2007 Medicare Part B Utilization Report Released
RTI International recently released its 2007 Medicare Part B Utilization Report. In 2007, RTI was hired by the Centers for Medicare & Medicaid Services to conduct a research project titled “Developing Outpatient Therapy Payment Alternatives” (DOTPA). The purposes of this project are to identify, collect, and analyze therapy-related information tied to beneficiary need and the effectiveness of outpatient therapy services. The ultimate goal is to develop payment method alternatives to the current financial cap on outpatient therapy services.
The purpose of this report is to provide a high-level analysis of the utilization of and expenditures for outpatient therapy services in CY 2007.
- Medicare expenditures for outpatient therapy were over $4.3 billion in CY 2007. This represents a 6.6% increase from CY 2006. Almost three-quarters (74%) of the CY 2007 expenditures were for physical therapy (PT), followed by 19% for occupational therapy (OT) and 7% for speech-language pathology (SLP).
- PT users were on average younger than OT and SLP users. Mean expenditures per user increased with the age of the beneficiary. Overall, average per user expenditures increased from $934 in 2006 to $994 in 2007.
- Similar to patterns found in 2006 and earlier years, outpatient therapy users in 2007 were disproportionately female. While 56% of Medicare fee-for-service beneficiaries were female, almost two-thirds of outpatient therapy users were female.
- Medicare expenditures for outpatient therapy varied considerably across different states, which could reflect regional differences in supply of therapy providers, regional differences in practice patterns, or regional differences in the case mix of patients.
- The distribution of the settings providing outpatient therapy has shifted in the last few years away from facilities (hospitals, etc.) and physician offices toward therapists in private practice (PTPPs and OTPPs). From 2006 to 2007, there was more than a 16% decrease in the number of comprehensive outpatient rehabilitation facilities (CORFs)and home healthcare agency (HHA) facilities, while the number of PTPPs and OTPPs increased by 8%.
- Facility settings still account for the greater proportion of outpatient therapy expenditures, with skilled nursing facilities (SNFs) accounting for almost one third of payments in 2007. The demographic characteristic differing most by setting is age, with older patients, who have higher therapy expenditures on average, being more likely to be treated in facility-based settings. The distributions of these therapy expenditures across settings were fairly similar in both 2006 and 2007.
- More than 80% of outpatient therapy users received only one type of therapy (PT, OT, or SLP) in 2007. Therapy users seen in SNFs and CORFs were the most likely to receive two or more types of therapy in the year.
- Almost 95% of all outpatient therapy claim lines and Medicare payments in both CY 2006 and CY 2007 were represented by just 15 Healthcare Common Procedure Coding System (HCPCS) codes1. The specific services comprising the top-15 varied across settings.
- When comparing outpatient therapy episodes by the 20 most common primary diagnoses, there were important differences in the average number of treatment days and the average Medicare expenditures. Comparing episodes across setting types, the longest and most expensive outpatient therapy episodes (for all three therapy types) occurred in SNFs, CORFs, and outpatient rehabilitation facilities.
View the report it is entirety here.
1. “HCPCS is a standardized coding system for claims processing used by Medicare and other insurers primarily to identify products, supplies, and services not included in the CPT codes. See http://www.cms.hhs.gov/MedHCPCSGeninfo/”.