Changes to the Medicare Physician Fee Schedule, as proposed by the Centers for Medicare & Medicaid Services (CMS), have brought Physical Therapy Reimbursement Rates under the lens. As the Physical Therapy community braces for the fourth consecutive year of reduced Medicare payments, this in-depth analysis aims to decode the implications of the 2024 fee schedule for outpatient physical therapy services.
UPDATE (3/10/2024): The “Consolidated Appropriations Act, 2024” was signed into law on March 8, 2024. The Act decreased the Medicare reduction for the remainder of 2024; as a result, Medicare rate reduction effective March 9, 2024, will be approximately 1.8% rather than 3.5%.
A Brief Overview
As outlined in the 2024 Medicare Physician Fee Schedule rule, a 3.4% reduction in the conversion factor points towards a continued trend of reduced Medicare payments for physical therapists and several other healthcare providers. However, several proposed policy changes, such as modification of Physical Therapist Assistant (PTA) supervision standards, introduction of new codes for caregiver training, and the extension of telehealth, may positively affect physical therapy access.
Overview of 2024 Physical Therapy Reimbursement Rates Changes
The Conversion Factor Cut: A Closer Look
The final rule for 2024 introduces a 3.4% reduction in the conversion factor, a key element used in calculating final payment amounts for various codes. This decrease, from the $33.8872 conversion factor adopted in 2023 to $32.7375, affects more than 27 specialties, including physical therapy.
Despite the negative impact, this cut is less damaging than the initially anticipated 4.2% drop. According to CMS, this milder reduction is the result of reconsidered utilization estimates of a particular evaluation and management add-on code. However, the only potential relief from these cuts now lies in the hands of Congress, which could provide last-minute appropriations, as it did for the past three years.
Impact on 2024 Physical Therapy Reimbursement Rates
The table below provides a comparative look at the 2024 medicare fee schedule for the top 10 CPT Codes for outpatient physical therapy.
2024 vs. 2023 Medicare Reimbursement Rates for Physical Therapy (National Payment Amount, Non-Facility)
HCPCS Code | Description | 2023 | 2024 |
97110 | Therapeutic exercises | $29.82 | $28.82 |
97112 | Neuromuscular reeducation | $34.23 | $33.07 |
97140 | Manual therapy 1/> regions | $27.45 | $26.52 |
97150 | Group therapeutic procedures | $17.96 | $17.68 |
97530 | Therapeutic activities | $37.62 | $36.02 |
97116 | Gait training therapy | $29.82 | $28.82 |
97161 | Pt eval low complex 20 min | $101.66 | $98.56 |
97162 | Pt eval mod complex 30 min | $101.66 | $98.56 |
97163 | Pt eval high complex 45 min | $101.66 | $98.56 |
97164 | Pt re-eval est plan care | $70.49 | $68.44 |
The following reimbursement data is based on the National Payment Amount (MAC: 0000000). Reimbursement rates will vary slightly depending on your MAC locality. Providers can look up fee schedule per their MAC locality here.
While the changes in the 2024 Medicare Physicians Fee Schedule present a challenging landscape for Physical Therapists, it's also important to remember that the advocacy efforts of organizations like APTA are continuously working towards fee schedule reforms. As the healthcare industry navigates these changes, the focus remains on providing quality care to patients and ensuring fair compensation for providers.
