Medicare Patients May Exceed Therapy Caps

see also: Documentation Plays Critical Role in Cap Exceptions

by Ingrida Lusis

The Centers for Medicare and Medicaid Services (CMS) will allow an automatic exception from the $1,740 therapy cap to beneficiaries whose diagnosis requires concurrent physical therapy and speech-language pathology services, as well as other specified diagnoses and conditions. The recently enacted Deficit Reduction Act of 2005 required CMS to develop a process by which beneficiaries could receive medically necessary services above the therapy caps.

CMS issued implementation instructions to contractors on Feb. 13 that outlined the retroactive exceptions process; these "exceptions" describe diagnoses and conditions that exempt patients from the caps beginning Jan. 1. Speech-language pathologists whose claims have been denied because of the cap should contact their Medicare contractor to request that the claim be reopened and reviewed to determine if the beneficiary would have qualified for the exception.

Types of Exceptions

Exceptions fall into two categories:

Automatic exceptions

• Certain evaluation services, such as speech evaluation and swallowing evaluation, are excepted from the caps. The affected Current Procedural Terminology codes are 92506, 92597, 92607, 92608, 92610, 92611, 92612, 92614, 92616, and 96105.
• Certain conditions and complexities when supported by documentation justifying the need for therapy services.
• Additional exceptions as allowed by the local contractor.

Manual exceptions

• The provider makes a formal request to the contractor. The contractor makes a determination to allow additional treatment based on documentation submitted by the provider. 

A request to the contractor is not required for automatic exceptions, but is required for manual exceptions. The exceptions process only applies to current conditions for which a patient is receiving therapy services. SLPs should use the KX modifier only when documentation supports the need for services above the cap. Frequent use of the modifier could elicit additional scrutiny by the contractor.

Automatic Exception

After reviewing ASHA's National Outcomes Measurement System and existing Medicare claims, CMS developed a list of diagnosis codes for which services would most likely exceed the cap. If a beneficiary has a diagnosis designated as excepted, and exceeds the caps due to medically necessary services, additional services would be permitted. In this situation, each SLP service must be submitted with a KX modifier once they exceed the cap. Although services may meet the automatic exceptions criteria for the condition and other factors, the claims are still subject to contractor review to determine that the services are otherwise covered and appropriately provided.

CMS has indicated that it does not anticipate that many of the therapy services provided to beneficiaries presenting with one of the excepted diagnoses will exceed the cap. The modifier represents the attestation of the therapist that the patient has a condition or complexity on the list for which they are currently being treated and which is causing the services to exceed the caps.

Documentation must include the disorder treated, other comorbidities and complexities, and how these factors affect treatment. The condition or complexity must directly and significantly affect the type, frequency, intensity, and duration of the required, medically necessary skilled services over the cap.  Frequent use of the modifier could result in additional scrutiny by the contractor.

Other Clinical Complexities

Other factors may justify automatic exception for any condition that requires skilled therapy services, regardless of whether the primary diagnosis is excepted. Therapy rendered above the cap must be documented, covered, and medically necessary. The following situations may be taken into consideration for automatic exceptions:

• The beneficiary was discharged from a hospital or SNF within 30 treatment days of starting the episode of outpatient therapy.
• The beneficiary has, in addition to another disease or condition being treated, generalized musculoskeletal conditions or conditions affecting multiple sites not listed as automatically excepted by conditions that will directly and significantly impact the rate of recovery.
• The beneficiary has a mental or cognitive disorder in addition to the condition being treated that will directly and significantly impact the rate of recovery.
• The beneficiary requires physical therapy and speech-language pathology services concurrently. If the combination of the two services causes the cap to be exceeded for necessary services, the services are excepted.
• The beneficiary had a prior episode of outpatient therapy during the calendar year for a different condition.
• The beneficiary does not have access to outpatient hospital therapy, including residents of a SNF subject to consolidated billing.

Requesting an Exception

CMS notes that there will be instances when a diagnosis does not qualify for an automatic exception, but a beneficiary may benefit from additional services above the cap. In this case, the provider must request coverage of additional services in writing to the CMS contractor. This request should be faxed unless the contractor requests another form of communication. SLPs are encouraged to submit a request as soon as a determination is made that the patient will exceed the cap, but would benefit from additional services. The letter of request must include all pertinent portions of the medical record and a justification for a specific number of treatment days, not to exceed 15.