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Congress Permanently Repeals the Medicare Therapy Caps and Ensures Payment for Speech-Generating Devices

February 9, 2018

Congress passed a continuing resolution (CR) to maintain funding for the federal government that included numerous Medicare and other provisions of interest to ASHA members. Most notably, Congress permanently addressed the outpatient therapy cap under Part B by repealing and replacing it with a more flexible targeted medical review threshold. Additionally, Congress permanently extended the Steve Gleason Enduring Voices Act, which authorizes the purchase of speech-generating devices (SGDs) and reverses previous Medicare regulatory guidance requiring these devices to be rented. 

Repeal of the Therapy Caps and Implementation of Targeted Medical Reviews

Since January 1, 2018, Medicare beneficiaries in need of outpatient rehabilitative services have been subject to a hard cap of $2,010. Congress has repealed the hard cap and established a targeted medical review threshold of $3,000. Once patients have exceeded the previous therapy cap amount of $2,010, speech-language pathologists are required to apply the KX modifier on the claim form to attest to ongoing medical necessity, and continue to submit claims for coverage. If the speech-language pathologist meets the targeting criteria established under the law, then the medical records for some of their claims above the $3,000 threshold may be requested for review.

ASHA believes the targeting criteria and process will be similar or identical to the exceptions process that had been in place since 2015, and ASHA staff have engaged the Centers for Medicare & Medicaid Services (CMS) to obtain additional information and guidance to share with our members. Congress has not provided additional resources for CMS to conduct these reviews, which seemingly limits the number of reviews that can be conducted each year. Another critical update to the targeted review policy included in the CR is an annual update to the threshold amount beginning in 2028 (previously, the threshold had remained static at $3,700). Additional details about the targeting criteria and settings to which the threshold apply can be found on the ASHA website.

Permanent Extension of the Steve Gleason Act

The CR includes a provision to permanently cover the purchase of SGDs under Medicare, based on the Steve Gleason Enduring Voices Act of 2017. SGDs are highly customized electronic augmentative and alternative communication (AAC) devices that are used to supplement or replace speech, allowing people with functional communication impairments to verbally communicate their needs. The largest population of those who need SGDs are patients with neurodegenerative diseases (e.g., amyotrophic lateral sclerosis (ALS), Parkinson’s disease, multiple sclerosis). These are conditions in which cognitive function and the need for communication remains intact, but the physiological ability to speak diminishes. SGDs are the only effective communication means for these patients. 

Prior to the passage of the Gleason Act in 2015, if an SGD user resided in a nursing home, hospice, or hospital, Medicare payment for their SGD stopped because the item was rented rather than purchased. Many of these facilities did not and could not supply beneficiaries with a uniquely customized substitute. The CR permanently extended the purchase right that was set to expire on October 1, 2018

CHIP Reauthorization Extension Until 2027

Last month, a previous CR passed in Congress that extended funding for the Children’s Health Insurance Program (CHIP) for six years. The CR passed today extends this funding further, through 2027.

Additional Funding of the National Health Service Corps

The National Health Service Corps has received additional funding for 2018 and 2019 to help support graduate education for health care professionals including audiologists and speech-language pathologists.

Repeal of the Independent Payment Advisory Board

The Independent Payment Advisory Board (IPAB) was a provision of the Affordable Care Act designed to help slow the growth in Medicare spending. The Board was to consist of 15 independent experts, appointed by the President and confirmed by the Senate. Its purpose was to implement Medicare spending reductions if the per capita growth in Medicare spending exceeds specified target levels. ASHA was opposed to the IPAB because its payment recommendations would be implemented automatically unless a super-majority of members of Congress took action to oppose specific provisions. 

Despite its inclusion in the law, IPAB has been largely unpopular among policymakers because it reduced their authority to make changes to the Medicare program. The IPAB would also have reduced the capacity of associations to represent the interest of their members and the consumers they serve. ASHA supported repeal because of the potential negative impact IPAB could have had on our members and the Medicare beneficiaries they treat. 

Mechanisms Identified to Pay for Improvements to the Medicare Program

Policy changes to offset the increases resulting from various Medicare improvements in the CR needed to be found to secure passage. Some of these offsets, often referred to as "pay-fors," included:

Changes to the Medicare Home Health Prospective Payment System

The CR would redesign the home health prospective payment system (HH PPS) by moving from the current 60-day episode to a 30-day episode beginning in 2020. Additionally, by 2020 the delivery of therapy cannot be a factor in the payment determination for home health services paid under Medicare. These provisions were pulled from a proposed rule issued, but not finalized, by CMS for the home health sector known as the Home Health Grouping Model (HHGM). Many other elements of the HHGM were not adopted under the CR; however, Congress specifically instructs CMS to study the implementation of the HHGM or similar alternative payment model, including the convening of a technical expert panel. Congress did require the program to be implemented in a budget neutral manner, which is a significant improvement over the proposed rule.

Additionally, Congress restricts the market basket update under the HH PPS in 2020 to 1.5%

Reductions to Medicare Payment Updates for Skilled Nursing Facilities

The market basket update to the skilled nursing facility prospective payment system (SNF PPS) is restricted to 2.4% in 2019.

Reductions in Medicare Payments for Services Provided by Physical and Occupational Therapy Assistants
Beginning in 2022, therapy services provided by physical and occupational therapy assistants will be reduced to 85% of the Medicare physician fee schedule in keeping with payment reductions applied to physicians’ assistants and nurse practitioners as compared to doctors. At this time, Medicare does not recognize audiology and speech-language pathology assistants for reimbursement. However, ASHA is actively engaged in the development of certification standards for these types of assistants and, once finalized, will actively pursue their inclusion in the Medicare program as a qualified practitioner. 

Reductions in the Medicare Physician Fee Schedule Update for 2019

Under MACRA, the annual payment update was set at 0.5% for 2016-2019 and at 0.0% 2020-2025 as part of the transition associated with the Quality Payment Program. Under the CR, the payment update for 2019 would be reduced to 0.25%.

Increase in Civil and Criminal Monetary Penalties for Federal Health Care Fraud and Abuse

The CR will update both the civil and criminal penalties for fraud and abuse in federal health programs that have largely remained static over the past 20 years. False claims would be subject to a $5,000 penalty per claim as compared to $2,000 under existing law. 

Adjustments to the Medicare Part B and Part D Premium Subsidies for Higher Income Individuals

Beginning in 2019, Medicare beneficiaries who have higher income levels will be subject to increases in their Part B and Part D premiums. Beneficiaries making $85,000 and above are impacted by this change with rates varying until incomes of $500,000 per year are reached.


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