Reimbursement for CPT Code 97110: Therapeutic Exercises
Therapeutic exercises will be decreased from $29.82 (2023) to $28.82 (2024)
Reimbursement for CPT Code 97112: Neuromuscular Reeducation
Neuromuscular reeducation will be decreased from $34.23 (2023) to $33.07 (2024)
Reimbursement for CPT Code 97140: Manual Therapy
Manual therapy will be decreased from $29.82 (2023) to $28.82 (2024)
Reimbursement for CPT Code 97530: Therapeutic Activities
Therapeutic activities will be decreased from $37.62 (2023) to $36.02 (2024)
Reimbursement for CPT Code 97116: Gait Training
Gait training will be decreased from $29.82 (2023) to $28.82 (2024)
Reimbursement for CPT Code 97150: Group Therapeutic Procedures
Group therapeutic procedures will be decreased $17.96 (2023) to $17.68 (2024)
Reimbursement for CPT Code 97161: PT Eval Low Complexity
PT eval low complex will be decreased from $101.66 (2023) to $98.56 (2024)
Reimbursement for CPT Code 971612: PT Eval Moderate Complexity
PT eval moderate complex will be decreased from $101.66 (2023) to $98.56 (2024)
Reimbursement for CPT Code 97163: PT Eval High Complexity
PT eval high complex will be decreased from $101.66 (2023) to $98.56 (2024)
Reimbursement for CPT Code 97164: PT Re-eval Establish Plan of Care
PT re-eval est plan care will be decreased from $70.49 (2023) to $68.44 (2024)
The American Physical Therapy Association (APTA), in collaboration with the American Occupational Therapy Association and the American Speech-Language-Hearing Association, have presented Congress with a set of policy principles aimed at overhauling the existing payment system.
Other Notable Medicare Physicians Fee Schedule Updates
CMS Adjustments to KX Modifier Thresholds
The final rule also includes changes to the threshold for the use of the KX modifier, which indicates that a service meets the criteria for a payment ceiling exception. The threshold has been set at $2,330 for Physical Therapy and Speech-Language Pathologist services combined, and $2,330 for occupational therapy services. The Medical review threshold remains at $3,000 through 2027.'
Revaluation of Practice Expense Elements for Therapy Codes
In early 2023, APTA argued that several codes frequently used by Physical Therapists were unfairly cut due to a kind of double jeopardy. APTA claimed that both devaluations occur for the same apparent reason - to adjust for a repeated practice expense when multiple codes are used in a day. They informed CMS that double discounting codes for the same reason was illogical.
These codes included therapeutic exercises, neuromuscular reeducation, gait training, and therapeutic activities. APTA's advocacy led CMS to direct the AMA Relative Value Scale Update Committee (AMA RUC) to re-review its earlier value recommendations. This move could potentially increase the practice expense elements for 19 therapy codes.
New Caregiver Training Codes
Another positive development for APTA is the finalization of codes that would allow Physical Therapists, Occupational Therapists, Speech-Language Pathologists, and other providers to bill for providing training to caregivers when a patient with a functional deficit is not present. The final rule includes a broader definition of "caregiver" that expands to include not just relatives of the beneficiary, but also other adults who have a significant relationship with the individual and provide a broad range of assistance.
The codes, found on Page 285 of the final rule, will be considered "sometimes therapy" and thus not subject to the Multiple Procedure Payment Reduction system. Despite APTA's advocacy otherwise, the codes won't be eligible for use in association with telehealth.
Telehealth Coding and Remote Therapeutic Monitoring Treatment Management Codes
CMS has made several clarifications in the 2024 rule regarding telehealth coding and reporting remote therapeutic monitoring treatment management codes. These changes, including allowing Physical Therapists in institutional settings to participate in the telehealth extension in place through 2024, aim to ensure better access to telehealth services for patients. Institutional PTs can participate in telehealth by using the same 95 modifier.
Positive Changes in PTA Supervision
The final rule also includes several positive changes around PTA supervision, including the consideration of general supervision in private practice settings, an extension of virtual supervision allowances, and relaxation of supervision associated with Remote Therap
eutic Monitoring (RTM).
Participation in the MIPS Value Pathways Program
The rule finalizes several proposed changes to the Physical Therapist's role in the CMS Quality Payment Program, specifically within the Merit-based Incentive Payment System (MIPS) and its MIPS Value Pathways program (MVP). Physical Therapists now have their first-ever opportunity to participate in the MIPS Value Pathways Program through the first cost measure they'll be able to report.
Conclusion
The 2024 Medicare Physician Fee Schedule brings both challenges and opportunities for the Physical Therapy community. While the 3.4% reduction in the conversion factor is a significant concern, other policy changes could lead to increased access to Physical Therapy services. As Physical Therapists navigate this complex landscape, it's important to stay informed, advocate for fair compensation, and continue to provide high-quality care to patients.