Outpatient Therapy – The Biggest Secret of Home Health

November 14, 2012

MYTH:  If a patient is no longer homebound they must be discharged by home health.

FACT:  While it is true that the patient no longer qualifies for home health services when they stop being homebound, patients who still require skilled therapy services may continue to receive those services from an agency under the Outpatient Therapy benefit.

Outpatient Therapy is not a part of the home health benefit.  In fact, patients cannot receive Outpatient Therapy while under a home health plan of care.  It is considered a part of the bundled services covered under consolidated billing.

Patients receiving Outpatient Therapy must have Medicare Part B coverage.  The services provided should follow Medicare guidelines for delivery of care as noted in the Local Coverage Determinations (LCDs) for each therapy discipline.  The patient must be under the care of a physician and a written Plan of Treatment must be developed by the physician, a non-physician practitioner, or qualified therapist and signed by the physician or non-physician practitioner.  Unlike traditional home health, this Plan of Treatment covers a 90-day span.

Home health agencies can bill Medicare for Outpatient Therapy services.  They would do so using a type of bill 34X and would bill by the CPT code for procedures provided to the patient using a modifier GP for PT, GO for OT or GN for ST.  The home health agency will submit the bill under Part A and the reimbursement would come from the patient’s Part B coverage.  This means that the agency can expect to be reimbursed for 80% of the allowable amount with the remaining 20% coming from supplemental insurance or the patient.

Another limitation to be mindful of is the Outpatient Therapy cap for therapy services.  In 2012 it was $1880 for combined PT and ST visits and $1880 for OT visits.  It appears that this cap will be increased for 2013 but the cap will also include Outpatient Therapy services provided in the hospital setting which was not previously considered as a part of the cap.  There are also exceptions to the cap with prior approval.

For more information, please see the following sources:

General information: Medicare Learning Network’s Medicare Outpatient Therapy Billing booklet by CMS

Regulations, covered CPT codes, covered ICD-9 codes: Local Coverage Determinations (LCDs) for PT, OT, ST found on Palmetto GBAs website – under J11 MAC Home Health & Hospice – Medical Policies – LCDs & NCDs

Therapy Caps & Prior Authorization: The Palmetto GBA Outpatient Therapy Services Caps and Thresholds Home Health Job Aid

Therapy Caps & Prior Authorization: CMS MLN Matters #MM8036 and #MM7785

Physician Fee Schedule