Statement of American Physical Therapy Association, Alexandria, Virginia

Madam Chairwoman and members of the Subcommittee, the American Physical Therapy Association (APTA) is pleased to provide written comment for your consideration regarding the important task of reforming the Medicare program. APTA sincerely appreciates your efforts this Congress to explore this issue in greater detail and hold necessary hearings to ensure all views are heard on the matter.

Tommy Thompson, the newly appointed Secretary of Health and Human Services, summarized the feelings of the physical therapy community in a speech given to the American Association of Health Plans on February 26, 2001. The former governor of Wisconsin stated, "Patients and providers alike are fed up with excessive and complex paperwork. Rules are constantly changing. Complexity is overloading the system, criminalizing honest mistakes and driving doctors, nurses and other health care professionals out of the program."

There are a number of regulations that are unnecessary and take away vital time and resources from patient care. These regulations impact physical therapists working in a variety of settings, which include: hospitals, skilled nursing, facilities, home health agencies, comprehensive outpatient rehabilitation facilities, rehabilitation agencies, and physical therapy private practice offices. If necessary deregulation can take place, physical therapists will be able to provide care to Medicare patients in these settings in a more timely manner, which will speed recovery.

The following are problematic regulations and policies under the Medicare program that impact physical therapy. APTA has notified HCFA that these regulations and policies need to be eliminated, revised, or clarified. In most cases, we are still awaiting action.

Certification/ Recertification

Section 1861 (p) of the Social Security Act requires that outpatient physical therapy, occupational therapy, or speech-language pathology services be furnished only to an individual who is under the care of a physician. According to Medicare regulations, for outpatient physical therapy services furnished in rehabilitation agencies, physical therapist private practice offices, outpatient hospital departments, and skilled nursing facilities (Part B), there must be evidence in the patient's clinical record that he or she has been seen by the physician every 30 days. In addition, the clinical record must show that the physician reviewed the plan of care and recertified the need for that care every 30 days. For home health agencies and comprehensive outpatient rehabilitation facilities, the physician is required to review the plan of care and recertify the need for care every 62 days.

The need for a physician visit every 30 days is problematic. In many instances, it takes a week or two before the patient goes to receive his or her outpatient physical therapy treatment. After receiving two weeks of treatment, the 30 days expires, and the patient then needs to see the physician again in order to continue treatment. Returning to the physician's office in this time frame is an inconvenience to the patient and the physician. It is particularly problematic in rural areas, where the patient may have to travel a long distance to get to a physician's office.

Physician signature on plan of treatment

Medicare requires that the physician recertify the need for therapy services every 30 days. Because this policy is not written clearly in HCFA's manuals, there is considerable confusion with respect to when the 30-day time frame begins and at what point the physician signature has to be on the plan of care. It is not clear whether the 30-day time frame begins after the physical therapist conducts an evaluation, after the initial physician visit, or when the physical therapy treatment actually begins. It is also not clear whether the physician signature has to be on the plan of treatment before therapy begins, before the claim is submitted to Medicare, or shortly after therapy begins.

APTA has tried unsuccessfully to obtain clarification from HCFA on these issues. Because there has been no clarification, carriers and fiscal intermediaries throughout the country are interpreting this provision differently. APTA's recommends that the 30-day time frame begin when the therapist sees the patient, and that the physician signature be on the plan before the claim is submitted to Medicare. Because it can often be difficult to obtain physician signatures, requiring the signature before treatment begins would result in delays in needed patient care.

Home Health Agency Prospective Payment System and Medicare Part B

On October 1, 2000, HCFA implemented the Medicare home health agency (HHA) prospective payment system (PPS). The HHA PPS includes a consolidated billing requirement, which mandates that home health agencies must bill and receive payment for all home health services, including physical therapy services, during a 60-day episode of care. Once the patient is discharged from the home health plan of care and is no longer eligible for the home health benefit, an outpatient rehabilitation provider may treat and bill for the services under Medicare Part B.

