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Medicare Part B Deadline

Wed., April 1, 2015, is the deadline by which the Medicare Part B payment extender as authorized in the Pathway for SGR Reform Act of 2013 expires, including the override of Medicare Part B rate reductions and the therapy caps exceptions process. Most critical is the scheduled 21.2 percent reduction in Part B rates unless Congress takes affirmative action. Specifically, the following provisions of the law are due to expire:

  • section 101 of the law overrides the previously announced 20.1 percent reduction in Medicare Part B rates for 2014 and substituted an overall 0.5 percent increase in the MPFS for the period of Jan. 1, 2014 through Tues., March 31, 2015;
  • section 103 extends the therapy caps exceptions process and application of the KX modifier through March 31, 2015 (for the CMS therapy caps and the exceptions process website, please click here); and
  • by extending certain provisions of the American Taxpayer Relief Act of 2012, section 103 also extends the mandate that Medicare perform manual medical review of therapy services for the same period of Jan. 1, 2014 through March 31, 2015. This review applies when the exceptions process is triggered and the beneficiary has reached a dollar aggregate threshold amount of $3,700, including hospital outpatient department therapy services. The two separate $3,700 aggregate annual thresholds remain unchanged: (1) physical therapy and speech-language pathology services combined and (2) a separate threshold for occupational therapy services.

This legislation essentially allowed for 2014 rates to continue through the first quarter of 2015. LeadingAge NY provided members with extensive details on these issues, including a comprehensive analysis of the calendar year 2015 Medicare Physician Fee Schedule (MPFS) Final Rule programmatic and a rate issues. For complete details please click here.

For our members who attended the LeadingAge National PEAK Conference last week, these were the critical Medicare payment issues for our advocacy on Capitol Hill. In addition, we also advocated on the issue of beneficiaries losing access to Medicare Part A coverage due to the increasing use of “observation stays” in the hospital.

Members are advised that for several years now CMS has been mandated to publish initial Medicare Part B rates that include a significant reduction based on the current Sustainable Growth Rate formula (SGR). Policy and lawmakers generally acknowledge that the SGR methodology is flawed and Congress has always intervened to override the otherwise negative rate adjustments of the past few years. Our sense at this time is that Congress wants to address what is generally referred to as the "doc fix." It is unclear, however, as to what form the doc fix will take and how the timing will work out. 

As a reminder, there have been several years in which we have faced similar MPFS cuts and the deadline has actually expired, leaving Congress with having to retroactively adjust rates. In these instances, we have seen where the Medicare Administrative Contractor even went so far as to not update their rate schedules pending anticipated Congressional action and providers have been advised to hold claims. There is the possibility that we may face a similar circumstance with the current April 1 deadline.

Therapy Caps Reminder

The Medicare Part B outpatient therapy cap for Occupational Therapy (OT) is $1,940 for 2015, and the combined cap for Physical Therapy (PT) and Speech-Language Pathology Services (SLP) is $1,940 for 2015. This is an annual per beneficiary therapy cap amount determined for each calendar year. Exceptions to the therapy cap are allowed for reasonable and necessary therapy services. The therapy caps are effective on a calendar year basis, so these new amounts are effective Jan. 1, 2015. For more details, please see MLN Matters article MM8970.

Advocacy Needed

Congressional action is expected this week on the issue. It is important for providers to watch for further developments in terms of a Congressional override of the currently scheduled 21.2 percent reduction in rates effective April 1, 2015. LeadingAge is asking Congress to act to avert a major reduction in rates. LeadingAge NY will be keeping member informed regarding further developments.

Contact: Patrick Cucinelli, pcucinelli@leadingageny.org, 518-867-8827