Review of SGR/Therapy Cap Legislation

Posted on May 15, 2015 by Chapter Staff
Originally Published in HAPTA’s e-Newsletter, What’s HAPTAnin’ – May 2015


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Review of SGR/Therapy Cap Legislation

On April 14, 2015, the Senate passed the Medicare Access and CHIP Reauthorization Act (H.R. 2), which repealed and replaced the Medicare Sustainable Growth Rate (SGR) formula. The president signed the bill into law on April 16.

Included in the bill was an extension of the Therapy Cap exceptions process through December 31, 2017 and provisions for more targeted manual medical review. During the Senate deliberation of the bill, an amendment was introduced which, if passed, would have repealed the Medicare Therapy Cap once and for all. The introduction of this amendment was the culmination of a historic grassroots campaign, spearheaded by APTA and in conjunction with over 20 patient advocacy groups, including AARP. While the amendment ultimately did not pass, it received a tremendous showing of support, coming only two votes shy of passage (60 vote threshold needed). This amendment was the furthest the issue has been raised since the creation of the Therapy Cap 18 years ago. APTA staff will build off of this momentum and pursue further strategy for a future repeal.

Other provisions within the legislation include:

  • April 1- June 30, 2015: 0% update in payments
  • July 1, 2015- December 31, 2019: .5% update in payments
  • 2019 rates will be maintained through 2025 with increases available through the Merit-Based Incentive Payment System (MIPS)
  • Beginning in 2019: MIPS will be implemented tying payment to quality
  • Beginning in 2026 providers can receive payment increases for participation in alternative payment models (APM) 

For a more detailed summary of the Medicare Access and CHIP Reauthorization Act and to learn how it could affect your practice, please visit our Medicare payment and reimbursement webpage. Some of the highlights include:

  • Manual medical reviews of therapy cap exceptions won’t be based solely on dollar amounts. Sometime around mid-July, the $3,700 trigger for manual medical review (MMR) will be replaced with a system that links MMR to provider behavior and other factors. CMS will be looking at whether a provider has a pattern of “aberrant” billing practices, the provider’s claims denial percentage, whether the provider is newly enrolled, what types of medical conditions are being treated, and whether the provider is part of a group that includes another provider who has been identified in terms of the those factors. The new process will apply to exception requests that have not been conducted by the anticipated July startup date. APTA will meet with CMS to discuss implementation, and will share details with members over the coming months.
  • PQRS, value-based modifiers, and electronic health records meaningful use may be consolidated into a single new quality program These quality programs stay in place for now, but prepare for MIPS—the Merit-Based Incentive Payment System—set to be launched in the future. MIPS will evaluate performance according to quality, resource use, meaningful use, and clinical practice improvement. There are still many details that need to be worked out in terms of the reach of these programs in the future.
  • Participation in alternative payment models (APMs) could be a rewarding experience. CMS will offer 5% bonuses to PTs and other health care professionals involved in APMs such as accountable care organizations, medical homes, and bundled care systems. Beginning in 2026, CMS will stratify annual updates, providing a .75% annual update to health care professionals engaged in APMs, and .25% for those who aren’t.
  • Other changes in the new law include the establishment of a 1% payment update factor for postacute care providers, the inclusion of physician assistants, nurse practitioners, and nurse clinical specialists as professionals qualified to provide documentation for certain types of durable medical equipment, and requirements that Medicare administrative contractors (MACs) provide ongoing outreach, education, training, and technical assistance to providers.

If you haven’t already, please sign up to attend our PT Day on Capitol Hill on June 3-4, 2015 in Washington, D.C. We already have nearly 800 APTA members signed up to attend, but we still have room for more. We will be advocating on behalf of issues such as the repeal of the Therapy Cap and several others. Click here to sign up to take part in this historic event.

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