Therapy Cap in 2018 – No Fluff, Just What You Need To Know

Author: Paul Singh

Click Here to read the most recent update!

  • For physical and speech therapy combined, the therapy cap is $2,010.
  • For occupational therapy, the therapy cap is $2,010.
  • The exceptions process (appendage of the KX modifier) allowing payment above
    this cap expires on December 31, 2017.
  • Without extension, any treatment above $2,010 will be the beneficiary’s
  • However, the exceptions process has been continuously extended several times
    through legislation. This is typically done at the last hour.
  • If the exceptions process is extended, Medicare will reimburse for services above
    the $2,010 cap by appending the KX modifier indicating that treatment is
    medically necessary.

In addition to the above uncertainty as of today’s date, there is also another pending
proposal attempting to completely repeal the Medicare cap. The details of this proposal
lower the threshold for medical manual review from $3,700 to $3,000 but also would
eliminate the cap outlined above and only require KX modifiers to be appended to claims
for therapy services over $3,000.

So over the course of the next two weeks, there are still many things to be determined. If
we had to guess, we would predict that the cap will remain at $2,010 and the exceptions
process will be extended to allow the use of the KX modifier.

As soon as we know more, we will most certainly share with you all.

Update as of December 26th

Congress has recessed for their holiday break without extending or repealing the therapy cap.  As of current, the KX modifier is not an available option and there is a hard cap of $2,010 on therapy claims.  However, Congress will reconvene mid-January and and at that point may extend or completely repeal the therapy cap.

Update as of January 24, 2018

As of today’s date, the therapy cap exceptions process has not been extended. Medicare will not pay claims above the $2,010 threshold regardless of whether a KX modifier has been appended. However, because this legislation is still in “limbo” it is important that you currently do not bill the patient for this amount as there is a good chance that Medicare will end up paying these claims. Any claims that are above the cap and submitted with a KX modifier will be held by CMS for a reasonable time to determine how legislation is going to shake out. Any claims that are above the cap and are not submitted with a KX modifier will be denied by CMS. In summary, there is still a hard cap on therapy with no exceptions process and Medicare will hold claims containing a KX until a decision is made in Washington, DC. Stay tuned.

Update as of January 30th, 2018

Claims treated above the therapy cap and submitted to Medicare with a KX modifier will now only be held for 20 days and then be released as denials.  At this point, if your patient is approaching the cap, it is important to issue them an ABN form so that they understand that there is a chance that they may be liable for treatment if the therapy cap exceptions process is not reinstated.

Per the CMS website, “Starting January 25, 2018, CMS will immediately release for processing held therapy claims with the KX modifier with dates of receipt beginning from January 1-10, 2018. Then, starting January 31, 2018, CMS will release for processing the held claims one day at a time based on the date the claim was received, i.e., on a first-in, first-out basis. At the same time, CMS will hold all newly received therapy claims with the KX modifier and implement a “rolling hold” of 20 days of claims to help minimize the number of claims requiring reprocessing and minimize the impact on beneficiaries if legislation regarding therapy caps is enacted. For example, on January 31, 2018, CMS will hold all therapy claims with the KX modifier received that day and release for processing the held claims received on January 11. Similarly, on February 1, CMS will hold all therapy claims with the KX modifier received that day and release for processing the held claims received on January 12, and so on.”

Update as of February 11th, 2018

  1. The therapy cap has been repealed which will prevent the therapy industry from holding their breath at the end of each year waiting on legislation to allow the exceptions process. Patients do not need to be fearful that the financial responsibility will fall to them if they receive therapy services that exceed the cap. This is a huge win for Medicare beneficiaries.
  2. The 2018 therapy cap for physical therapy is $2,010. Physical, occupational and speech therapy services can be rendered above this threshold and will be paid for by Medicare if a KX modifier is included on the claim.
  3. The medical manual review threshold has been lowered from $3,700 to $3,000.  Services rendered above the $3,000 threshold may trigger a manual medical review for providers who are flagged for meeting certain indicators such as high denial rates and billing outliers in comparison to their colleagues.

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