clinician. Although these activities may be supportive to the patient’s treatment, if they can be done by the patient, aides or other caregivers without the active participation of qualified professional/auxiliary personnel, they are considered unskilled.

• An individualized plan of exercise and activity for patients and their caregiver(s) may be developed by clinicians to maintain and enhance a patient’s progress during the course of skilled therapy, as well as after discharge from therapy services. Such programs are an integral part of therapy from the start of care and should be expected and modified as the patient progresses.

• If a patient’s limited ability to comprehend instructions, follow directions, or remember skills that are necessary to achieve an increase in function, is so severe as to make functional improvement very unlikely, rehabilitative therapy is not required, and therefore, is not covered. However, limited services in these circumstances may be covered with supportive documentation, if the skills of a therapist are required to establish and teach a caregiver a safety or maintenance program.

• This does not apply to the limited situations where rehabilitative therapy is reasonable and achieving meaningful goals is appropriate, even when a patient does not have the ability to comprehend instructions, follow directions or remember skills. Examples include sitting and standing balance activities that help a patient recover the ability to sit upright in a seat or wheel-chair, or safely transfer from the wheelchair to a toilet.

• This also does not apply to those patients who have the potential to recover abilities to remember or follow directions, and treatment may be aimed at rehabilitating these abilities, such as following a traumatic brain injury.

• The use of therapy equipment such as therapeutic pools or gym machines alone does not necessarily make the treatment skilled.

• Medicare does not cover packaged or predetermined therapy services or programs, such as Back Schools or pre-operative joint classes with preset educational activities and exercises for all participants involved. Services must be individualized, medically necessary and require the unique skills of a therapist. (Packaged or predetermined therapy services do not apply to post-surgical protocols that provide ranges and guidance.)

Personnel Authorized to Provide Outpatient Therapy Services

Medicare billable therapy services may be provided by any of the following within their scope of practice and consistent with state and local law:

• Physician;

• Non-physician practitioner (NPP) (physician assistants, nurse practitioners, clinical nurse specialists);

• Qualified physical and occupational therapists, speech language pathologists, and assistants working under the supervision of a qualified therapist;

• Qualified personnel, with or without a license to practice therapy, who have been educated and trained as therapists and qualify to furnish therapy services only under direct supervision incident to a physician or NPP.

The new personnel qualifications for physical therapists, physical therapist assistants, occupational therapists and occupational therapy assistants were discussed in the 2008 Physician Fee Schedule. See the Federal Register of November 27, 2007 for the full text. See also the correction notice for this rule, published in the Federal Register on January 15, 2008.

Personnel NOT Authorized to Provide Outpatient Therapy Services

Students*, aides, athletic trainers, exercise physiologists, massage therapists, recreation therapists, kinesiotherapists, low vision specialists, lymphedema specialists, Pilates instructors, rehabilitation technicians and life skills trainers are not considered qualified therapy professionals and may not bill their services under the Medicare therapy benefit, even if performed under the supervision of a qualified therapist.

* See Therapy Students section for further clarification regarding student participation in treatment.

CMS established the qualifications to assure that all personnel who provide therapy services are suitably trained in the discipline they practice. Personnel who do not meet the applicable professional standards to be considered qualified professional/personnel cannot furnish or be paid for physical or occupational therapy services.

Therapy Students

Qualified professionals may serve as clinical instructors for therapy students within their scope of practice. Physical therapist assistants and occupational therapy assistants may only serve as clinical instructors for physical therapist assistant students and occupational therapy assistant students, respectively, when performed under the direction and supervision of the licensed physical or occupational therapist (in states where licensure applies).

Services performed by a student (therapy student or therapy assistant student) are not reimbursed, even if provided under “line of sight” supervision of the therapist. However, the services of a qualified professional are covered, even when a student is participating in the care.

To be covered when the student is participating, the qualified professional must be present in the room and must:

• Direct the service, making the skilled judgment and assessment, and assume responsibility for the treatment;

• Not be engaged in treating another patient or doing other tasks at the same time (such as documentation); AND must

• Sign all documentation appropriately. A student may also sign the documentation, but it is not necessary since the Part B payment is for the qualified professional’s service, not for the student’s services.

Supervision Levels

Supervision levels for outpatient therapy services depend on the setting where they are provided. Direct supervision (in the office suite) by a physician/NPP is required for therapists and qualified auxiliary personnel when therapy services are provided incident to the services of a physician/NPP. Also, direct supervision by a physical therapist (for PTAs) or occupational therapist (for OTAs) is required when assistants provide therapy services in the private practice setting or in the office of a physician/NPP. General supervision (the supervising therapist is available but not necessarily on the premises) is required by a physical therapist (for PTAs) or occupational therapist (for OTAs) when therapy services are provided in any other setting.

Private Practice Therapy Services

All therapy medical necessity, certification, documentation and coding guidelines of this LCD apply to all outpatient settings, including therapy services provided by private practitioners. In addition, in the private practice setting, all services not performed by the therapist must be performed by an assistant who is an employee of the practice and must be under direct supervision of the therapist.

To qualify as a private practice, each individual must be enrolled as a private practitioner and employed in one of the following practice types:

• Unincorporated solo practice, partnership, or group practice;

• Physician/NPP group or groups that are not professional corporations, if allowed by state and local law;

• Physical or occupational therapist employed by physician/NPP group practices (PTPP, OTPP), if state and local law permits this employee relationship.

