Medicare allows limited billable interactions between students and beneficiaries. Medicare law describes the professions that are qualified to provide services to beneficiaries. Practitioners must be licensed by the state or have a credential such as the ASHA Certificate of Clinical Competence in those states without licensure. 
The student policy described below does not apply to Clinical Fellows practicing in states that grant Clinical Fellows temporary or provisional licensure; such licensed practitioners are fully qualified according to Medicare regulations. However, in states without such licensure, Medicare treats Clinical Fellows as graduate students requiring "in the room" supervision. Go to ASHA's State Specific Licensing and Regulatory Resources for more information on licensing laws in your state.
Medicare has no specific student supervision restrictions for Part A patients in hospitals and, effective October 1, 2011, more restrictive regulations for skilled nursing facilities (SNFs) have been removed to promote greater conformity with other inpatient settings. Medicare regulations now state "each SNF would determine for itself the appropriate manner of supervision of therapy students consistent with applicable state and local laws and practice standards."
However, in guidance on adherence to the new SNF regulations [PDF] (slides 18–28, 33–34), the Centers for Medicare and Medicaid Services (CMS) clarifies that the supervising clinician cannot treat another resident or supervise another student while the student is treating a resident. CMS notes that ASHA (and the American Physical Therapy Association and American Occupational Therapy Association) provides recommended guidelines for student supervision [ZIP]. ASHA's guidelines are reproduced below.
The CMS restrictions on billing students' services are based on two principles; for billing purposes, the student is considered an extension of the therapist and only one billable service can be provided at one time by the student/supervisor. Billing guidance includes the following:
These regulations apply only to Part A residents in SNFs; more restrictive student rules for Part B services (i.e., 100% supervision in the room) in SNFs and other settings remain unchanged.
ASHA submitted the following guidance on supervision of students to CMS; the guidelines are not included in the regulation, but are references in implementation guidelines.
ASHA received a formal response to concerns raised when some Medicare carriers refused to acknowledge a Medicare program clarification sent to ASHA (November 9, 2001) relating to payment involving therapy students for Part B services. The CMS policy is found in the Medicare Benefit Policy Manual, Chapter 15, Section 230.B.1 [PDF].
Section 15/230.B.1 of the Medicare Benefit Policy Manual "manualizes" Program Memorandum (PM) AB-01-56, "Questions and Answers Regarding Payment for the Services of Therapy Students Under Part B of Medicare." Section 15/230.B.1 indicates that a therapist may bill and be paid for the provision of services when the "qualified practitioner is present and in the room for the entire session." The student may participate "in the delivery of services when the qualified practitioner is directing the service, making the skilled judgment, and is responsible for the assessment and treatment." Section 15/230.B.1 further states that billing and payment are appropriate when the "qualified practitioner is present in the room guiding the student in service delivery when the therapy student...(is) participating in the provision of services, and the practitioner is not engaged in treating another patient or doing other tasks at the same time."
These rules apply to both individual and group therapy. One-to-one patient contact is not necessary for group therapy even though constant attendance is required.
This student policy does not apply to clinical fellows practicing in States that grant clinical fellows temporary or provisional licensure (as discussed above). However, in States without such licensure, Medicare treats clinical fellows as graduate students requiring "in the room" supervision.
A November 9, 2001, letter was received by ASHA from Terrence L. Kay, Director of the Division of Practitioner and Ambulatory Care in the CMS Center for Medicare Management, clarified the student issue with specific regard to speech-language pathology and audiology students.
The letter states that Medicare requires that the qualified practitioner be "in the room guiding the student in service delivery when the graduate student is participating in the provision of services, and the practitioner is not engaged in treating another patient or doing other tasks at the same time. Mr. Kay's letter also states, "The qualified practitioner is responsible for the services and as such, signs all documentation." He added parenthetically that the student may also sign the documentation if desired.
Mr. Kay included two scenarios, one for speech-language pathology services and one for audiology services, to illustrate Medicare Part B billable services. They are:
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 In states without licensure, the individual must have successfully completed 350 clock hours of supervised clinical practicum, performed not less than nine months of supervised full-time audiological or speech-language pathology services after obtaining a master's or doctoral degree in audiology, speech-language pathology, or a related field, and successfully completed a national examination in audiology or speech-language pathology.