The House Republicans today released their bill that includes a payroll tax holiday, unemployment benefits, and a measure to speed up work on the Keystone XL oil pipeline among other issues. This bill contains a two year "doc fix" and a two year extension of the therapy cap exceptions process. The House intends to vote on the bill next week.
We do not yet know what will be in the Senate package as they have not finalized their package. Details will emerge next week.
The bill contains several provisions of great interest to providers. The following is a brief description of what we see in the bill right now. We will continue to analyze the impact of these provisions and will provide a more thorough summary and analysis next week.
Medicare Payment for Outpatient Therapy Services
- Stabilizes rates for two years by preventing a 27.4% cut in the Physician Fee Schedule and increases rates 1% each year for two years.
- Directs MedPAC, GAO and HHS to assist in developing a replacement system to pay for outpatient therapy. Directs the key health care committees and stakeholders to study and review the process and provide comments.
- Outpatient therapy cap exceptions process is extended for two years until December 31, 2013.
- Exceptions process is modified: Patients are still subject to the $1,880 cap. The claim must still contain the KX modifier indicating it's medically necessary. If therapy charges exceed a threshold of $3,700, this will trigger a manual medical review process. The $3,700 is applied separately to PT and SLP and then to OT.
- The exclusion for therapy provided in the hospital outpatient setting is gone on January 1st, 2012.
- Requirement for inclusion on the claim of the NPI of the physician who reviews the therapy Plan of Care.
- MedPAC shall prepare a Report on Improved Medicare Therapy Benefits such as how to reform the payment system for outpatient therapy services by March 1, 2013.
- Collection of Additional Data - HHS shall implement on January 1st, 2013, a claims based data collection strategy to assist in reforming the payment system.
- GAO Report on Manual Medical Review Process Implementation - no later than May 1, 2013, the GAO shall submit a report on the manual medical review process.
Work Geographic Adjustment
- Medicare Payment Advisory Commission shall submit to the Committees on Ways and Means and Energy and Commerce a report that assesses whether any geographic adjustment is needed under Section 1848 of the Social Security Act to distinguish the difference in work effort by geographic area and if so, what that level should be and where it should be applied.
Reduction of Bad Debt Treated as an Allowable Cost for Skilled Nursing Facilities
- Medicare reimbursed bad debt both for dual eligibles and private pays is reduced. The reduction begins in fiscal year 2013. For duals, Medicare reimbursable bad debt will fall from 100% to 55% by 2015. For private pays, it would phase down the payments from the current level of 70% to 55% over the same period of time.