[Federal Register: November 2, 1998 (Volume 63, Number 211)]
[Rules and Regulations]
[Page 58863-58912]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr02no98-17]
[[pp. 58863-58912]] Medicare Program; Revisions to Payment Policies and Adjustments
to the Relative Value Units Under the Physician Fee Schedule for
Calendar Year 1999
[[Continued from page 58862]]
[[Page 58863]]
the applicable fee schedule amount will be the amount established for
comparable services as specified by the Secretary. Therefore, we
revised our policy so that the existing fee schedules for prosthetic
and orthotic devices, durable medical equipment, and supplies, and
drugs and biologicals apply when these services are furnished by a
CORF. We believe that these fee schedules, together with the physician
fee schedule, will encompass all CORF services other than nursing
services. The physician fee schedule amount applicable to services
furnished in a nonfacility setting will apply to the services furnished
by the CORF since no separate payment will be made for facility costs.
To establish a fee schedule amount for nursing services delivered
within a CORF, we created a new HCPCS code, G0128. We have defined this
code as direct face-to-face skilled nursing services delivered to a
CORF patient as part of a rehabilitative plan of care. It is a timed
code and can be billed for 10-minute intervals (when the initial
interval is longer than 5 minutes). G0128 is to be used for services
that are not included in the work or practice expense of another
therapy or physician service. An example might be a nurse who spends 33
minutes instructing a patient in the proper procedure of ``in and out''
urethral catheterization; in this situation, 3 units of G0128 would be
billed. We are setting the RVUs for this code at 0.26, based upon half
the value of the lowest level physician follow-up visit, HCPCS code
99211, in the nonfacility setting. This results in a payment that is
slightly more than the average wage reported by the Bureau of Labor
Statistics (BLS) for registered nurses, inflated to reflect benefits
and overhead (using the fringe benefit and expense factor used to
establish the salary equivalency guideline).
Comment: One commenter supported the use of the nonfacility
physician fee schedule for therapy services performed in an SNF and
CORF; however, clarification was requested as to whether the facility
or the nonfacility physician fee schedule will be used for hospital
outpatient departments.
Response: The physician fee schedule payment amount applicable to
outpatient rehabilitation services furnished by hospitals is the same
as that for SNFs, CORFs, and other outpatient rehabilitation providers.
That is, hospitals will be paid for these services under the
nonfacility component of the physician fee schedule.
(5) Site-of-Service Differential
We did not propose a site-of-service differential for providers of
outpatient rehabilitation services as suggested by some of the
providers prior to publication of our proposed rule. That is, we did
not propose a payment amount greater or lesser than that provided by
the physician fee schedule for some of the types of providers or sites
at which outpatient rehabilitation services are furnished.
As explained in our proposed rule, the law requires that these
services be paid the amount determined ``under the fee schedule
established under section 1848.'' Furthermore, we believe higher
payment amounts for certain facilities, such as CORFs or rehabilitation
agencies, would create payment incentives that favor one site or
setting over another. We believe the statute establishes a ``level
playing field'' for these services. We find no directive in the
statutory language or legislative history that we recognize higher
costs that some providers argue might be associated with furnishing
services in a provider setting. To the extent that CORFs or
rehabilitation facilities provide services to patients who need
additional care, CORFs or rehabilitation facilities may bill for
additional, medically necessary services. For these reasons, we are not
revising our policy to allow for a site of service adjustment or higher
payment amount for specific settings.
Comment: One commenter believes the work RVU should be the same
regardless of setting; however, the commenter contends that the
practice expense component may differ among the settings. The commenter
states that the impact of any unique regulatory requirements among
settings on the cost of furnishing services should be determined.
Response: As stated above, we find no statutory or legislative
basis for recognizing a distinct payment differential that is site
specific. Therefore, we are not revising our policy to allow for a
payment differential among settings.
(6) Mandatory Assignment
Section 1834(k)(6) of the Act, as added by BBA, establishes a
restraint on billing for outpatient rehabilitation therapy services;
that is, this provision requires that services paid under section
1834(k) of the Act are subject to mandatory assignment under the same
terms applicable to practitioners under section 1842(b)(18) of the Act.
Therefore, we have revised our policy in accordance with this provision
to require mandatory assignment for services provided under the
outpatient rehabilitation prospective payment system by hospitals,
SNFs, HHAs, rehabilitation agencies, public health agencies, clinics,
and CORFs. The mandatory assignment provision does not apply to therapy
services furnished by a physician or ``incident to'' a physician's
service or to services furnished by a physical therapist in private
practice or an occupational therapist in private practice. However,
when these services are not furnished on an assignment-related basis,
the limiting charge applies.
2. Uniform Procedure Codes for Outpatient Rehabilitation Services
Section 4541(a)(2) of BBA added section 1834(k)(5) to the Act. This
new statutory provision requires that claims submitted on or after
April 1, 1998 for outpatient physical therapy services, including
speech language pathology services and outpatient occupational therapy
services, include a code under a uniform coding system that identifies
the services furnished.
The uniform coding requirement is needed to ensure proper payment
under the physician fee schedule. Hospitals, SNFs, HHAs (for
individuals who are not eligible for home health services), CORFs, and
outpatient physical therapy providers must use HCPCS codes to report
outpatient rehabilitation services when furnished to their outpatients.
Hospitals and SNFs that provide outpatient rehabilitation services to
their inpatients who are entitled to benefits under Part A but who have
exhausted their benefits for inpatient services during a spell of
illness or to their inpatients who are not entitled to benefits under
Part A are also required to report HCPCS codes.
In March, 1998, we issued Program Memorandum AB-98-8 which
describes the coding for outpatient rehabilitation services and
identifies certain HCPCS codes available for billing by CORFs that are
not generally rehabilitation services, including vaccinations and
nursing services. This memorandum also specifies how these codes will
be reported on the UB-92. We assigned the various codes to revenue
centers, that is, physical therapy, occupational therapy, and speech-
language pathology, for purposes of applying the financial limitation
described below. Assigning codes to revenue centers was not intended to
limit the scope of practice or range of procedures that could be
furnished by therapists in a particular discipline. We recognize that
many therapy services, for example, physical therapy
[[Page 58864]]
modalities or therapy procedures as described by HCPCS codes are
commonly delivered by both physical and occupational therapists. Other
services may be delivered by either occupational therapists or speech-
language pathologists.
Therefore, in July 1998, we issued PM A-98-24 which in effect
constituted a reissuance of PM A-98-8 in its entirety. PM A-98-24 was
intended, in part, to clarify PM AB-98-8 regarding the reporting of
HCPCS codes for outpatient rehabilitation and CORF services and to
instruct fiscal intermediaries to eliminate edits installed to match
revenue centers to outpatient rehabilitation HCPCS codes in order to
cap therapy services. HCFA did not intend for such edits to be
installed and employed. Thus, PM A-98-24 instructed fiscal
intermediaries to eliminate the edits for services furnished on or
after October 1, 1998. However, in response to industry concerns, on
August 6, 1998, we issued a memorandum to all fiscal intermediaries
advising them to remove immediately any coding edits imposed to match
outpatient rehabilitation HCPCS codes to revenue codes.
Comment: We received three comments regarding PM A-98-24 issued
July 1998. The commenters stated that confusion remains regarding the
effective date of the memorandum. Also, they urged that we instruct
carriers to not deny claims based on the practitioners' failure to
comply with coding requirements until there is a clarification
regarding the manner in which the coding requirement is to be
implemented. One commenter recommended that fiscal intermediaries be
required to adhere to revised PM A-98-24, effective immediately. The
commenter contended that claims wrongly denied based on PM AB-98-8
should be promptly paid based on the claims originally submitted by
providers.
Response: We apologize for the confusion. As noted above, PM A-98-
24 carried an effective date of October 1, 1998 for fiscal
intermediaries to remove any edits installed to match revenue center to
HCPCS coding for outpatient rehabilitation services. As also stated
above, on August 6, 1998 we issued a subsequent memorandum to all
intermediaries advising them to remove the edits immediately. Providers
and practitioners were encouraged to resubmit any claims that were
incorrectly denied due to misinterpretation of our instructions for
billing outpatient rehabilitation services using HCPCS codes.
Comment: We received one comment recommending that the definition
of outpatient rehabilitation services be expanded to include payment
for low-vision training. The commenter stated that Medicare's failure
to cover low-vision training places beneficiaries at risk for extreme
out-of-pocket expenditures for transportation services, home-bound
visits, and psychological counseling.