Since the inception of the HHA PPS, physical therapists have had numerous problems receiving payment under Medicare Part B for services provided to patients recently discharged from a home health plan of care. This is due to the fact that HCFA is unable to track patient discharges until final payment claims have been submitted by the HHA. As a result, the carriers and intermediaries are rejecting Part B claims because the computer edits flag the file as being open under the Part A HHA PPS.

At a meeting with APTA, HCFA staff indicated that there is no immediate solution to this problem. Therefore, APTA respectfully requests that the home health consolidated billing provision be suspended until this computer problem can be corrected. It is unfair to penalize providers because HCFA does not have the adequate resources to operationally implement the consolidated billing policy.

"In Room" Supervision Requirement of Physical Therapist Assistants in Physical Therapist Private Practice Offices

HCFA's final rule, published in the November 2, 1998 Federal Register, HCFA required that a licensed physical therapist in private practice (PTPP) must personally supervise the physical therapist assistants and physical therapy aides. HCFA defines personal supervision to mean the physical therapist must be in the room during the performance of the service. Prior to that date, the standard for supervision was "direct supervision." In our view, the "in the room" supervision requirement is too strict and unnecessary. PTAs are state regulated practitioners, who can safely and effectively furnish therapy services under a less stringent supervision standard. The personal supervision requirement imposes a level of supervision higher than that required for PTAs furnishing services in other Medicare settings.

APTA has provided written opposition to the "in-the-room" requirement in its comments on the Medicare physician fee schedule for the last 2 years, and in numerous other correspondences. APTA has also had several meetings with HCFA on this issue. Most recently, HCFA stated in the final physician fee schedule rule that they are carefully examining the issue. We are still awaiting action.

Correct Coding Initiative Edits

On January 1, 1996, the Health Care Financing Administration (HCFA) implemented a national Medicare policy involving more than 80,000 coding edits that restricted certain coding combinations. AdminaStar Federal developed these code edits under a contract with HCFA. These code pair edits are combinations of two CPT codes that cannot be billed together because either the code pair represents services that are considered mutually exclusive or one code in the pair is considered a component of a more comprehensive procedure code. The CCI edits are applied to services furnished in physical therapist private practice offices and in outpatient hospitals.

APTA recognizes the need for HCFA to create edits in their systems to detect inappropriate billing. However, HCFA has created a number of edits that do not make clinical sense, and therefore are inappropriate. APTA has requested that HCFA delete the problematic code pair edits, but is still awaiting such deletion.

Clarification of Use and Documentation of Timed Codes

In March of 2000, HCFA issued program memorandum AB-00-14, "Questions and Answers Regarding the Prospective Payment System (PPS) for Outpatient Rehabilitation Services and Physical Medicine Current Procedural Terminology (CPT) Coding Guidance." This program memorandum answers questions related to Medicare outpatient therapy policies and provides guidance regarding coding therapy services. Because most physical medicine and rehabilitation codes are 15 minute timed codes, the memorandum defines how to bill for a 15 minute unit and how to determine what services count as time. Specifically, in AB-00-14, HCFA states that when billing units of therapy, one unit is equal to or greater than 8 minutes but less than 23 minutes of care. Two units are equal to or greater than 3 minutes but less than 38 minutes, and so on. Providers are instructed not to bill for anything less than 8 minutes of care. HCFA also states "pre-and post- delivery services are not to be counted in determining the treatment service time.

The language regarding counting minutes of therapy has caused considerable confusion. APTA, along with other rehabilitation organizations, met with HCFA in June 2000, to discuss the policy and clarify any confusion associated with it. At that meeting, HCFA agreed to develop a question and answer program memorandum that would further clarify how to determine what time counts as a 15-minute unit and how to bill for units of service. In this program memorandum, HCFA would respond to questions developed by the organizations. The questions were submitted to HCFA on July 21, 2000, and APTA is still waiting for HCFA to issue this program memorandum.

