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On November 1, 2012 CMS released the CY 2013 Physician Fee Schedule Final Rule.

Key provisions are as follows:

  • Final rule contains a 26.5% across the board reduction to Medicare payment rates effective 1/1/13. Congress has overridden the required reduction every year since 2003.
  • Therapy cap amount for 2013 is $1900 for PT/ ST combined and $1900 for OT.
  • An exceptions process to the caps has been in effect since 1/1/2006. If Congress does not act to extend the exceptions process, the exceptions process for the $1900 cap and the manual medical review for claims over $3700 expires 12/31/2012. 


  • CMS will collect information on functional status of beneficiaries requiring PT, OT, and ST on 1/1/2012 to assist with developing potential alternatives to the therapy caps.
  • Information for functional outcomes will be reported on claims and in therapy documentation through the use of Non-payable G-codes and modifiers.
  • Reporting requirements apply to all providers and suppliers of outpatient therapy services.  This includes services provided in a Skilled Nursing Facility for residents who receive Part B therapy.
  •  These non-payable G-codes will be used to define functional limitations. Reporting is required on 1 functional limitation. If the primary functional limitation goal is achieved, reporting will begin on a subsequent functional limitation using another set of G-codes.
  • G-codes will be used to describe the functional limitation that is  primary to the plan of care:
    • Mobility: Walking and Moving Around
    • Changing and Maintaining Body Position
    • Carrying, Moving and Handling Objects
    • Self- Care
    • Other PT/OT Primary Functional Limitations
    • Other PT/OT Subsequent Functional Limitations
    • Swallowing
    • Motor Speech
    • Spoken Language Comprehension
    • Spoken Language Expression
    • Attention
    • Memory
    • Voice
    • Other SLP Functional Limitation
  • Modifiers will be required for each functional limitation to report the severity and/or complexity utilizing a 7 point scale.
    • 0% impaired, limited or restricted
    • At least 1% but less than 20% impaired, limited or restricted
    • At least 20% but less than 40% impaired, limited or restricted
    • At least 40% but less than 60% impaired, limited or restricted
    • At least 60% but less than 80% impaired, limited or restricted
    • At least 80% but less than 100% impaired, limited or restricted
    • 100% impaired, limited or  restricted
    • CMS continues to require the use of objective measures to document functional status.  A specific assessment tool or test is not required.  Therapists may elect to use the most appropriate measure.
    • A projected goal for the beneficiary’s functional status at the end of the therapy episode will be translated to the G-code/modifier scale and reported on the first claim.
    • Reporting Frequency
      • Outset of therapy: current status and projected goal status
      • At least once every 10 treatment days. PROGRESS REPORTS WILL BE DUE EVERY 10 TREATMENT DAYS NOT EVERY 10 TREATMENT DAYS OR 30 CALENDAR DAYS WHICH EVER IS FIRST. CMS Manuals will be changed.
      • Discharge
      • If there is a significant change in beneficiary condition resulting in formal re-evaluation
      • Implementation date is 1/1/2013 with enforcement beginning on 7/1/2013.

Tags: nursing home occupancy, skilled nursing facility