You manage everybody else’s pain, but what to do about the pain of billing to Medicare? It helps to understand the 8-Minute Rule.
If you have a practice, you probably know all about the 8-Minute Rule, but knowing about something and understanding it can be two different things.
But it’s important to understand it — or work with somebody who understands it — so you can bill properly and not end up being paid less than you should be earning.
So if you’re looking for a quick tutorial on what is the current procedure for billing physical therapy services to Medicare, here it is.
Some lingo it would be helpful to familiarize yourself with, to understand the 8-Minute Rule.
CPT codes. CPT stands for “current procedural terminology.” These codes are used to identify medical services and procedures. For instance, 97110 is a CPT for therapeutic exercise, 97140 is for manual therapy, 97150 is for group therapy. The codes are designed by the American Medical Association. While they can be a headache for anybody new to the world of billing for medical services, they are designed to make the process easier and consistent.
HCPCS codes. HCPCS is the coding system used by Medicare. Some of its codes — what’s called Level 1 HCPCS codes — are the same as the American Medical Association’s CPT codes. Medicare also has HCPCS Level II codes that are different — generally, those are supplies and services that, for the purpose of this blog post, we don’t need to get into. If you would be billing for an oxygen tent, for instance, the code would be E0455.
ICD-10 codes. These are codes developed by the World Health Organization (WHO). They describe a patient’s health condition. For instance, somebody who is obese might have the code EGG.0, or somebody with a sprained ankle could be given the code S93.4.
Units. In the world of billing codes and physical therapy, it’s a measurement of 15 minutes. You’ll see why this is important later.
Why CPT codes and knowing the right codes, in general, are important.
It’s obvious, and so we won’t insult your intelligence by taking a lot of time to explain it. If you don’t have the right billing codes and understand how they’re used, you could end up billing insurers incorrectly. It won’t help your practice to receive less than you earned — and it also won’t help matters to bill more than you’re entitled and have an insurer discover that later. But even PTs who understand billing coding can find themselves underbilling, which is why it’s so important to understand the 8-Minute Rule.
Yes, the 8-Minute Rule that you’ve mentioned earlier. What is the 8-Minute Rule?
It’s the rule that physical therapists and physical therapy practices need to follow when billing physical therapy services to Medicare, Medicaid, and other federal payers. The 8-Minute Rule defines direct contact therapeutic services that last for at least eight minutes — between a physical therapist and a patient.
As you can imagine, it’s a rule designed to stop fraud and encourage better care. You wouldn’t want a PT believing that you can work with a patient for a minute or two and then bill the insurer a fortune for that. It’s terrible for the insurer, of course, and rotten for the patient.
So everything is billed in eight-minute increments?
No, that would be too easy. Medicine PT billing is handled in increments of 15. The good news is that if you work with a patient one-on-one for eight minutes or 10 minutes, you can bill for one 15-minute unit. If you work with a patient for two eight-minute segments (16 minutes), you’d actually end up billing for one 15-minute unit.
If you work for 23 minutes with a patient, then you’d get to bill for two 15-minute units.
It sounds confusing — and it kind of is — but this little table-list below should help clarify things.
- 8–22 minutes = 1 unit
- 23–37 minutes = 2 units
- 38–52 minutes = 3 units
- 53–67 minutes = 4 units
- 68–82 minutes = 5 units
- 83–97 minutes = 6 units
- 98–112 minutes = 7 units
- 113–127 minutes = 8 units
So if you work with a patient for 22 minutes or less, you’ll bill for one unit. If you do 23 to 37 minutes, 2 units, and so on.
It may look frustrating, but it rewards the patient and the PT when you spend a little more time helping the patient. After all, if you engage with a patient for 16 or 17 minutes, and you end up not being compensated for one or two minutes of work, that’s not going to break your bank (one would hope). But because you probably don’t want to work for free for, say, seven minutes, you would want to try to avoid working for, say, 22 minutes — and try to spend at least one more minute with the patient, so you can bill for two units.
Another factor to consider.
You’re also billing two types of CPT codes, service-based and time-based. Service-based would be something like conducting an exam or for an unattended electrical stimulation. Time-based, again, refers to when you’re working one-on-one. While you can bill for two or more units with time-based services, you only bill one unit per service-based activity. So if your examination takes half an hour, you’re just billing one code and not billing that service in, say, two units.
So how can I make sense of the 8-Minute Rule and billing codes?
Much of it, unfortunately, involves practice — simply doing enough billing and mastering it. But if you become a Hands-On Diagnostics franchise, you’d have the billing software that would automate everything, tracking your time and instituting the 8-Minute Rule for you, so you can have accurate and higher PT insurance reimbursements.
In other words, as we’ve stated more than a few times on this blog, if you team up with Hands-On Diagnostics, we can alleviate your financial migraines and billing suffering — which will give you more time and energy to focus on healing your patients.
We hope you’ll give us a call. It may take a little longer than eight minutes for you to figure out whether you want to be a HODS franchise, but we promise we won’t bill you — in units or otherwise.