Response: We have not accepted the commenter's recommendation.
Outpatient rehabilitation services are clearly defined in the statute.
Low-vision training is not specifically mentioned in the statute, and
we find no statutory or legislative basis for including low-vision
training in the definition of outpatient rehabilitation services.
Therefore, we cannot arbitrarily expand our definition of outpatient
rehabilitation to encompass low-vision training.
Since the statute does not specifically identify low-vision
training as a separate Medicare benefit and does not provide a basis
for including it under the outpatient rehabilitation benefit, carriers
have the discretion to cover these low-vision training services if they
determine that they meet the statutory requirements applicable to
covered services and are determined to be medically reasonable and
necessary.
Comment: A commenter recommends that CPT codes 92520, 94799, and
psychiatric therapeutic codes after 90804 be added to the list of
outpatient rehabilitation services. The commenter stated that code
94799 is currently recognized by Blue Cross and Blue Shield of Florida.
The commenter also stated that, in addition to code 90804, other
psychiatric therapeutic codes should be added for assessments and
community resource education, referral and advocacy, family
conferences, and home assessments.
Response: The commenter asked that we add code 92520, laryngeal
function studies, to our list of outpatient therapy codes. Our data
show that this code is almost entirely billed by otolaryngologists. Our
standard for the inclusion of diagnostic tests as outpatient
rehabilitation services is as follows:
<bullet> If the primary purpose of a diagnostic test, at times
performed by therapists, is to assess the appropriateness or
effectiveness of outpatient therapy services or to guide additional
treatment by a physical therapist, an occupational therapist or speech-
language pathologist, then the test is considered to be outpatient
therapy or rehabilitation services; or
<bullet> If the primary purpose of the diagnostic test is to
provide information on decisions for future medical or surgical
treatment or to assess the effect of previous medical or surgical
treatment, then the diagnostic test is not considered to be an
outpatient therapy or rehabilitation service.
Because the purpose of code 92520 is not clear to us and because
our data show that it is performed overwhelmingly by otolaryngologists,
we suggest that providers and practitioners who believe it meets the
above criteria as an outpatient rehabilitation service provide
information to their Medicare contractors and the contractors can
approve it if it meets the coverage criteria of being ``medically
necessary.'' We advised our carriers and fiscal intermediaries in PM
AB-98-24 that they may recognize codes other than those identified in
our instruction as outpatient rehabilitation services to the extent
that the codes represent services that are determined to be medically
necessary and within the scope of practice of the practitioner or
therapist billing the service.
The commenter asked that code 94799, unlisted pulmonary services or
procedures, be added to the list of outpatient rehabilitation services.
Again, we suggest that practitioners and providers that wish to use
this code to describe an outpatient rehabilitation service discuss with
their Medicare contractor the specific services or procedures being
provided when this code is used. Before this code can be used, the
Medicare contractor needs to determine whether the services are
``medically necessary.''
The commenter also asked that we add other psychotherapy codes from
the family of codes that includes 90804 that is on our list of
outpatient rehabilitation services. Clinical psychologists and clinical
social workers who deliver services in CORFs can bill any of the
psychotherapy codes except for the ones that involve medical evaluation
and management. These services are billed under Part B and are
submitted to carriers on the HCFA form 1500. Therefore, these codes
will not be added to our list of outpatient rehabilitation services.
Comment: One commenter recommended adding to our final rule the
statement contained in PM A-98-24 that denotes that other codes may be
considered to represent outpatient rehabilitation services to the
extent that the services are determined to be medically reasonable and
necessary and can be billed as outpatient rehabilitation services.
[[Page 58865]]
Response: Although we have included the statement in the text in
the regulation, we will consider other codes to be outpatient
rehabilitation codes under the terms we have stated.
Comment: One commenter requested that we clarify in the final rule
that Addendum F contains the codes for reporting outpatient
rehabilitation services.
Response: We appreciate the suggestion. It was inaccurately
reported in the proposed rule that Addendum E contains a listing of
outpatient rehabilitation therapy codes. It should have read that
Addendum F contains such a listing. We have made the appropriate
correction in this rule.
3. Financial Limitation
a. Overview. Outpatient rehabilitation therapy services are subject
to annual financial limitations or caps beginning January 1, 1999. (The
amount of the current cap is $900.) There will be a $1,500 per-
beneficiary annual limitation or cap on incurred expenses for
outpatient physical therapy services including outpatient speech-
language pathology services. A separate $1,500 per-beneficiary
limitation will apply on incurred expenses for outpatient occupational
therapy services. The annual limitation does not apply to services
furnished directly or under arrangements by a hospital to an outpatient
or to an inpatient who is not in a covered Part A stay. The limitation
will apply to outpatient rehabilitation services furnished by a
separately-certified hospital-based provider, such as a hospital-based
SNF. The limitation also applies to outpatient rehabilitation services
furnished by a physician or nonphysician practitioner, or incident to a
physician's professional services or to a nonphysician practitioner's
professional services.
As stated above, there is a single $1,500 limitation for outpatient
physical therapy services which includes outpatient speech-language
pathology services. As amended, section 1833(g) of the Act applies a
single $1,500 limitation to ``physical therapy services of the type
described in section 1861(p).'' Section 1861(p) defines outpatient
physical therapy services and includes speech-language pathology
services within that definition.
Outpatient rehabilitation services are subject to a 20-percent
coinsurance amount. Under the outpatient prospective payment system,
the beneficiary will be responsible for 20 percent of the applicable
fee schedule amounts. The $1,500 limitation is on incurred expenses. If
a beneficiary has already satisfied the Part B deductible, the maximum
amount payable by the Medicare program is $1,200, that is, 80 percent
of $1,500. Beginning January 1, 2002, the $1,500 annual limitations or
caps will be increased by the percentage increase in the MEI.
In addition to outpatient physical therapy services and outpatient
occupational therapy services (other than those provided by a
hospital), the limitation applies to physical therapy services
(including speech-language pathology services) and occupational therapy
services ``of such type which are furnished by a physician or as
incident to a physician service.'' As discussed elsewhere in this
document, Medicare covers under certain conditions services performed
by nurse practitioners, clinical nurse specialists, and physician
assistants that would be physicians' services if furnished by a
physician. We are applying the financial limitation to therapy services
furnished by these nonphysician practitioners because such therapy
services are by definition the same type as are furnished by
physicians. Similarly, we have revised our policy to apply the
financial limitation to therapy services furnished incident to these
nonphysician practitioner's services. We have included in Addendum D a
listing of the specific services that are subject to the limitation
when furnished by a physician or practitioner directly or incident to
his or her services. Such outpatient rehabilitation services included
in Addendum D furnished either directly or incident to the services of
a physician or practitioner are always subject to the financial
limitation. Other services such as casting, splinting, and strapping
may be used in the treatment of conditions (for example, fractures or
sprains) or as part of the postsurgical treatment or medical treatment
when no other rehabilitation services are delivered. If the services
are delivered by a physical or occupational therapist, speech-language
pathologist, therapy assistant or therapy aide, are part of a
rehabilitation plan of care, or involve services included in the
aforementioned Addendum D, then the services are subject to the cap.
These outpatient rehabilitation services are delineated in Addendum E
and must be identified with a discipline-specific modifier. Addendum F
contains a listing of commonly-utilized outpatient rehabilitation
therapy codes. Other codes may be considered for payment as outpatient
rehabilitation services to the extent that the services are determined
to be medically reasonable and necessary and those that can be
performed within the scope of practice of the therapist, physician, or
nonphysician practitioner billing the code. Payment for certain HCPCS
codes will be made on a basis other than the physician fee schedule in
hospital outpatient departments. Other HCPCS codes represent CORF
services. Further, PM AB-98-63 dated October 1998 provides additional
program instructions regarding the use of HCPCS codes for outpatient
rehabilitation therapy services.
With regard to ``incident to'' services, we note that section
4541(b) of BBA amended section 1862(a) of the Act to require that
outpatient physical therapy services (including speech-language
pathology services) and outpatient occupational therapy services
furnished ``incident to'' a physician's professional services meet the
standards and conditions (other than any licensing requirement
specified by the Secretary) that apply to therapy services furnished by
a therapist. This provision was effective January 1, 1998 and was
implemented through program instructions.
