The 9% Medicare Cut:
Status of the New Legislation
Medicare has announced a 9% reduction in the PT/OT fee schedule as of 1/1/2021 followed by an incremental 15% cut in PTA/COTA reimbursements (a 24.3% total cut) as of 1/1/2022.
Industry wide, the familiar voices are telling us, “IT’S TIME FOR ADVOCACY!!!”
We agree.
But advocacy is only part of what’s needed to protect your practice and your family.
Let’s review the details before discussing how you can offset the 9% payment reduction.
CMS is adjusting relative payment rates for all sectors of healthcare covered by Medicare. By law, overall spending is not allowed to increase, so those disciplines that receive payment increases (for example, Endocrinology will enjoy a 17% increase in their Medicare fee schedule) will be funded by lowered fee schedules in other medical disciplines.
- CMS cut Medicare reimbursements for 32 medical disciplines, PT/OT is one of them
- 3 disciplines were unchanged
- And CMS increased Medicare reimbursements for 20 medical disciplines
Note Table 90 from the CMS 2021 proposed rule. Column F shows the 2021 fee schedule adjustment.
Understanding that 31 other medical disciplines will also experience payment reductions is key in determining how to react.
Should we advocate for higher reimbursements? Of course we should.
But we have to remember that the other 31 medical sectors being cut are often larger by volume than PT/OT. Disciplines being cut, such as “cardiac surgery, critical care”, are often more directly related to immediate life and death situations than PT/OT. Certainly, “infectious diseases” (cut by 4%) could be seen as “top priority” in today’s world. Finally, many of the other 31 disciplines being cut have much larger and more affective lobbying associations.
Advocacy is wonderful. We just need to remember that many of the other 31 sectors that are being cut may have an even stronger argument than we do. Said differently, we need to do more than just advocate.
Well what about all the recent legislation?
November 2nd, the APTA ran the story, “New Legislation Targets Medicare Payment Cuts”. The story discussed House Resolution 8702, Holding Providers Harmless From Medicare Cuts During COVID-19 Act of 2020“, which would apply to all 32 medical disciplines at risk of being cut.
This is EXACTLY what we need! Examining the details, H.R. 8702 updates the following activity:
H.R. 8702: Referred to the Committee on Energy and Commerce, and in addition to the Committee on Ways and Means, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned
The bill was assigned to Committee on Energy and Commerce on October 30th. Nothing happened since.
And what about House Resolution 7154?
Back on June 12th, the APTA broke the story, “New Legislation Could Lead to Major Wins in Medicare Payment, Telehealth. A bipartisan bill in the House would allow CMS to avoid damaging cuts in 2021 and establish permanent telehealth for therapy providers.”
Again, let’s examine the details. Researching H.R. 7154 we see the following activity:
| 06/11/2020 | Referred to the Committee on Energy and Commerce, and in addition to the Committee on Ways and Means, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned. Action By: House of Representatives |
The bill was assigned to Committee on Energy and Commerce on June 11th. Nothing happened since.
Translation: Nothing has happened. Nothing is about to happen. It is unclear if anything EVER will happen.
In summary, we can all hope that H.R. 8702 or H.R. 7154 becomes law, but “betting your practice on it” is not advised.
So, What Options Are Left?
Beyond advocacy and hoping that H.R. 8702 or H.R. 7154 advances, an old cliché comes to mind:
You shouldn’t depend on the government to solve your problems.
You have the ability to fully offset the negative impact of the 9% Medicare fee reductions. On your own, right now.
Practices that install Systems 4PT average 9.6% higher collections overall vs. their prior approach to billing. (For 17 years we have measured collections before and after our system installations.)
2020 has been “worse than terrible” for many practice owners, only to be followed by a 9% reimbursement cut.
More has changed in 2020 than ever before in your career
Practice owners have no choice, you need to change as well
You can completely mitigate the looming 9% reimbursement cuts.
Systems 4PT is the undisputed technology leader in outpatient rehab.
We deliver:
- Twice the Medicare compliance, documented in half the time
- Average collections that are 9.6% higher vs. your current performance
- For 30% less than you spend today for EMR and billing
The above is why Systems 4PT enjoys the highest customer satisfaction of any EMR in outpatient rehab.