Fired Up

Each year I need 10 hours of continuing education. In the past, this was never an issue. I love attending conferences and seminars and with the added benefit of my company paying for courses, I usually over exceeded the requirements. Not so since having kids. Since I don’t have part or full-time status with an employer I pay for everything out-of-pocket, including my yearly licensing and certification fees. This has made it challenging and I am usually found cramming in online courses the month before I need to have the hours completed. So, when a course was coming to Boise in April, a whole 3 weeks before I needed my hours completed, I bit the bullet, paid for the course, and the childcare so I could attend.

Unfortunately, the topic was to be dry. The course was titled, Documenting Medical Necessity: A How-To Guide for Smart Rehab Claims. Have you already fallen asleep? Much to my surprise this was an excellent course. The instructor, Shelly Mesure, MS, ORT/L (occupational therapist), was well versed and knowledgeable about all that is happening in the rehabilitation world in regards to Medicare and healthcare reform. This is a hot topic for our country now and it ended up being very timely to attend this course when I did.

However, it was also extremely sobering to learn the direction that Medicare is headed. I would like to share some of the insights from the course in hopes that you gain perspective for what Medicare is requiring of medical providers and how this impacts the way you are treated. This will specifically focus on rehabilitation services (physical, occupational, and speech therapy) but applies to any medical setting (hospital, outpatient, nursing home, etc). If you don’t want to hear me on my soap box, skip to the end where I actually make my point!

Here goes.

Before 1997, therapists treated patients by completing an evaluation and seeing the patient as long as needed to achieve as close to pre-injury condition as possible. For example, Joe Schmo, had a stroke. He needed physical, occupational, and speech therapy services. He received therapy in a nursing home for five months. Some days he was in pain or didn’t feel well, so he only tolerated 1 hour of therapy. Other days, he could tolerate up to four, even five hours of therapy. The therapists saw him for as little or much as he could handle until Joe was better. He wasn’t the same as before but he knew how to get along well enough. He discharged home.

In 1997, Medicare enacted a Prospective Payment System (PPS) under the Balanced Budget Act. It was mandated as a strategy to encourage efficiency and discourage unnecessary services. Under PPS, healthcare providers (therapists, doctors, etc) are paid a predetermined sum for each service provided.

Okay. Doesn’t sound terrible, right? The catch is that in order for this system to work, someone needs to regulate it and check to make sure that what is billed is the service that was provided. For example, in speech therapy, let’s say I treated Plain Jane for problems with word finding/talking (aka aphasia). I bill that under a certain code: 92507 Treatment of Speech and Language. If I accidentally billed under code 92508 Group Treatment, this would be incorrect and therefore subject to denial of reimbursement for services. Fair enough. Now, I can always correct the error and then Medicare will reimburse. This is called an appeal. But I’m getting away from my point let me go back.


In order for Medicare to determine unnecessary services they generated a list of proper and improper terminology to use. If the incorrect terminology is used the claim is denied. This all falls under the fact that these services are what we call “skilled.” A skilled service is one that is required by someone with specialty training. For example, I am a speech therapist and can diagnose the difference between aphasia (word finding problems), apraxia (motor programming problem-think message from the brain), and dysarthria (weakness). I also know different treatment techniques to target each impairment.

If I wrote the following sentence on my daily note for Joe Schmo, Medicare would deny payment:

“Patient’s speaking improved at the conversational level.”

This statement would be acceptable:

“The patient’s word finding skills increased from 50% to 60% at the conversational with the use of a circumlocution and pacing as compensatory strategies.”

The difference is that I used skilled terminology.

NOT  speaking  BUT word finding

NOT improved BUT increased, 50%/60%, circumlocution, pacing, compensatory strategies

This is a good thing. The bottom line is that in order to show progress something needs to be measurable. I am also a skilled therapist and need to use skilled terminology. But, what has happened is a game of cat and mouse. Medicare decides that certain terms are acceptable/unacceptable one year but they can change without notice.

Maintenance, plateau, monitor, endurance, and confusion are all terms that, if used, are likely to get denied. Instead, we’re required to use independent carryover, maximum functional potential, measured, tolerated, and decreased cognition. 