The financial limitations apply only to items and services
furnished by nonhospital providers and therapists under the outpatient
physical therapy (including speech-language pathology) and the
outpatient occupational therapy benefit (section 1861(s)(2)(D) of the
Act) and therapy services furnished by physicians and nonphysician
practitioners or incident to their services. The limitations do not
apply to diagnostic tests covered under section 1861(s)(3) of the Act
or to items furnished or covered under the durable medical equipment
benefit.
Comment: Some commenters urged us to repeal the limitation.
Response: We have no authority to repeal the annual financial
limitation as set forth in BBA. An annual per beneficiary limit of
$1,500 will apply to all outpatient physical therapy services
(including speech-language pathology services). A separate $1,500 limit
will also apply to all occupational therapy services. As noted above
the annual limitations do not apply to services furnished directly or
under arrangements by a hospital to an outpatient or to an inpatient
who is not in a covered Part A stay. This limitation applies to
expenses incurred on or after January 1, 1999.
Comment: Several commenters want us to delay implementing the
financial limitation while others asked that, if we proceed with
implementation, we clarify how we would implement it. We received one
comment suggesting that we delay the implementation of the annual
limitation until we develop a
[[Page 58866]]
system of tracking the aggregate amount of speech-language pathology
expenses incurred by a beneficiary.
Response: As previously stated, because of our efforts to become
Y2K compliant, with the exception of qualified therapists in
independent practice, we are not able to make the appropriate systems
changes to fully implement the caps on a per-beneficiary basis at this
time. Instead, we will use a transitional measure, whereby providers
and practitioners (those not currently subject to the caps, for
example, physicians and nonphysician practitioners) will be held
accountable for tracking incurred expenses for each beneficiary to
ensure they do not bill Medicare for beneficiaries that have met the
annual $1,500 limitation at their facility for each separate
limitation. This means that SNFs will be directly responsible for the
billing of all outpatient rehabilitation services and the tracking of
incurred expenses of those services when furnished to SNF residents not
in a covered Part A stay and SNF nonresidents receiving outpatient
rehabilitation services from the SNF.
However, the provider and the practitioner may submit bills to
Medicare for the sole purpose of receiving no-pay notices to bill
Medicaid or other insurers.
It is noted that the current annual per beneficiary financial
limitation applied to outpatient physical therapy services including
speech-language pathology services furnished by PTIPs is increased from
$900 to $1,500 effective January 1, 1999 for PTPPs. In addition, the
current annual per beneficiary financial limitation applied to
outpatient occupational therapy services is increased from $900 to
$1,500 effective January 1, 1999 for OTPPs. As cited, for these
qualified therapists only, the financial limitations continue to be
applied on an annual per beneficiary basis rather than on a per
provider basis.
Comment: Many commenters believed there should be three separate
annual financial limitations, that is, one each for physical therapy,
occupational therapy, and speech-language therapy services. They argue
that the Congress never intended to include speech-language pathology
services within the physical therapy cap because speech therapists have
never been defined as independent therapists and were never subject to
the current $900 cap.
Response: As stated above, section 1861(p) of the Act defines the
term outpatient physical therapy services to include speech-language
pathology services. The language in BBA specifically makes provision
for physical therapy services and occupational therapy services in
applying the annual financial limitation and does not separately
mention speech-language pathology services. It is our position that BBA
does not include a separate cap for speech-language pathology services,
and that there are only two financial limitations (OT and PT that
includes speech-language therapy services).
Comment: Two commenters oppose the imposition of the $1,500 cap
because it is not sufficient to cover the cost of physical therapy for
many common diagnoses or cost of care for typical rehabilitation cases.
One of the commenters noted that MedPAC found in its June 1998 report
to Congress that one third of the patients receiving outpatient
rehabilitation services from rehabilitation agencies and CORFs exceeded
either the combined $1,500 cap on outpatient physical therapy and
speech-language pathology or the $1,500 cap on outpatient occupational
therapy.
Response: The commenter is correct in stating that the MedPAC's
study of a 5-percent sample of Medicare outpatient rehabilitation
claims for 1996 did find that about one-third of all patients receiving
outpatient rehabilitation services from rehabilitation agencies and
CORFs exceeded the $1,500 caps. However, the study noted that because
most Medicare beneficiaries received the services in hospital
outpatient departments in 1996, the percent of all patients impacted by
the $1,500 caps is considerably less, that is, only 10 percent of all
outpatient physical and speech therapy patients receiving services in
hospital outpatient departments, rehabilitation agencies and CORFs and
only 2 percent of all occupational therapy patients in those three
settings.
We plan to carefully study this issue. As discussed elsewhere in
this document, BBA requires that we submit a report to the Congress by
January 1, 2001 that recommends viable options for replacing the
current dollar caps that take into account patient diagnosis and prior
use of services.
Comment: One commenter stated that the limitation should apply only
to therapy services furnished by physical therapists and occupational
therapists, and not to therapy services furnished by physicians.
Another commenter contends that the cap applies solely to therapists
and physicians furnishing outpatient rehabilitation services under a
plan of care. Neither commenter believes that nonphysician
practitioners should be allowed to perform therapy services. These
commenters argue that only physical therapists or services provided
under the supervision of a physical therapist should be reimbursed by
Medicare. The commenters maintain that the definition of physical
therapists as referenced in Sec. 485.705(b) and the coverage guidelines
specified in section 2210.B of the MCM and 3101.8B of the MIM are not
met if the services are provided by persons other than physical
therapists. In addition, the statute does not extend the cap to
services furnished by practitioners other than OTIPs and PTIPs.
Response: Section 4541 of BBA provides for a prospective payment
for outpatient rehabilitation services. The operative word in the
statute is ``services''. Reference is made both to the payment for
outpatient therapy services and comprehensive outpatient rehabilitation
services on the basis of the physician fee schedule and to the
financial limitation for all rehabilitation services. The fee schedule
is applied to outpatient therapy or rehabilitation services without
regard to the practitioner who furnishes the service. Physical and
occupational therapy services furnished by physicians and certain other
recognized practitioners are payable under the physician fee schedule.
A nonphysician practitioner who provides services that would be
physicians' services if furnished by a physician under a specific
enumerated benefit in the statute would be considered as the physician
treating the beneficiary. Thus, a nonphysician practitioner would be
considered as the physician treating the beneficiary when he or she
furnishes outpatient physical therapy and occupational therapy
services. Nonphysician practitioners who meet this definition are
physician assistants (section 1861(s)(2)(K)(I) of the Act); and nurse
practitioners and clinical nurse specialists (sections
1861(s)(2)(K)(ii) and 1861(s)(2)(K)(iii) of the Act), operating within
the scope of their State licenses.
B. Use of Modifiers to Track the Financial Limitation. We have
established three discipline-specific modifiers for use in tracking the
financial limitation or cap. They are listed below.
GN Services delivered personally by a speech-language pathologist or
under an outpatient speech-language pathology plan of care;
GO Service delivered personally by an occupational therapist or under
an outpatient occupational therapy plan of care; or
GP Service delivered personally by a physical therapist or under an
outpatient physical therapy plan of care.
[[Page 58867]]
Reporting of these modifiers will also assist us in gathering data
on who is providing the services, and the frequency and duration of the
services. Many of the services, for example, physical modalities or
therapeutic procedures as described by HCPCS codes, are commonly
delivered by both physical and occupational therapists. Other services
may be delivered by either occupational therapists or speech-language
pathologists. For these services, we expect the claim to include a
modifier that describes the type of therapist who delivered the
service; if the service was not delivered by a therapist, then the type
of therapy plan of care under which the service is delivered would be
specified. If the type of therapy is not listed in the modifier field,
the claim would be rejected and sent to the provider for resubmission.