Stark II law

HCFA published an interim final rule (66 Fed. Reg. 856) on January 4, 2001, which incorporates into regulations the provisions in paragraphs (a), (b), and (h) of section 1877 of the Social Security Act. This law, referred to as the "Stark II" law, prohibits physicians from referring Medicare and Medicaid patients for designated health services" to health care entities in which they have a financial relationship, unless an exception applies. According to the law, physical therapy is a "designated health service."

APTA was pleased to see that HCFA published a final rule and supports the intent of the Stark II regulations. Physical therapists and patients needing physical therapy services are adversely impacted by physicians that obtain financial gain by referring patients to their own clinic for physical therapy services.

Although we are pleased to see that these issues are being addressed in HCFA's regulations, we are seriously concerned that some of the provisions in the interim final rule weaken the Stark II law and open the door for physician abuses in the provision of physical therapy services.

HIPAA: Final Rule on Privacy of Individually Identifiable Health Information

The Department of Health and Human Services released the long awaited final privacy regulations on December 20. The Final rule implements the privacy provisions of the Health Insurance Portability and Accountability Act (HIPAA) and sets forth complex limitations on the use of individually identifiable health information by most health care providers (including physical therapists), health plans, and clearinghouses.

While APTA supports the protection of individually identifiable health information, the regulation that was issued is extremely cumbersome for our membership. For example, providers have to ensure the compliance of their business associates and have a new duty to mitigate known privacy violations by third party contractors. Many of our members are small business providers and the cost for implementing the requirements of the privacy regulations will be too onerous.

Reimbursement for Physical Therapy Students

There is considerable confusion regarding HCFA's policy on supervision and reimbursement for therapy student services under Medicare in the outpatient therapy setting. The American Physical Therapy Association (APTA), American Speech Language Hearing Association (ASHA), and American Occupational Therapy Association (AOTA) met with HCFA to discuss this problem in March 2001. After this meeting, HCFA began working on a program memorandum regarding reimbursement of services for students under Medicare Part B. The therapy associations are still awaiting issuance of this program memorandum. We are hoping that the issuance can be expedited. It is our hope that HCFA's policies will ensure that students can continue to obtain the clinical training they need to better serve Medicare beneficiaries in the future.

Provider Education

Many physical therapists have difficulty finding the "right" answer to questions regarding Medicare requirements. Carriers and intermediaries often give incorrect information to providers. There appears to be a lack of communication of information between HCFA national and the carriers and fiscal intermediaries.

In addition to receiving incorrect information from carriers and fiscal intermediaries, providers find that carriers and fiscal intermediaries are interpreting HCFA regulations and policies differently throughout the country. As a result, providers in different regions are subject to different standards for Medicare coverage and reimbursement. There is a need for uniformity. Physical therapists are trying to provide good patient care while complying with Medicare regulations, but because of the confusing and conflicting information they are provided, this has become more difficult.

There is a need for HCFA national to provide clear, concise guidance on its Medicare policies to its fiscal intermediaries and carriers, to national associations, and to providers. This guidance would ensure providers receive accurate and timely information to assist them in complying with Medicare requirements.

HCFA recently contracted with DynCorp to examine inconsistencies throughout the country with respect to Medicare coverage and reimbursement of occupational therapy, physical therapy, and speech-language pathology services. It is our hope that DynCorp and HCFA can remedy this problem through their work on this project.

Alternative Payment Methodology

The Balanced Budget Act of 1997 mandated an alternative payment policy be implemented for outpatient therapy services. Originally, a $1500 limit was placed on outpatient therapy services until an alternative payment policy was developed and implemented. This arbitrary limitation on services proved to have an adverse impact on patients, and in 1999, Congress placed a 2-year moratorium on the $1,500 limit. HCFA is still required to develop the alternative payment policy for outpatient therapy services and report to Congress on an alternative by January 1, 2001.

