Have Your Cake and Eat It Too? Not so fast…. the ABN rules have changed for 2013 Therapy
Have you been issuing a blanket ABN notice to therapy outpatients when they reach the $1900 therapy cap ($1900 for physical therapy and speech therapy combined, and another $1900 for occupational therapy) wherein the patient accepts financial responsibility for therapy if CMS deems it is not medically necessary?
Last year’s advice from CMS to the therapy community was just the opposite of the advice this year based upon the statutory change in beneficiary liability for therapy over the cap resulting from the American Taxpayer Relief Act (ATRA). Last year CMS advised therapy providers to issue the voluntary form of the ABN to beneficiaries as a courtesy to let them know that therapy of the cap was statutorily excluded as a Medicare benefit. The beneficiary was liable, even in the absence of an ABN. CMS in fact sent over 500,000 letters last August to beneficiaries advising of the statutory exclusion of therapy over the caps, and advising them of their liability.
It became old hat for therapy providers to routinely issue a voluntary ABN to every patient nearing the therapy cap. The therapy provider was able to have it both ways (sort of a “have your cake and eat it too”). Therapy claims over the therapy cap were submitted with the KX modifier (attesting to medical necessity). If the claim was reviewed and denied, then the beneficiary would be held liable. A seemingly perfect world….. that has now come to a screeching halt as the CMS guidance this year is dramatically different as a result of the new law removing beneficiary liability for therapy that is over the $1900 caps. Actually it came to a screeching halt on January 1, 2013, only many rehab providers are finally getting the message.
In an FAQ document posted to the therapy services page, CMS has issued long awaited guidance to the therapy industry on the proper use of the Advanced Beneficiary Notice of Non-Coverage (ABN) for therapy exceeding the cap. According to CMS “Section 603 (c) of the ATRA amended §1833(g)(5) of the Social Security Act (the Act) to provide limitation of liability (LOL) protections (See §1879 of the Act) to beneficiaries receiving outpatient therapy services on or after January 1, 2013, when services are denied and the services provided are in excess of therapy cap amounts and don’t qualify for a therapy cap exception. Now, the provider/supplier must issue a valid, mandatory ABN to the beneficiary before providing services above the cap when the therapy coverage exceptions process isn’t applicable.”
So how does this work for therapy over the $1900 Cap in 2013? If a patient is receiving therapy and about to exceed the $1900 therapy cap, and the therapist feels that continued therapy is medically necessary, a KX modifier is used to attest to medical necessity. The KX modifier allows the claim to pass through the Common Working File and to be processed for payment. If the therapist feels at any time during the course of therapy (before and after the therapy cap) that therapy is no longer medically necessary it is appropriate to discuss discharge options with the patient, including continued therapy. In this instance, since continued therapy is not medically necessary, and the patient requests additional therapy, a mandatory ABN is issued prior to providing services. Claims over the $1900 therapy caps that are processed with the GA modifier (indicating therapy is not medically necessary per payer policy), by definition may not also utilize the KX modifier. In 2013, you cannot have your cake and eat it too.
In light of the fact that all claims over the $3700 therapy threshold are subject to manual medical review by the Recovery Auditors (RACs), it is important for providers who feel that have protected themselves with last years’ guidance, including the use of the voluntary ABN, may be surprised to learn that they be held liable for all denied services.
Check with your Medicare contractor for webinars and courses on the use of the Advanced Beneficiary Notice. (Noridian has posted ABN instructions along with a tutorial on their website). Information on the ABN and the form and form instructions can be downloaded from http://cms.gov/Medicare/Medicare-General-Information/BNI/index.html.
Editors Note: A similar version is being published at http://www.racmonitor.com