Comment: We received one comment that supports our proposal to use
modifiers that will be discipline-specific to identify whether a plan
of care is for physical therapy or occupational therapy. However, the
commenter also favors the addition of modifiers that will allow for the
identification of physician and nonphysician services that are provided
under a plan of care. Claims from physicians and nonphysicians with a
modifier would be subject to one of the caps, while claims without a
modifier would not be subject to any cap. Another commenter stated that
the proposed policy to reject a claim and send it to the provider for
resubmission if the type of therapy is not listed in the modifier field
is inappropriate and should not be adopted. The commenter contends that
there are legitimate cases in which the codes in Addendum D will be
reported but should not be applied against the caps, for example, if
the services are furnished by a nonphysician practitioner or a
physician but they are not provided under a therapy plan of care. This
contention is also shared by another commenter who strongly opposed our
proposal to apply services against the caps for occupational therapy
and physical therapy including speech-language pathology services based
strictly on an arbitrary reporting of certain CPT codes. The
presumption with this approach is that therapy services are furnished
whenever codes listed in Addendum D are reported
Response: At this time, we have decided to only use the discipline-
specific modifiers listed in the response above. These modifiers will
differentiate between either the type of therapist (physical therapist,
occupational therapist, speech-language pathologist) personally
providing the service or the discipline plan of care (physical,
occupational, and speech-language pathology). For example, if modifier
GP is used, the physical therapist must deliver personally the service
or the service must be delivered under a physical therapy plan of care.
Therefore, in addition to the personal provision of the therapy service
by the physical therapist, a physician or nonphysician practitioner can
also furnish the physical therapy service. We believe that additional
modifiers are not needed to delineate services provided by physicians
and nonphysician practitioners under a therapy plan of care; however,
we believe that the commenter's statement is valid regarding the
possible use of codes listed in Addendum D for other than therapy
purposes, that is, not under a therapy plan of care. We are exploring
the use of an additional modifier to indicate that the service denoted
by the code was not provided under a therapy plan of care. By the time
that the financial limitation or cap is fully implemented, we expect to
have established the additional modifier. Until that modifier is in
place, claims without a discipline-specific modifier will be returned
for resubmission.
Comment: A commenter stated that the cap will be difficult to track
administratively and recommended that there be a clearer delineation of
when services will be subject to the limit and what the controlling
factors will be (including the type of professional delivering the
service, whether there is a rehabilitation plan of care, and the nature
of the service), a listing or examples of services and the
circumstances under which they would not be included under the cap.
Response: The commenter's request for clarification is based on a
full implementation of the financial limitation or cap. Because of Y2K
issues, the financial limitation or cap will not be fully implemented
as mandated by statute effective January 1, 1999. Therefore, it is our
intention to carefully review, consider, and address the commenter's
concerns as we move from the transitional implementation of the cap on
a per-provider basis to the full implementation of the cap on an annual
per-beneficiary basis.
Comment: One commenter stated that the mechanics of implementing
the cap should be clarified. The commenter said that there are serious
concerns regarding the calculation of the cap, time of billing, and
timing of processing payments that would be fed into the database. The
commenter is concerned about the effect of medical review, for example,
whether payment will be reserved when a claim is filed in a timely
manner, subjected to medical review, denied, and successfully appealed,
and the claim was originally filed well before the cap is met. Several
commenters were of the opinion that it is administratively difficult
for all parties (beneficiaries, providers, and contractors) to track
the cap even with the use of the modifiers. They want us to address
specific issues regarding tracking and the use of modifiers before
implementation of the cap, and to also notify beneficiaries regarding
the tracking procedure. These specific issues include a clear
delineation of when services are subject to the limit, what the
controlling factors will be (including the type of professional
delivering the service, whether there is a rehabilitation plan of care,
and the nature of the service), a listing or examples of the services
and the circumstances under which they would be excluded from the cap.
Response: These are issues that will be addressed prior to the full
implementation of the financial limitation or cap. Because there is the
distinct possibility that systems requirements will change before such
full implementation, it does not seem prudent at this time to detail
the mechanics of the future implementation of the cap. However, it is
our current thinking that these concerns will be discussed and
clarified in companion program instructions issued to the Medicare
carriers and fiscal intermediaries.
Comment: A commenter stated that there should be a timely, readily
accessible means (such as a query system) for beneficiaries and
providers to ascertain the status of the beneficiary's outpatient
therapy benefits.
Response: This question relates to the full implementation of the
financial limitation or cap on an annual per-beneficiary basis. We are
exploring mechanisms by which both the beneficiary and the provider can
be informed in a timely and accurate manner, the amounts that have been
expended by the beneficiary for outpatient physical therapy services
including speech language pathology services and for outpatient
occupational therapy services. These methods will be discussed in any
program memorandum or other program instruction that we determine will
be the vehicle for the conveyance of the beneficiary cap status
information.
C. Treatment of Services Exceeding the Financial Limitation. As
required by section 1833(g) of the Act, as amended by section 4541 of
BBA, we revised our
[[Page 58868]]
policy to establish two annual per-beneficiary limits of $1,500. There
will be (1) an annual per-beneficiary limit for all outpatient physical
therapy services excluding hospital outpatient therapy services
furnished to an outpatient or an inpatient who is not in a covered Part
A stay and, (2) an annual per beneficiary limit for all outpatient
occupational therapy services excluding hospital outpatient therapy
services furnished to an outpatient or an inpatient who is not in a
covered Part A stay. As stated previously, outpatient physical therapy
services include speech-language pathology services. A provider of
outpatient rehabilitation services with a provider agreement under
section 1866 of the Act, as well as physicians, PTIPs and OTIPs, will
be allowed to collect payment from a beneficiary for therapy services
after the $1,500 limit is reached. This is consistent with current
policy allowing PTIPs and OTIPs to collect payment from a beneficiary
for therapy services in excess of the current $900 limit.
Required Congressional Report on Financial Limitation
We note that a report to the Congress is due from the Secretary no
later than January 1, 2001. This report must include recommendations on
the establishment of a revised coverage policy of outpatient physical
therapy services, including speech-language pathology services and
outpatient occupational therapy services. The revised policy must be
based on a classification of individuals by diagnosis category and
prior use of services in both inpatient and outpatient settings. The
report should include recommendations on how such durational limits by
diagnostic category could be implemented in a budget-neutral manner.
Comment: It was recommended by a commenter for the report to the
Congress that, in addition to basing a revised policy on classification
by diagnosis category and prior use of services, an individual's
functional status should be a component of any system that purports to
address a patient's need for rehabilitation.
Response: As we develop the report to the Congress, we will
consider the feasibility of the recommendation.
4. Qualified Therapists
Section 1861(p) includes services furnished an individual by a
physical therapist who meets licensing and other standards prescribed
by the Secretary if the services meet the conditions relating to health
and safety the Secretary finds necessary. The services must be
furnished in the therapist's office or the individual's home. By
regulation, we have defined therapists meeting the conditions for
coverage of services under this provision as physical therapists in
independent practice. The conditions for coverage are set forth in part
486, subpart D (Conditions for coverage: Outpatient Physical Therapy
Services Furnished by Physical Therapists in Independent Practice) and
require that the services be provided by a therapist in independent
practice under Sec. 410.60. Under Sec. 410.60, a therapist in
independent practice is one who:
<bullet> Engages in the practice of therapy on a regular basis.
<bullet> Furnishes services on his or her own responsibility
without the administrative and professional control of an employer.
<bullet> Maintains at his or her own expense office space and
equipment.
<bullet> Furnishes services only in the office or patient's home.
<bullet> Treats individuals who are his or her own patients and
collects fees or other compensation for the services.
Under Sec. 486.151 (Conditions for coverage: Supervision), all
therapy services must be furnished under the direct supervision of a
qualified therapist in independent practice. In other words, the
therapist in independent practice must be on the premises whenever
services are provided to Medicare beneficiaries, including services
provided by a licensed physical therapist. This long-standing
requirement has been controversial with therapists in independent
practice. For example, a therapist in independent practice cannot have
more than one office open for services at the same time since he or she
could not be on both premises at once.
We are revising our policy to replace the existing ``Conditions for
Coverage: Outpatient Physical Therapy Services Furnished by Physical
Therapists in Independent Practice'' (part 486, subpart D), which
requires survey and certification, with a simplified criteria for
physical therapists in private practice that would use a carrier
enrollment process. The impetus for this change comes from
congressional statements associated with the fiscal year 1997
appropriations process. Statements in both the House and Senate
committee reports accompanying HCFA's fiscal year 1997 appropriations
addressed the issue of requiring that the certified physical or
occupational therapist in independent practice directly supervise all
services performed by his or her employees, even if those employees are
fully-licensed therapists. The House committee report urged that we
modify the regulations so that the certified therapist need not be on
premises to supervise other licensed therapists. The Senate urged us to
review this concern and recommend regulatory or instructional changes.
