Don't Let the Medicare Beneficiary Rehabilitation Therapy Cap Come Back!

(01/2002)

Unless Congress acts, beneficiaries will, again, face arbitrary limits on their rehabilitation therapy care. On January 1, 2003, the Medicare outpatient beneficiary caps on rehabilitation therapy will take effect. These $1,500 beneficiary caps on (1) speech-language pathology and physical therapy and (2) occupational therapy care combined will negatively impact care for our nation's seniors. The caps were partially implemented in 1999, but Congress has since twice placed such implementation under a moratorium until the end of this year. It is time to repeal these beneficiary caps once and for all!

Approximately 12-13% of beneficiaries needing therapy care will exceed the annual caps. Both MedPAC and independent analyses have demonstrated that nearly 1 out of 7 of such beneficiaries would exceed the beneficiary cap. If the cap comes back, beneficiaries may self-ration care or be forced to forgo medically necessary care altogether once the cap is exceeded.

The cap would negatively impact beneficiaries who suffer from stroke or other circulatory-related ailments, Parkinson's disease and musculoskeletal disorders. One analysis conducted in 1999 on the impact of the therapy cap during the first 2 months (based on actual Medicare claims) illustrated the following:

• Of those who exceeded the combined $1,500 cap for speech-language pathology and physicial therapy, 43% were beneficiaries who suffered from both stroke- and heart-related circulatory ailments and 28% were those who had osteoarthritis and related musculoskeletal disorders.
• Of those who exceeded the $1,500 cap for occupational therapy, 46% were beneficiaries who suffered from stroke-related ailments and 23% were those who had osteoarthritis and related musculoskeletal disorders.

It will be the older and more vulnerable beneficiaries who will be most impacted by the therapy cap. As beneficiaries continue to age and encounter multiple health problems, they are more likely to be the ones to exceed the cap.