Due to a provision in the BBA of 1997, beginning January 1, 1999 all outpatient therapy providers, are reimbursed according to the physician fee schedule instead of a cost-based system. Therefore, APTA does not believe its necessary to develop an alternative payment methodology because the needed savings are achieved under the physician fee schedule.

Practice Expense Methodology

In determining payment under the physician fee schedule, there are three relative values: 1) relative value (RVU) for clinical work, 2) RVU for practice expense, and 3) RVU for malpractice expense. In January 1999, the practice expense RVU was revised to be resource based rather than charge based. In the November 1998 Medicare Fee Schedule rule, HCFA discussed its methodology for developing these resource based practice expenses. We believe that the methodology used to determine the physical therapy practice expenses is flawed.

APTA believes that the administrative payroll, office, and other practice expenses per hour used by HCFA in computing the practice expense component of RBRVS under the Medicare Physician Fee Schedule is not sufficient to reflect expenses of physical therapists in private practice. APTA urges HCFA to adopt data from a survey conducted by the APTA during 2000. In the alternative, APTA believes that the "all physician" category more accurately reflects practice expense costs for physical therapists in private practice.

Medical Review and Audits

There are many problems with the current medical review and audit process. In many instances, the auditors do not understand the regulations that apply to physical therapy providers, and thus inappropriately seek overpayments. In addition, providers find that they are not given a reason for the overpayment determination, and carriers and intermediaries are unwilling to answer provider questions about the overpayment determination. Therefore, providers are forced to devote considerable time and resources to defend themselves.

In a number of cases, carriers and fiscal intermediaries seek overpayments based on a "technicality". For example, the physical therapy service was provided, was medically necessary, there is documentation in the file to support the medical necessity of the service provided, and a physician signed the order for services. Despite proof of medical necessity in the clinical record, the auditor still seeks the overpayment because the physician did not date the order. Thus, the provider is required to pay the money back to the Medicare program, because of this missing information.

APTA recommends that HCFA educate its auditors about its policies and regulations pertaining to physical therapy services, and ensure that providers are given sufficient rationale for the overpayment determinations.

Appeals

Approximately, 85% of the appeals that come before the Administrative Law Judges are overturned. When Medicare determines that there is an overpayment, the provider often must pay the overpayment before the appeal is heard. Many physical therapy providers who have received overpayment determinations are small business owners. To require the return of the overpayment when the provider believes the determination was made in error is extremely costly and a violation of due process. Therefore, APTA recommends that HCFA prohibit recovery of alleged overpayments until appeals have been exhausted.

Additionally, APTA believes that HCFA should permit physical therapists to appeal an alleged overpayment without waiving their administrative appeal rights. In many instances, a therapist will receive a consent letter informing them of an overpayment determination. The letter provides three choices: pay back the money and forego any appeal rights; provide additional documentation and forego any appeal rights; or appeal the overpayment determination but subject the company to a full blown investigation. APTA believes that these choices are unfair and deny providers due process.

Conclusion

We appreciate your serious consideration of APTA's concerns and recommendations. We recognize that HCFA has numerous regulations that need to be implemented as a result of the Balanced Budget Act of 1997, the Balanced Budget Refinement Act (BBRA), and BIPA. Because of the major impact of these regulations on the provision of critical rehabilitation services to Medicare beneficiaries, it is our hope that HCFA addresses these issues expeditiously.

We frequently hear from physical therapists that they can no longer provide services to Medicare patients because of the onerous regulations and unfair review processes. The purpose of the Medicare program is to provide access to quality health care services for senior citizens. Unfortunately, due to the number and complexity of Medicare regulations, beneficiaries may have difficult getting access to the rehabilitation services that they need.

The APTA looks forward to working with you and the rest of the Committee members to address these concerns on behalf of the physical therapy community and the patients they serve. For more information, please contact Patrick Cooney at (703) 769-0020. Thank you for your consideration of these comments.

APTA represents more than 68,000 physical therapists, physical therapist assistants, and students of physical therapy. The goal of APTA is to foster physical therapy practice, education, and research.