Rehab Sees Cuts to Therapy Payments in 2021

In late December of 2020, President Trump signed the voluminous 2021 tax and spending bill into law, resulting in reduced funding to specialty providers, including physical, occupational, and speech therapists.

At one point, the bill threatened an approximate 9 percent cut to Medicare therapy payments, but after months of advocacy from organizations such as the American Physical Therapy Association (APTA) and the Alliance for Physical Therapy Quality and Innovation (APTQI), those cuts settled at about 3.6 percent for physical and occupational therapists, and 5.5 percent for speech therapists. 

"Making cuts to health care providers during a global pandemic is a bad health care policy," said Justin Elliott, vice president of government affairs, APTA. "Many of the 20 million individuals who have tested positive for COVID-19 will require physical therapy services as part of their recovery. Now is not the time to limit access to these essential services."

Elliot said that for therapists who are already struggling economically due to the impact of COVID-19, these cuts could not come at a worse time.

"There is great concern about how these cuts will reduce critical health services in rural and underserved areas," he said. "These cuts also make clear that the Medicare Physician Fee Schedule needs reform. First developed in 1992, the Medicare Physician Fee Schedule fails to adequately support or recognize a modern health care delivery system in which multiple health care professionals work collaboratively to advance appropriate health outcomes for their patients."

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A press statement from the APTQI on December 22, 2020, commended lawmakers in Congress for passing legislation that eased the funding cuts.

"The funding bill mitigates cuts to more than 30 health care specialties included in the Medicare PFS Final Rule, which Medicare finalized despite opposition from a broad coalition of health care stakeholders, patients, and lawmakers from both parties," said the press release. "While Congress was unable to fully eliminate the specialty cut, their decision to ease the Medicare cuts in 2021 will help ensure patients' continued access to vital services during the ongoing COVID-19 pandemic."

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Rehab Sees Cuts to Therapy Payments in 2021

3 things that therapy providers should know about the funding cuts

Elliot highlighted three critical aspects that therapy providers should know about these reduced payments for 2021:

1. The funding cuts impact Medicare Part B and do not impact Part A billing; 
2. The reduction for physical therapy and occupational therapy providers is an estimated 3.6 percent (with up to 5.5 percent cuts in speech therapy), but actual amounts will vary depending on billing patterns and patient population. CMS is in the process of implementing the policy provisions included in the legislation and APTA anticipates that CMA will release information about the changes to 2021 Medicare payment rates through program instructions, a correction notice in the federal register, and/or other guidance. This will further clarify the actual impact on health care providers.
3. "The fight is not over," noted Elliott, vowing that APTA will continue advocacy in 2021 to mitigate these cuts.

"APTA will continue to work with our coalition partners to seek additional relief from the cuts," Elliot said. "This week, the 117th U.S. Congress was sworn in, and APTA will be working with our Congressional champions on possible policy options to further mitigate these cuts — so stay tuned."

APTA's #FightTheCut campaign over the past year was critical in getting Congress to intervene and mitigate CMS's proposed cuts.

"The presence of any relief from the cuts was brought about in large part due to intense advocacy by APTA and our coalition partners," said Elliot, adding that their efforts were supported by large groups of bipartisan lawmakers in both chambers of Congress. "APTA membership and APTA's PT-PAC support helped ensure that our voice was heard on Capitol Hill."

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