One of the loudest complaints in the physical therapy field is about poor reimbursement. A LOT of our problems stem from issues with reimbursement. Low reimbursement or insurance denials of reimbursement are big drivers for stagnant PT salaries. Insurance denials lead to a lot of admin and authorization burden. The APTA actually just put out a statement on what a major issue in the profession this is. Low pay and increased workload contribute to the ever-rising burnout of PTs.
If we somehow got reimbursement right, a lot of things might get better for us and our patients. So it’s only fair we take a look at how we bill our services and how we’re reimbursed for them, if these systems actually make sense, and if they don’t how would we go about changing them?
How We Bill
The way PT and other rehab services are billed is truly unique compared to other healthcare professions. If you’re a current PT you know we run off the obscure 8-Minute Rule. For every 8 minutes of service, we can charge 1 unit. For those units we have SEVERAL different codes that we can charge. However, we must complete that intervention for at least 8 minutes
We are only one of a few healthcare professions whose charges are time-based. Most other professions are by visit or service. We are also only one of a few who have so many codes to possibly charge. (Now that doesn’t mean we can always charge them). Think about the list we have available to us. There’s therex, theract, manual therapy, neuro re-edu, gait and that’s just to name a few.
This is very different from other healthcare providers. For example PCPs pretty much just charge office visits and/or annual wellness checks. Even speciality clinics don’t have many codes. Again, those providers just mainly use a visit charge plus some procedure charges unique to their speciality. All these charges are also completely independent of time. They can make these charges whether it takes 15 minutes or 30 minutes.
How I Think PT Should Be Billed
If you’re not new to The PT Page, it won’t surprise you that I’m going to give my unsolicited opinion on the matter. In my opinion, we keep the 8-minute rule, but get rid of having all the different codes.
Okay, hear me out. We keep the 8-minute rule because I think it’s good. I think it actually does help with the quality of care. Part of the reason I like being a PT and not an MD is because I actually get to spend quality time with my patients. In our field we have to have time to do exercises, teach new ones, perform treatments, and complete patient education.
If we take the 8-minute rule away what’s to stop all our places of employment from shrinking our visit times to 15 minutes? You thought you were seeing a lot of people before? If the 8 minute rule goes away you’re about to see a whole lot more. PT mills already find so many ways to take advantage of us and patients, let’s not give them another. If treatment times shrink I also hate to imagine the impact it will have on our effectiveness when it comes to treating patients.
When it comes to codes, I think we shouldn’t have so many. In my opinion it makes things way more complicated when it comes to reimbursement and authorization. Where I work I have a lot of insurance providers either saying I can only bill certain codes or I have to ask for certain codes and they only give me so many units of each one that I can charge for.
It opens up so much room for mistakes to be made and for insurance to deny reimbursements. Also I feel like I am the provider, I should be able to do what I think is right for the patient, not just the codes the insurance company gave me. So what’s the point of them anyway?
I think we should just have a follow up visit / treatment code where I can do anything in my patient’s session and I don’t have to do 8 minutes exactly of therex or theract or whatever. We just do what we need to do.
Now the one potential issue I see with this is that what if insurance decides to reimburse us low for that one treatment code and it results in an overall net loss in revenue. I’m of the attitude we should be reimbursed at the rate of our highest code, which is theract at about $36-38 per unit. Or at least an average of the most common codes such as therex, theract, neuro re-edu, gait, and manual therapy.
So to recap, in my opinion we bill one treatment / follow-up visit code to simplify billing, but we keep the 8-minute rule to maintain face-to-face time and quality care with our patients. Once again, just me spit-balling here and sharing my thoughts no one asked for. How do you think we should be billing? What would you change about it? Share in the comments.
How We’re Reimbursed
So that’s all about how we bill / how I think we should bill. But what about reimbursement? Who is this mysterious all-powerful reimbursement god that determines so many of our fates? That would be the Physician Fee Schedule (PFS).
The Physician Fee Schedule is just a list of payment rates that is put out by the Centers for Medicaid and Medicare Services (CMS). It determines payment amounts for different CPT codes under Medicare. This list is revisited annually. It is based on what CMS calls Relative Value Units (a.k.a. RVUs – factors like clinician work, expenses, and liability) and a conversion factor, which is often lowered or does not keep up with inflation, resulting in payment cuts.
