AOTA Summary: Medicare Fee Schedule Final Rule for CY2014

Jennifer Hitchon, JD, MHA

The final Medicare Physician Fee Schedule Rule updating outpatient payment regulations for CY 2014 has been released by the Centers for Medicare & Medicaid Services (CMS) (72 Federal Register 74230 [December 10, 2013]), and the policies are scheduled to take effect on January 1, 2014. AOTA submitted extensive comments responsive to the proposed rule issued in July 2013. CMS responded directly to our comments, as well as the comments of other stakeholders, in the preamble to the final rule. Here, AOTA outlines key provisions in the final rule that will impact practitioners of occupational therapy.

The Outpatient Therapy Cap

The Medicare Economic Index (MEI) is used to determine the outpatient therapy cap amount for every calendar year. As announced in the final rule, the therapy cap amount for CY 2014 is $1,920 for occupational therapy and $1,900 for physical therapy and speech-language pathology, combined (an increase from the 2013 level of $1,900). The exceptions process to the therapy cap expires December 31, 2013, but AOTA is working on legislation to repeal the therapy cap, which includes an extension of the exceptions process until such time as the cap is permanently repealed.

Extension of the Outpatient Therapy Cap to CAHs

AOTA opposed CMS' proposal to extend the therapy cap and concomitant policies to critical access hospitals (CAHs). CMS moved forward with its proposal and has applied the therapy cap and other therapy provisions to CAHs, saying "We agree with commenters that CAHs provide important access to medically necessary therapy services for Medicare beneficiaries; however, we do not believe that application of the therapy caps and related policies to services furnished by CAHs will lead to significant new impediments for Medicare beneficiaries." (72 Fed. Reg. 74230, 74409.)

Manual Medical Review (MMR)

In our comment letter, we made the case that RAC involvement in MMR is unlawful and inappropriate and should be halted. CMS did not propose changes to MMR in the proposed rule, and none were subsequently finalized. 

Multiple Procedure Payment Reduction

AOTA reiterated the organization’s opposition to the MPPR for therapy and required discipline-specific application. CMS did not propose changes to the MPPR in the proposed rule and did not make any revisions in the final rule.

Functional Reporting

CMS did not propose changes to the claims-based functional data collection process, but AOTA requested that a Technical Expert Panel (TEP) be convened to review the G-codes and modifiers. In addition, we asked for an expansion of the G-code categories to better reflect the practice of occupational therapy. There were no modifications made to the process in the final rule, and it will continue unchanged in 2014. 


AOTA's comment letter supported CMS' proposal not to remove the telehealth frequency limitation for subsequent nursing facility services (CPT codes 99307-99310). CMS finalized its plan to maintain the limit, citing our letter as support:

Comment: A commenter supported our decision not to remove the telehealth frequency limitation for subsequent nursing facility services reported by CPT codes 99307 through 99310. The commenter noted that telehealth occupational therapy services are just beginning to be provided and evaluated, and indicated that it is important to ensure that care for the acute and complex patients found in SNFs is not compromised, regardless of the mode used to provide services. 

. . .

Response: We appreciate the comment in support of maintaining the 30-day limit. Commenters opposed to the 30-day limit offered no clinically persuasive evidence to support their positions... (pp. 74404-5.)

Complex Chronic Care Management (CCCM) Services

CMS proposed new payments for CCCM services for a narrow set of providers in certain settings, and AOTA argued in our letter that the provider set should be expanded to include appropriate non-physicians, such as occupational therapy practitioners, and be applied to all settings, including facilities such as skilled nursing facilities (SNFs). CMS acknowledged our comment, but declined to make changes for next calendar year, stating:

Other commenters suggested CMS give more consideration to therapy services, medication management, discharge planning, care coordination, and caregiver education... Commenters conveyed individuals with Alzheimer’s and dementias may not be able to participate in the development of a care plan in the same capacity as individuals who are not cognitively impaired...

Response: We appreciate commenters’ suggestions and will consider these comments for any future rulemaking on this topic. (p. 74420.)

Capping Payment Rates

CMS proposed capping payment rates for certain non-facility service codes at the rates paid to ambulatory surgery centers (ASCs) and rates under the hospital outpatient prospective payment system (HOPPS). AOTA opposed this proposal in our comment letter, and CMS has subsequently declined to finalize it. The agency did say in the preamble to the final rule, however, that they would "develop a revised proposal for using OPPS and ASC rates in developing PE RVUs which we will propose through future notice and comment rulemaking." (p. 74248.)

Physician Quality Reporting System (PQRS)

AOTA requested CMS add more measures relevant to the practice of occupational therapy and expressed concern at the proposed expansion of reporting requirements, urged the agency to consider a delay in plans to eliminate claims-based reporting as well as a delay in penalties, and asked for an extension of reporting eligibility to occupational therapists in facility settings. CMS is moving forward with plans to apply penalties for unsatisfactory reporting beginning in CY 2015 (based on CY 2013 reporting data), to allow eligible providers (including occupational therapy practitioners in private practice) to satisfy PQRS reporting requirements by using a registry. CMS is also increasing the requirement from 3 measures to 9 measures for those reporting via registry or EHR, and easing the reporting threshold from 90% of applicable patients to 50%. CMS did not respond directly to our specific comments about more discipline-specific measures and eligibility for facilities or about allow occupational therapists to report on PQRS Measure 182 (“Functional Outcome Assessment”). AOTA policy staff continue to work with the measure develop and CMS to ensure occupational therapists can report on this measure.

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 Jennifer Hitchon, JD, MHA, is Counsel & Director of Regulatory Affairs (