Orthopedic Coding Alert

Cap exceptions go fully automatic this year

As many orthopedic practices know, the -therapy cap- limits Medicare beneficiaries to a combined physical therapy (PT) and speech language pathology (SLP) maximum of $1,780 in annual benefits. Medicare patients face a separate $1,780 cap for occupational therapy (OT) services as well. But that's not where the changes stop. Get to know these important highlights from the latest exceptions process procedures.

1. Cap Amount Bumps Up
 
Unlike last year, when the cap amount was $1,740, you-ll notice that the therapy cap amount increased to $1,780 this year. The 20 percent coinsurance still applies, requiring you to bill the 20 percent balance to secondary insurance or hold the beneficiary responsible for it.

The beneficiary exhausts the cap when the physician fee schedule's allowed amounts are applied to all therapy claims submitted for each respective cap.
Once the limit is reached, however, the patient may qualify for an automatic exception.

2. Get to Know Automatic Exceptions Process

CMS previously allowed PT providers to apply for a manual exception to the cap, or to be subject to an automatic exception. But on Dec. 29, 2006, CMS released Transmittal 1145 mandating that the exceptions process would now be -entirely automatic- starting Jan. 1, 2007.

If the therapist truly thinks a patient requires further skilled therapy and that the patient will be able to show significant improvements, you no longer have to go through all the work of submitting records, writing a justification letter, etc., as part of a manual exceptions process. Now, your documentation will just have to justify the condition that qualifies for exceptions.

3. Automatic-Only Could Be Temporary

The reason CMS nixed this manual exceptions process this year is that not many therapy providers appeared to be using it. If the agency finds that therapists really need the manual process, however, CMS might bring it back.

4. Determine Which Conditions Qualify for Exception

CMS will allow automatic exceptions for certain conditions or complexities without a written request. Following is a sampling of diagnoses that will automatically warrant exceptions:

- Joint replacement (V43.61-V43.69)

- Aftercare for healing pathologic or traumatic fracture (V54.10-V54.29)

- Contracture of joint; multiple sites (718.49)

- Difficulty in walking (719.7)

- Gait abnormality (781.2)

- Lack of coordination (781.3)

- Vertebral column fractures (806.00-806.9)

- Clavicle fracture (810.11-810.13)

- Scapula fracture (811.00-811.19)

- Humerus fracture (812.00-812.59)

- Radius/ulna fracture (813.00-813.93)

- Fracture of femur neck (820.00-820.9)

- Dislocations (830.0-839.9).
 
When you submit claims for services that qualify for the cap exception, you should append modifier KX (Specific required documentation on file) to the procedure codes. This modifier tells the contractor that the services provided qualify for an automatic exception, and it represents the provider-s/supplier's attestation of medical necessity of the therapy services.

5. Make Sure Patient Meets Code Requirements

Even if your patient's diagnosis qualifies for an automatic exception, you shouldn't automatically append KX to exceed the cap. You should only use the modifier when your documentation strongly demonstrates medical necessity for the exception. CMS notes that contractors will be monitoring whether practices are overusing modifier KX.

According to CMS Transmittal 1145, -Regardless of the condition, the patient must also meet other requirements for coverage. For example, the patient must require skilled treatment for a covered, medically necessary service; the services must be appropriate in type, frequency and duration for the patient's condition; and services must be documented appropriately.-

In other words: Your patient must meet all of the requirements for that service according to your carrier's guidelines, whether or not he has a diagnosis on the list.

-For example,- the transmittal notes, -if the condition underlying the reason for therapy is V43.64, hip replacement, the treatment may have a goal to ambulate 60- with stand-by assistance and a KX modifier may be appropriate for gait training (assuming the severity of the patient is such that the services exceed the cap). Alternatively, it would not be appropriate to use the KX modifier for a patient who recovered from hip replacement last year and is being treated this year for a sprain that is not represented on the list as an exception and for which extensive therapy exceeding caps is not justified.-

Note: To read the full list of diagnoses that allow automatic exceptions, visit the CMS Web site at www.cms.hhs.gov/transmittals/downloads/R1145CP.pdf, or contact the editor, Torrey Kim (919-924-2833 or by e-mail at torrey@medville.com), to have the list e-mailed or faxed to you.