Absolutely no guidelines are given on Medicare’s part. The clinics start to notice certain claims being denied which contain particular wording so that term is then avoided…so on and so on. This time spent on, let’s call it “creative writing,” is a waste.

SECOND, stay with me here…

To hold healthcare providers accountable for what they bill, Medicare started requiring medical manual reviews (MMR’s). A medical manual review is performed by what’s called a Medicare Administrative Contractor (MAC) or a Recovery Audit Contractors (RAC); otherwise known as MAC’s and RAC’s.

MAC’s and RAC’s can review a medical chart up to three years old to find errors. Grounds for denial can be anything from a missing date to incorrect terminology (mind you, Medicare’s terminology; not what therapists have determined to be incorrect).When an error is found either no reimbursement is provided or, if they had already been paid, the facility is fined. The facility then has the opportunity to appeal the decision, correct the error, and re-submit for reimbursement.

One might ask who are these MAC’s and RAC’s? Well, there’s really no clear answer. What is known about them is that they don’t necessarily have a medical background. Maybe some do, maybe some are therapists, maybe some are people hired off the street. I’m not joking. Medicare is not required to provide transparency in this matter.

MAC’s and RAC’s are given a set of guidelines to follow and even then vary tremendously in final decision-making. What one MAC might approve another might deny. Furthermore, RAC’s are independent contractors and get paid a commission of 9 to 12% depending on the number of denials they generate. So, they might come to a facility and complete audits in fines totaling $150,000 and leave. They get paid their commission and move on. Then let’s say the facility appeals many of these denials. The appeals are approved and they win reimbursement for $130,000. Who pays? Medicare! Not the RACS’s. Why is Medicare paying for these RAC’s when they have to then pay for appeals that are won? I know you are smart enough to figure it out. Think casinos.

THRID…and last point. If you’re still with me, thank you!

As of January 1, 2013, (think Fiscal Cliff) Medicare began applying Multiple Procedure Payment Reductions (MPPR). A MPPR is applied when more than one procedure is provided to the same patient on the same day.

For example, on one given day Joe Schmo received physical therapy for walking (aka gait training), balance, and strength. Each of these is considered a procedure and billed as a separate unit. For simplicity, lets say a total of three units were billed by physical therapy that day. 

As part of the Jan 1st, 2013 American Tax Payer Relief Act, 50% reductions are being placed when more than one unit is billed. This is on top of 2% reductions across the board. If gait training was reimbursable for $30, balance for $20, and strength for $20, taking the 2% reductions into consideration, there should be a $68.60 reimbursement. Under the new cuts, $29.90 would be received for gait training and $4.90 each for balance and strengthening. Instead of a $68.60 reimbursement, the facility will receive $39.70. 

This will put rehabilitation facilities out of business. Plain and simple. In a society of aging Baby Boomers, there will be no rehabilitative settings when these individuals become sick. My guts turn just thinking about it. This will be my parents. Eventually myself.


The true tragedy in all of this is that the patient loses. That is you. Therapists are spending valuable time keeping track of “proper” terminology which negatively-and directly-impacts patient care. Facilities are placing extreme pressure on therapists to “get the minutes in” or the facility won’t get reimbursed; and even if we don’t want it to, we as therapists are changing the way we treat due to these requirements. Despite our best efforts we have to cater to the insurance companies as the bottom line is money. And now, Medicare is cutting reimbursement further, by 50% in the case of rehabilitation services, a move that will assuredly put good standing rehabilitation centers out of business. And to pour salt on the wound this a system we spend our lives paying into.

I entered into this career to help people, as did most other therapists. Health insurance companies are in it for the money; not to heal the sick individual. What it has become is a frenzy of keeping up with requirements put into place by health insurance companies who don’t necessarily have the best interest of the patient in mind. I believe this system is setting us up for failure and unless we stand up as a collective group and demand changes, we as a society are headed for very dark days in caring for the sick.

What’s the answer? I’m sorry friend, I don’t have the answer. But the first step is to declare war against the deceitful and dishonorable acts of health insurance companies.


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