So every year when you see APTA post about “fight the cuts” – this is what they’re talking about. This year is a little different though, because for once the conversion factor was actually raised and PTs on average are getting about a 1.75% increase in reimbursement. Doesn’t quite make up for all the cuts over the last few years, but it’s a step in the right direction.
Now some of you may be like, well wants the big deal? This is just for Medicare right? There’s plenty of other commercial insurances that also make up our payer sources. While that’s true, the problem is Medicare sets the tone for what private insurance companies do.
So if one year the physician fee schedule results in decreased payment rates, Medicare cuts reimbursement, and then private insurers will also reduce reimbursement rates. On top of cuts, both Medicare and private insurers continue to change authorization and billing requirements which results in increased administrative burden.
So when you start to see where our reimbursement rates come from and the factors influencing it – cuts, not keeping up with inflation, increased administrative burden – it’s easy to see how we end up being left with only a small piece of the pie. I am curious to see how private insurances respond to the increased reimbursement rates on the physician fee schedule.
How We Actually Change Reimbursement
Actually changing our reimbursement would be no easy feat. In short, it comes down to a combination of advocacy and data.
The first step is changing CMS physical therapy reimbursement rates. Like I said earlier, CMS largely influences what commercial insurers do. Changing CMS means changing the game. However this involves large-scale advocacy for policies that fixes the fee schedule, addresses cuts and budget neutrality, and expands coverage for PT services.
We can all participate and help do these things by supporting APTA in advocacy efforts, backing and voting for candidates and legislation that furthers our cause, participating in lobby days, meeting with legislators, and responding during proposed rule comment periods. Hopefully my explanation earlier of how CMS determines so much of our payment put into perspective how important advocacy is and encourages you to participate.
That advocacy might go a lot better if we show PT value in something other than timed units. Payers and legislators need to see how PTs reduce downstream costs – less meds, imaging, surgeries, etc. Yes, there is already a decent amount of research on this, but, we need more and we need the data that shows the effect on the healthcare system as a whole. One of the early blog posts I wrote was on how primary care PT could save the healthcare system a shit ton of money, but that “shit ton” is still an educated guess. I couldn’t find concrete numbers on it.
Now many will also suggest we just stop taking Insurance and go cash pay. Unfortunately this is probably the part where I piss some people off by saying that’s not a good argument.
TO BE CLEAR – I don’t think cash pay is bad or wrong. I think the cash pay movement was good for the profession and I completely get why people do it. Cash pay reduces a reliance on insurance which is needed in our profession right now. I would love to eventually see all the PT mills who take insurance out there die and be replaced with cash-pay clinics that give quality 1-on-1 care that doesn’t tarnish our reputation and prevent our advancement.
However in terms of change it does absolutely nothing. Some argue it puts pressure on insurance companies to eventually pay us what they owe us.
But it doesn’t. Insurance companies do not give two shits if people are going to go pay cash for their PT. In fact, it’s a win for them because now they don’t have to do all the approvals and mostly denials of all the PT visits of their beneficiaries. Basically they don’t have to deal with us anymore.
That’s not changing anything and this blog post is more about how we would change reimbursement. Therefore cash pay isn’t going to make into my list of steps to achieve this. Sorry, not sorry. Again, nothing wrong with cash pay.
I wish there was a simpler way to talk about reimbursement and billing. It gets convoluted very easily. The good news is that usually means there may be more than one way to fix it.
One thing I didn’t get into for times sake in this post was value based payment systems and how that might change the way we bill and are paid. If you’re familiar with these, how do you think this would work?
In this post I suggested we keep the 8-minute rule, or at least something like it, to maintain our time with patients. What do you think about this? After reading about how much CMS determines payments, do you think you will participate more in advocacy efforts and public comment periods to influence legislation?
So many places to have thoughts and ideas on this topic. Share em’ all in the comments! I wanna hear em! If you liked this post make sure to hit subscribe below to get new PT Page content directly to your inbox and make sure to follow @the_pt_page on Instagram to stay up to date on all things PT.
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