We are redefining those therapists who are qualified under section
1861(p) of the Act. That is, we would discontinue the focus of the
regulation on their ``independent'' status (which is not statutory) and
recognize therapists in private practice who are employed by others
and, therefore, do not meet our current ``independent'' criteria. This
would be consistent with health and safety concerns and would conform
to normal private sector practice standards. The following new
requirements replace the current ones for qualified therapists:
<bullet> The term ``independent'' is dropped and the benefit would
be for an individual physical therapist or occupational therapist in
private practice.
Private practice includes an ``individual'' whose practice is in an
unincorporated solo practice, unincorporated partnership, or
unincorporated group practice. Private practice also includes an
``individual'' who is practicing therapy as an employee of one of the
above or of a professional corporation or other incorporated therapy
practice. However, private practice does not include individuals when
they are working as employees of a provider. A provider as defined in
Sec. 400.202 includes a hospital, CAH, SNF, HHA, hospice, CORF, CMHC,
or an organization qualified under part 485, subpart H (Conditions of
Participation for Clinics, Rehabilitation Agencies, and Public Health
Agencies as Providers of Outpatient Physical Therapy and Speech-
Language Pathology Services), as a clinic, rehabilitation agency, or
public health agency.
<bullet> In implementing the statutory requirement that services be
furnished to an individual in the therapist's office, or in the
individual's home, ``in his office'' is defined as the location(s)
where the practice is operated, in the State(s) where the therapist
(and practice, if applicable) is legally authorized to furnish
services, during the hours that the therapist engages in practice at
that location.
A therapist in private practice must maintain a private office, if
services always are furnished in patients' homes. However, if services
are furnished in private practice office space, that space would have
to be owned, leased, or
[[Page 58869]]
rented by the practice and used for the exclusive purpose of operating
the practice. For example, because of the statutory restriction on the
site of services, a therapist in private practice cannot furnish
covered services in an SNF. Therefore, if a therapist wished to locate
his or her private office on site at a nursing facility, special care
would need to be taken. The private office space could not be part of
the Medicare-participating SNF's space, and the therapist's services
could be furnished only within that private office space. Neither the
therapist nor any assistants or aides who help furnish services could
be employed by the SNF during the same hours that they are working in
the private practice. Another example where special attention would be
needed is space that generally serves other purposes and is only used
by a therapy practice during limited hours. For example, a therapist in
private practice may furnish aquatic therapy in a community center pool
on Wednesday mornings. The practice would have to rent or lease the
pool for those hours, and the use of the pool during that time would
have to be restricted to the therapist's patients, in order to
recognize the pool as part of the therapist's own private office during
those hours.
In describing other services that are specifically limited to the
patient's home, the statute uses qualifying language. For example, the
durable medical equipment definition in section 1861(n) of the Act
refers to a patient's home as ``including an institution used as his
home other than an institution that meets the requirements of
subsection (e)(1) of this section or section 1819(a)(1).'' This
definition of home is codified under our regulations at Sec. 410.38(b).
The same definition always has been used in the Medicare Carriers
Manual for purposes of covering therapists' services in a patient's
home. We are continuing the current practice and are adopting the
definition formally in this regulation.
<bullet> Assistants and aides have to be personally supervised by
the therapist and employed directly by the therapist, by the
partnership or group to which the therapist belongs, or by the same
private practice that employs the therapist. Personal supervision
requires that the therapist be in the room during the performance of
the service. Levels of supervision are defined in Sec. 410.32 of our
regulations.
<bullet> The therapist must be licensed or otherwise legally
authorized to engage in private practice. We understand that all States
license or certify physical therapists, so no alternative personnel
qualifications need to be specified.
<bullet> Each therapist enrolls ``as an individual'' with the
carrier.
There would be no survey and no certification by HCFA. The Medicare
carrier would verify that the qualifications proposed in
Secs. 410.59(c)(1) or 410.60(c)(1) of our regulations are met. All
applicants for new enrollment would become subject to these new rules
and procedures upon the effective date of the final rule. For
transition purposes, we intend that independent therapists who are
certified and enrolled at that time would be ``grandfathered''
temporarily and would become subject to the new enrollment rules and
procedures at the time of their next regular periodic reenrollment.
These changes would address the concern that current rules require
each independent therapist to personally supervise services performed
by any other licensed therapists that he or she employs. Under our
proposal, each individual therapist in a practice could qualify to
separately enroll, and enrolled therapists would not be required for
purposes of Medicare to be supervised by their employer. These changes
also address the concern that current rules prohibit an independent
therapist from being employed by any entity. Under our proposal, a
variety of employment situations would be permitted.
These new requirements are established in a revised Sec. 410.60(c)
for physical therapists. To date, the statutory requirements for
coverage of outpatient occupational therapy services have not been
codified. We are codifying these requirements by establishing a new
Sec. 410.59 for outpatient occupational therapy services. The
regulations section for outpatient occupational therapy parallels the
Sec. 410.60 requirements for outpatient physical therapy, as revised in
this final rule. We are also making conforming changes in Sec. 410.61
to include occupational therapy.
Therapists in private practice do not participate in the Medicare
program in the same way that ``providers of services'' do. Though they
must be approved as meeting certain requirements, unlike ``providers of
services,'' they do not execute a formal provider agreement with the
Secretary as described in 42 CFR part 489 (Provider Agreements and
Supplier Approval). Like physicians, they do have the option of
accepting a beneficiary's assignment of his or her claim for Medicare
Part B benefits and of becoming a Medicare-participating supplier that
agrees to accept assignment in all cases.
Comment: One commenter strongly supports the carrier enrollment
process for physical therapists instead of the existing conditions of
coverage. However, the commenter wanted operational issues addressed
such as a specification that payments will be made under the practice
or corporation's tax ID number for services furnished by physical
therapists in private practice who are employees of other practices or
corporations. This is the same payment system used by a physician group
practice, and the treating therapist's Medicare number or license
number would be included on the bill. In addition, the commenter urged
that the same process be used for the carrier enrollment process as for
the current physician enrollment. Another commenter supported the
changes for OTPPs; however, assuming that payment is made to the
individual, the commenter inquired as to whether group numbers would be
assigned so that payment could be issued to the group under the tax
identification number of the business entity.
Response: We will use the same enrollment and billing process as is
currently used for individual physicians and physician group practices.
This process is delineated at section 1030.7 of the Medicare Carriers
Manual, HCFA Pub. 14-Part 4. We note that payment is not made on the
basis of the corporate or group practice tax identification number.
This number is just one of the data elements that can be related to the
Medicare individual and/or group billing number.
Comment: A commenter recommended that direct supervision of
assistants and aides be required instead of personal supervision. The
commenter provided that direct supervision would be consistent with
state laws, the supervision requirements for nonphysician personnel
performing services in a physician's office, and with the supervision
requirements for aides and assistants of PTIPs.
Another commenter agreed that personal supervision over therapy
aides by a qualified occupational therapist or qualified occupational
therapy assistant is appropriate. However, the commenter strongly
disagreed with the proposal to require personal supervision over
occupational therapy assistants and instead urged the adoption of a
policy for practicing occupational therapists whereby occupational
therapy assistants can perform covered services under the general
supervision (that is, initial direction and periodic inspection) of a
qualified occupational therapist. In
[[Page 58870]]
addition, the commenter thought the policy should state that either a
qualified occupational therapist or a qualified occupational therapy
assistant must provide personal supervision when therapy aides are used
to furnish services.
A commenter stated that qualified occupational therapists who are
not Part B suppliers, but who are employed by a therapist who is
enrolled as a Part B supplier, should not be subject to the personal
supervision requirement. In addition, it was suggested that the
proposed language at Sec. 410.59(c)(2) regarding supervision of
occupational therapy services should be revised as follows:
``Occupational therapy services are performed by, or under the
general supervision of, the occupational therapist in private practice.
Services provided by therapy aides must be performed under the personal
supervision of an occupational therapist or occupational therapy
assistant. All services not performed personally by the therapist in
private practice must be performed by employees of the practice, under
the applicable level of supervision by the therapist, and included in
the fee for the therapist's services.''
Response: Statements contained in the House and Senate committee
reports accompanying the 1997 appropriations recommended modifications
in our supervision requirements for qualified therapists. As stated,
the House committee report urged a regulatory change in the requirement
that certified therapists be on the premises to supervise other
licensed therapists. We were also urged by the Senate to review this
concern and recommend regulatory or instructional changes. We have
addressed the concern expressed in the House and Senate 1997
appropriations committee reports and will allow certified therapists to
be off the premises when other licensed therapists are present.