Private practice also includes therapists who are practicing therapy as employees of another supplier, of a professional corporation or other incorporated therapy practice. Private practice does not include individuals when they are working as employees of an institutional provider.

Services should be furnished in the therapist’s or group’s office or in the patient’s home. The office is defined as the location(s) where the practice is operated during the hours that the therapist engages in the practice at that location. If the services are furnished in a private practice office space, that space shall be owned, leased, or rented by the practice and used for the exclusive purpose of operating the practice.

Therapy Provided by Physicians and Physician Employees

Physical and occupational therapy services may be provided by physicians, non-physician practitioners (NPPs), or incident-to the services of physicians/NPPs when provided by physical or occupational therapists, in the office or home. All therapy medical necessity, certification, documentation, and coding guidelines of this LCD apply with one exception. When therapy services are performed incident-to a physician’s/NPP’s service, the therapist does not need a license to practice therapy, unless it is required by state law. All other physical or occupational therapist qualifications (education and training) must be met. Therapy services must be directly supervised. The services of PTAs and OTAs also may not be billed incident to a physician’s/NPP’s service. However, if a PT and PTA (or an OT and OTA) are both employed in a physician’s office, the services of the PTA, when directly supervised by the PT or the services of the OTA, when directly supervised by the OT may be billed by the physician group as PT or OT services using the PIN/NPI of the enrolled PT (or OT). (See Section 230.4 for private practice rules on billing services performed in a physician’s office.) If the PT or OT is not enrolled, Medicare shall not pay for the services of a PTA or OTA billed incident to the physician’s service, because they do not meet the qualification standards in 42CFR484.4.

Indications and Limitations of Coverage and/or Medical Necessity:

The following services are typically considered rehabilitative. This is not intended to be an exhaustive list of therapy services and does not assure coverage.

Therapy services should be provided in a manner that meets the patient’s needs. The treatment plan should strive to provide treatment in the most efficient and effective manner, balancing the best achievable outcome with the appropriate resources. Because medical review decisions are made based on documentation in the medical record, this LCD provides recommendations intended to assist qualified professionals/auxiliary personnel in documenting to support both the medical necessity and the skilled nature of the therapy services provided. In addition, any numerical guidelines related to individual codes in this section of the LCD, are based on contractor medical review experience. These are provided to remind qualified professionals/auxiliary personnel of the importance of justifying therapy services in the documentation as the patient progresses through an episode of care. The guidelines presented under the sections “Supportive Documentation Recommendations” are not mandated, and it is not necessary to document these recommended points for each treatment session (unless otherwise specified in the LCD).

Please refer to CMS publication 100-02, Medicare Benefit Policy Manual, Chapter 15, section 220.3 for the Medicare minimal documentation requirements for therapy services.

PT evaluation OT evaluation

The initial evaluation should document the necessity of a course of therapy through objective findings and subjective patient/caregiver self-reporting. Initial evaluations must be completed by the therapist or physician/NPP that will be providing the therapy services. Initial evaluations are completed to determine the medical necessity of initiating rehabilitative therapy or skilled instruction in maintenance activities that the patient and/or caregiver can perform at home.

Initial evaluation may be warranted when there is a change in functional ability. The evaluation should clearly describe the presenting complaint or problem for which the patient is seeking services of the physical or occupational therapist.

The evaluation process assesses, for example, the severity and impact of the current problem, the possibility of multi-site or multi-system involvement, the presence of pre-existing systemic conditions (e.g., diseases), and the stability of the condition. If the patient presents with multi-system involvement and/or multiple site involvement, all pertinent areas/conditions should be assessed at the initial evaluation (i.e., cervical pain and knee pain; low back pain and rotator cuff irritation; cervical pain and low back pain). Only one initial evaluation code should be used, and all presenting complaints and problems evaluated. If over the course of an episode of treatment, a new, unrelated diagnosis occurs, another initial evaluation may be covered.

Initial evaluations may be covered when the documentation justifies the need for a skilled therapy evaluation, even if it is determined that the patient does not require a skilled level of treatment.

• When an evaluation is the only service provided by a provider/supplier in an episode of treatment, the evaluation serves as the plan of care if it contains a diagnosis, or in states where a therapist may not diagnose, a description of the condition from which a diagnosis may be determined by the referring physician/NPP. The goal, frequency, and duration of treatment are implied in the diagnosis and one-time service. The referral/order of a physician/NPP is the certification that the evaluation is needed and the patient is under the care of a physician. Therefore, when evaluation is the only service, a referral/order and evaluation are the only required documentation. If the patient presented for evaluation without a referral or order and does not require treatment, a physician referral/order or certification of the evaluation is required for payment of the evaluation. A referral/order dated after the evaluation shall be interpreted as certification of the plan to evaluate the patient.

Screening may be more appropriate than evaluation in some circumstances. For example, a patient develops an acute lateral epicondylitis from painting. The patient seeks physician attention who subsequently recommends that the patient see an occupational therapist. By the time the patient sees the OT, she presents without any pain and has resumed all normal functional activities. Completing a screening interview of this patient should lead the therapist to determine that an OT evaluation and treatment would not be medically necessary.

• A screening is the gathering of information to determine the need for further evaluation by the clinician. The screening process may include a review of the patient’s medical record, a patient interview and observation of the patient.

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