However, we do not believe that we have the authority to modify the
supervision requirements for therapy (physical, occupational or speech-
language pathology) assistants and aides. Therefore, we are maintaining
our current requirement that therapy assistants and aides have to be
personally supervised by the therapist and employed directly by the
therapist, by the partnership or group to which the therapist belongs.
In accordance with the aforementioned policy, there is no change in the
proposed language found at Sec. 410.59(c)(2).
Comment: We received one comment on our proposed qualifications for
occupational therapists. One organization recommends that we require
evidence of successful completion of a national certification
examination recognized by the regulatory authority in the State of
practice. Reasons given for the addition of this requirement are that
practice varies by jurisdiction and unsuccessful exam candidates often
move from State to State obtaining temporary licenses in spite of
repeatedly failing qualifying exams. The commenter adds that the
particular test they recommend is required in every jurisdiction.
Response: We believe that this recommendation has merit. However,
we believe that it requires further study and discussion to assess its
impact before we can consider it for adoption. Therefore, we believe it
would be more appropriate to consider this recommendation as a proposal
for a subsequent publication rather to accept it for adoption in this
final rule.
Comment: One commenter supports our proposed set of changes
addressing independent practicing occupational therapist services, but
adds that as Medicare moves to embrace market based competition, the
focus should be on the outcomes delivered rather than the input
credentialing. There should be a commitment to move beyond burdensome
input criteria that add costs and restrict competition. The commenter
suggests that, as part of that initiative, we establish a meaningful
time horizon for moving to outcomes-based performance measures.
Response: This is a welcomed recommendation. In recent years, when
revising our conditions of participation for various entities, we have
emphasized outcomes-based measures. However, this is an area that
requires further study in order to apply this concept to our conditions
for occupational therapists practice.
Comment: One commenter stated that verification should be provided
in the final rule that section 1861(p) of the Act requires a physician
to have services furnished by a licensed physical therapist or under
the supervision of such a therapist when billing for physical therapist
services incident to the physician's professional services.
Response: Section 1861(p) of the Act does not set forth the
requirements as specified by the commenter. As previously stated,
section 4541(b) of the BBA 1997 amended section 1862(a) of the Act to
require that outpatient physical therapy services (including speech-
language pathology services) and occupational therapy services
furnished ``incident to'' a physician's professional services meet the
standards and conditions (other than any licensing requirement
specified by the Secretary) that apply to therapy services furnished by
a therapist. In May 1998, we issued Transmittal No. 1606 of the
Medicare Carriers Manual, Part 3--Claims Process which implemented this
provision that was effective January 1, 1998. Section 2218(A) of the
Medicare Carriers Manual requires that physical therapy services
provided by a physician or by an incident-to employee of the physician
in the physician's office or the beneficiary's home must be provided
by, or under the direct supervision of, a physician (a doctor of
medicine or osteopathy) who is legally authorized to practice physical
therapy services by the State in which he or she performs such function
or action.
5. Plan of Treatment
We are proposing to revise Secs. 410.61(e), 424.24(c)(4)(i), and
485.711(b), which concern the plan of treatment review requirements for
outpatient rehabilitation therapy services. Section 1861(p) of the Act
defines these therapy services, in part, as services furnished to an
individual who is under the care of a physician and for whom a plan,
prescribing the type, amount, and duration of therapy services that are
to be furnished, has been established by a physician or a qualified
therapist and is periodically reviewed by a physician.
Currently, providers that furnish outpatient rehabilitation therapy
services are required to have a physician review the plan of treatment
and recertify the need for care at least every 30 days. We proposed
revising our policy to allow the physician to review and recertify the
required plan of treatment within the first 62 days and at least every
31 days after the first review and recertification. The current
requirement for the review of a plan of treatment for patients of
physical therapists in independent practice is similar in that the
physician must review the plan at least every 30 days. We proposed
changing this review requirement and requiring that the physician
review and recertify the plan of treatment within the first 62 days and
at least every 31 days thereafter.
We recommended these changes because it was our understanding that
an initial 2-month (62 day) review is consistent with the usual therapy
course of treatment. It is also consistent with our current therapy
requirements in the home health setting. These changes were intended to
reduce the burden on providers, patients, and physicians by eliminating
the current requirement for an initial review within the first 30 days.
After the first 62 days, we believed
[[Page 58871]]
that patients receiving outpatient rehabilitation services are likely
to show significant progress that warrants subsequent reviews every 31
days. Changes in the patient's level of function and need for continued
therapy can be expected to occur more frequently after the first 2
months of therapy. We believe this subsequent review schedule will help
control potential over-utilization that results in excessive therapy to
some Medicare patients.
Under our proposed policy, the therapists would be required to
immediately notify the physician of any changes in the patient's
condition, and physicians retain the ability to review the care at
closer intervals if necessary.
Comment: We received comments from six outpatient rehabilitation
associations supporting our proposal and two comments from orthopedic
surgical associations strongly opposing it. The opposing orthopedic
associations informed us that 62 days is not the usual course of
treatment. They argued that every patient's need for therapy is unique
depending on the condition. While 62 days may be appropriate for some
back injuries, they contend it would be inappropriate for a hand, foot,
or shoulder injury. Therapy is appropriate as long as the patient
continues to make progress and should be discontinued when the
patient's condition has plateaued and no further progress is being
made. They stated this can best be determined by the referring
physician periodically evaluating the patient's progress and recovery.
They believe the current 30-day requirement is appropriate and should
be maintained.
Response: After careful review of the comments received and study
of the issue by our medical staff, we are retaining our current 30-day
requirement and rescind our proposal. As indicated above, our intent,
in part, was to establish consistency with the initial review period
for HHA therapy services. However, subsequent to our proposal we
further learned that HHA patients may not receive the same level of
intensity of therapy services as patients receiving them under the
outpatient rehabilitation benefit. Our medical staff believes that
patients in the latter group are seen more often by their therapists
than are HHA patients. Therefore, the rate of progression between the
two patient groups may be different and warrant a 30-day rather 62-day
initial plan of treatment review for beneficiaries receiving outpatient
rehabilitation services.
Comment: We received several comments to allow nonphysician
practioners such as nurse practitioners, physician assistants, and
clinical nurse specialist to certify the therapy plan of care.
Response: Because we allow nonphysician practioners, that is, nurse
practitioners, clinical nurse specialists, and physician assistants to
prescribe medicine, we have also decided that nonphysician practioners
who have knowledge of the therapy case may certify therapy plans of
treatment.
Result of the evaluation of comments: We are adopting our proposal
to pay all outpatient rehabilitation services and CORF services under
the physician fee schedule. We are delaying full implementation of the
financial limitations on outpatient rehabilitation services furnished
by nonhospital entities due to our Y2K efforts until after January 1,
2000. We are not adopting a site-of-service differential for outpatient
rehabilitation providers as recommended by commenters. Regarding
proposed qualifications for therapists, we are adopting them as
proposed and are not accepting the recommendation that we require
occupational therapists to provide evidence of successful completion of
a national certification examination. We anticipate that this issue
will be further studied and discussed in a subsequent rule. We are
withdrawing our proposal to extend from 30 days to 60 days the time
required for physician recertification of the plan of treatment.
D. Payment for Services of Certain Nonphysician Practitioners and
Services Furnished Incident to Their Professional Services
Nonphysician practitioners' services have been covered by Medicare
since the inception of the program; originally the law did not provide
for separate payments for these services. Coverage and payment of
nonphysicians' services was primarily within the context of section
1861(s)(2)(A) of the Act as implemented by section 2050 of the Medicare
Carriers Manual, for the payment of services incident to a physician's
professional services. In recent years, the Congress has expanded
Medicare coverage of nonphysician practitioners' services in certain
settings to improve beneficiary access to medical services. Separate
Part B coverage is specifically authorized for certain nonphysician
practitioners' services and for services and supplies furnished as
incident to those services.
For purposes of this rule as it applies to nonphysician
practitioners, we define nonphysician practitioners as nurse
practitioners, clinical nurse specialists, certified nurse-midwives,
and physician assistants. With respect to services and supplies
furnished as incident to a nonphysician practitioner's services, we are
requiring that, to be covered by Medicare, the services must meet the
longstanding requirements in section 2050 of the Medicare Carriers
Manual applicable to services furnished as incident to the professional
services of a physician. Therefore, we specify, in new Secs. 410.74(b),
410.75(d), 410.76(d), and 410.77(c) that Medicare Part B covers
services and supplies (including drugs and biologicals that cannot be
self-administered) furnished as incident to the nonphysician's services
only if these services and supplies would be covered if furnished by a
physician or furnished as incident to a physician's professional
services. In addition, Secs. 410.74(b), 410.75(d), 410.76(d), and
410.77(c) specify the various requirements for these incidental
services and supplies.
Coverage and Payment for Nurse Practitioners' Services Subsequent to
BBA
Effective for services furnished on or after January 1, 1998,
section 4511 of BBA authorizes nurse practitioners to bill the program
directly for services furnished in any setting, regardless of whether
the settings are located in rural or urban areas, but only if the
facility or other providers of services do not charge or are not paid
any amounts with respect to the furnishing of nurse practitioners'
services. Accordingly, a new Sec. 410.75 of this rule specifies the
qualifications for nurse practitioners, lists the requirements for the
professional services of a nurse practitioner and the requirements for
services furnished incident to the professional services of a nurse
practitioner. This new section also specifies the process that applies
to the provision of nurse practitioners' services.
New Secs. 405.520(a), (b), and (c) of this rule provide the general
rule and requirements for nurse practitioners. A new paragraph (16) is
added to Sec. 410.150(b) to authorize payment for nurse practitioners'
services when furnished in collaboration with a physician in all
settings located in both rural and urban areas. A new paragraph (c) is
added to Sec. 414.56 of this rule to set forth the payment amount for
nurse practitioner services.
All of the independent nurse practitioners and clinical nurse
specialists commenting on the proposed rule and all of the major
organizations representing these nonphysician practitioners vigorously
opposed the proposed Federal guidelines for
[[Page 58872]]
collaboration; those provisions would apply only in States with no
collaboration requirement.
Comment: The commenters that objected to the proposed guidelines
for collaboration requested that we adopt a policy that strictly defers
to State laws, rules, and regulations regarding collaboration. The
commenters insisted that the absence of State guidelines for
collaboration does not necessitate the intrusion of Federal guidelines.
In fact, they claimed that where State laws or guidelines do not
include a requirement for collaboration, or fail to provide specific
detailed requirements for a collaborative relationship, it is not a
matter of accident or simple omission, but of conscious State policy
regarding professional scope of practice. In these cases, they believe
that there should be no collaboration requirement.
Additionally, these commenters stated that they believe that there
is a better understanding at the State level of the practice situations
encountered and the evolving advancements in health care issues.
Therefore, many States have determined that this relationship is best
defined by the professionals themselves, rather than through detailed
statutory legislation.
The commenters claimed that they are not aware of any substantial
problems in interpreting or implementing the collaboration requirement
in the 7\1/2\ years that carriers have been applying the collaboration
requirement without the benefit of Federal rule. According to one
commenter, currently at least 26 States have no statutory or regulatory
requirement for collaboration as a condition that nurses must satisfy
in order to practice, and in the 16 States that have physician
collaboration or supervision practice requirements, none are as
restrictive as the guidelines that we proposed.
One of the commenters that opposed the proposed collaboration
guidelines stated that if more detailed provisions such as these are
imposed on nurse practitioners and clinical nurse specialists, there
will be a cost attached to be borne by the practitioner or consumers
through cost shifting. Another commenter expanded upon this comment by
posing the concern about how collaboration might affect States that
authorize nurses to practice independently. The commenter stated that
imposition of the collaboration requirement in ``independent practice
States'' could create a new area for potentially fraudulent or abusive
practices. For example, a physician may refuse to provide collaboration
in a given area or may refuse to enter into a collaboration agreement
unless the nurse pays a fee to the physician. This practice may violate
the anti-kickback statute.
One commenter stated that our proposal restricted nurses to a
collaboration arrangement with one physician, and that the State's
nurse practice act does not restrict nurses to a collaborative practice
arrangement with one physician. The requirement of collaboration with
one physician raises the cost to patients, restricts access, and
requires unnecessary, additional services. Additionally, this same
commenter raised concerns about the phrase in the collaboration
guidelines that states ``or as provided by other mechanisms defined by
Federal regulations,'' because she believes that this is the first time
this wording has appeared in the definition of collaboration and it
appears to give unlimited authority for regulation of practice.
One of the professional organizations representing nurse
practitioners maintained that the proposed collaboration guidelines
would particularly harm Medicare beneficiaries located in rural areas,
where nurse practitioners may be the sole source of health care within
the community. If a nurse practitioner is not able to receive payment
for care due to the inability to locate a physician in that geographic
area who is able to perform the functions of a collaborating physician,
these areas may not be served at all.
Response: Section 6114 of OBRA 1989 established the nurse
practitioner benefit as a separate benefit under the Medicare Part B
program and also required that nurse practitioners collaborate with a
physician in order for their services to be covered under Medicare.
Therefore, nurse practitioners have always been required by Medicare
law to collaborate with a physician. The collaboration requirement is a
specific and distinct requirement, separate from the requirement that
these nonphysician practitioners must practice within the scope of the
law of the State where the services are performed.
The 1989 Omnibus Budget Reconciliation Act, adding section
1861(aa)(6) of the Act, defined the term, ``collaboration'' as a
process in which a nurse practitioner works with a physician to deliver
health care services within the scope of the practitioner's
professional expertise, with medical direction and appropriate
supervision as provided for in jointly developed guidelines or other
mechanisms as provided by the law of the State in which the services
are performed. The BBA of 1997 increased payment amounts to nurse
practitioners and expanded the settings where they can receive
payments, but the BBA did not change the collaboration requirement. In
the absence of State law regarding the collaborative relationship that
nurse practitioners must share with a physician when furnishing their
services to Medicare beneficiaries, we must implement the collaboration
requirement as required by law.
However, we did not intend to introduce new burdensome requirements
to address situations where there is no State requirement for
collaboration. Therefore we are removing the proposed definition of
collaboration that applies to these situations and will require that,
in the absence of State law or regulations governing collaboration
relationships, we will require nurse practitioners and clinical nurse
specialists to document their scope of practice and indicate the
relationships that they have with physicians to deal with issues
outside their scope of practice. The proposed rule was not intended to
require that a nurse practitioner must furnish services in
collaboration with only one physician. We fully expect that these
nonphysician practitioners may have collaborative relationships with
numerous physicians and will continue to do so in the future. We did
not intend to introduce any new costs to the practices of nurse
practitioners and clinical nurse specialists.
Comment: Five major associations and professional organizations
representing physicians, medical directors, and hospitals commented in
favor of the proposed collaboration guidelines and suggested
alternative criteria that they believed the Medicare program should use
to determine coverage and payment for the services of nurse
practitioners and clinical nurse specialists.
Two of these organizations commented that ``appropriateness'' is
the key criterion that Medicare contractors should use in determining
whether services of these nonphysician practitioners should be covered
under the ``reasonable and necessary'' provisions of section
1862(a)(1)(A) of the Act. These commenters suggested that we consider
services to be appropriate if they are furnished by qualified
personnel; further, the commenters believed that, in the case of
psychiatry services, these nonphysician practitioners are not qualified
as physicians are to perform a psychiatric diagnostic interview
examination (CPT codes 90801 and 90802), nor are they qualified to
furnish services represented by any of the psychotherapy CPT codes
[[Page 58873]]
that include medical evaluation and management. Therefore, these
commenters asserted, all of the pertinent sections of the regulations
text should be revised to read that the nonphysician practitioners are
not performing services otherwise precluded from coverage because of
one of the statutory coverage exclusions listed under section
1862(a)(1)(A) of the Act.
Response: In order for any service to be covered under Medicare, it
must be determined to be reasonable and necessary, and therefore,
appropriate. Accordingly, we do not believe that it is necessary to
revise the regulations text to specify that services furnished by these
nonphysician practitioners can be covered only when they are not
otherwise excluded from coverage under section 1861(a)(1)(A) of the
Act. It is already stated in the proposed rule at sections
410.74(a)(2)(iii), 410.75(c)(3), and 410.76(c)(3) that services
performed by any of these nonphysician practitioners are not covered if
they are otherwise excluded from coverage because of a statutory
exclusion. Additionally, it is our understanding that some nurse
practitioners and clinical nurse specialists specialize in mental
health. Therefore, if State law authorizes these nonphysician
practitioners to perform mental health services and evaluation and
management services that would otherwise be furnished by a physician or
incident to a physician's services, psychiatric nurse practitioners and
clinical nurse specialists could bill for psychiatric diagnostic
interviews and any of the psychotherapy CPT codes that include medical
evaluation and management.
Comment: One association representing hospitals urged us to clarify
in the final rule all of the settings in which separate payment to
nurse practitioners and clinical nurse specialists will not be made.
Also, the commenter suggested clarification regarding whether Medicare
will continue to pay hospitals for the facility component of hospital
outpatient department services when separate payment is made to these
nonphysician practitioners for their professional services furnished in
hospital outpatient departments.
Response: Payment is made to nurse practitioners and clinical nurse
specialists for their professional services furnished in all settings,
with the exception of RHCs and FQHCs. (The professional services of all
practitioners are bundled in these two settings, and Medicare payment
is made to the facility for such services under an all-inclusive
composite rate.) However, when these nonphysician practitioners furnish
services in hospital outpatient departments, Medicare will continue to
make payment to the hospital outpatient department for the facility
component of hospital outpatient department services.
Comment: Two other organizations commented that we should require
that the employer of a nurse practitioner or a clinical nurse
specialist bill for his or her professional services. The commenter
stated that technically, some nurses can practice without direct
supervision, but not independently of the supervising physician since
the physician must review all records within 2 weeks. The commenter
believes that safe and high quality medical care requires that
diagnosis, evaluation, treatment, and management decisions be made by
physicians who directly supervise nonphysician practitioners on-site.
The commenter argues that, if payment is made directly to the nurses,
the physician has no way of verifying what is billed when an employer
relationship does not exist. Also, because collaboration does not
require that the physician be present while services are furnished, and
it does not require a physician to make an independent evaluation of
each patient, there is no assurance that safe, high quality services
are being performed.
Response: The law no longer requires that the employers of nurse
practitioners and clinical nurse specialists bill for their services,
as it does for physician assistants. The law does maintain the
requirement, however, that these nonphysician practitioners must
furnish their services in collaboration with a physician. Nurse
practitioners and clinical nurse specialists have been educated and
specially trained to furnish primary care and certain other services
that have traditionally been furnished by physicians. As long as the
services that nonphysician practitioners furnish are medically
reasonable and necessary, meet Medicare requirements, and fall within
the scope of services that they are licensed to perform, the Medicare
program covers the services.
Comment: Numerous nurse practitioners and clinical nurse
specialists commented that Secs. 410.75(d) and 410.76(d) that pertain
to services and supplies furnished incident to the professional
services of a nurse practitioner or clinical nurse specialist should be
clarified to state that these nonphysician practitioners need not be
present in the same room where the services are being provided, but may
be present and available in the office suite.
Additionally, these same commenters requested the elimination of
the list of examples of professional services performed by nurse
practitioners and clinical nurse specialists at Sec. Sec. 410.75(e)(3)
and 410.76(e)(3), asserting that the list is too limited, confusing,
and ultimately unnecessary.
Response: We agree that it may be more appropriate to include the
list of examples of services in manual instructions to provide guidance
to contractors to use in processing claims. Therefore, we are removing
the listing of examples of services that can be provided by physician
assistants at section 410.74(d)(3), nurse practitioners at section
410.75(e)(3), and clinical nurse specialists at section 410.76(e)(3).
Comment: One commenter suggested a language change to the
requirement that ``incident to'' services be of a type that are
commonly furnished in a physician's office, to also include a reference
to the offices of other health professionals.
Response: The ``incident to'' requirements for nonphysician
practitioners are the same requirements that apply to physicians and
that have been in place since the inception of the Medicare program.
The various ``incident to'' requirements are currently interpreted at
section 2050 of the Medicare Carriers Manual. We will not amend any of
the ``incident to'' requirements at this time.
Comment: A few nurses' associations commented that the proposed
qualifications for nurse practitioners and clinical nurse specialists
should be amended to clarify that these individuals must be licensed or
certified by a professional association or an accrediting body that
has, at a minimum, eligibility requirements that meet certain
standards. One commenter stated that the accrediting body could be one
that is recognized by us. These commenters explained that most
organizations that certify nurses are not professional associations
themselves; rather they are separately incorporated accrediting bodies.
For example, the American Nurses Association does not certify nurse
practitioners or clinical nurse specialists, but the American Nurses
Credentialing Center (ANCC) does by utilizing standards developed by
the nurse profession.
Response: Currently, the qualifications for nurse practitioners at
section 2158 of the Medicare Carriers Manual require that such an
individual be certified as a primary care nurse practitioner by the
American Nurses' Association or by the National Board of Pediatric
Nurse Practitioners and Associates. (Section 2160 of the Medicare
Carriers Manual does not contain a specific certification criteria
[[Page 58874]]
for clinical nurse specialists.) Thus, the manual recognizes the ANCC
as an appropriate certifying body for nurse practitioners.
Comment: One comment made was directed specifically toward the
qualifications for nurse practitioners at Sec. 410.75(b) of the
proposed rule. One academy representing nurse practitioners stated that
the intent of the law is to pay nurse practitioners who are licensed in
their States to practice as such. Therefore, the qualifications for
nurse practitioners should be that the individual be a registered nurse
who is authorized to practice as a nurse practitioner in accordance
with State law. This academy believes that the inclusion of additional
requirements will exclude some fully qualified nurse practitioners who
are certified by national certifying bodies that recognize
grandfathering laws in the States and by States that currently use
program accreditation or certification rather than national
certification in their licensing processes for nurse practitioners.
Response: We agree with the commenter that the intent of the law is
to pay nurse practitioners who are licensed in their States to practice
as such. However, we believe that State licensure should not be the
only qualification criterion that would enable nurse practitioners to
bill the Medicare program directly for their professional services.
Therefore, we will revise the qualification requirements to ensure that
for Medicare purposes, appropriate individuals can bill the program for
services furnished to Medicare beneficiaries.
Comment: One college representing nurse practitioners raised
concerns about the types of services for which nurse practitioners can
bill the Medicare program. The college stated that it wishes to ensure
that we intend to permit a nurse practitioner to bill within a group
practice setting for the services of all other licensed health care
professionals and technicians in that practice. The commenter stated
that, although the proposed rule does not indicate a problem with this
billing arrangement, it would appreciate a specific statement from us
about the arrangement.
Response: A nurse practitioner within a group practice setting
would be permitted to bill the Medicare program for the services of all
other licensed health care professionals and technicians within the
practice, provided the services of others in the practice are furnished
incident to the nurse practitioner's professional services and all the
``incident to'' requirements are met.
Comment: The college also stated that it is concerned that the
proposed rule does not list nurse practitioners as designated providers
of outpatient physical therapy and outpatient speech-pathology
services. The college asks that the language of Secs. 410.60 and 410.62
be amended to include nurse practitioners as nonphysician practitioners
who are authorized to bill for these types of services.
Response: Nurse practitioners, clinical nurse specialists, and
physician assistants may order physical therapy, occupational therapy,
and speech-language pathology services in the case where the services
are medically reasonable and necessary and the State in which they are
practicing authorizes them to do so. Also, these nonphysician
practitioners may also certify and recertify the plan of treatment for
physical therapy, occupational therapy, and speech-language pathology
services providing they are authorized by State law to perform such
services. Accordingly, Sec. 410.60 and 410.62 regarding physical
therapy, occupational therapy, and speech-language pathology will be
revised to include these nonphysician practitioners as designated
providers of such services.
Result of evaluation of comments: We have determined that for
purposes of Medicare Part B payment, a nurse practitioner must--
<bullet> Possess a master's degree in nursing;
<bullet> Be a registered professional nurse who is authorized by
the State in which the services are furnished, to practice as a nurse
practitioner in accordance with State law; and
<bullet> Be certified as a nurse practitioner by the ANCC or other
recognized national certifying bodies that have established standards
for nurse practitioners as stated above.
We have removed the alternate proposed definition of collaboration
in Secs. 410.75(c)(2)(iv) and 410.76(c)(2)(iv) of the proposed rule.
For purposes of Medicare coverage, the collaboration requirement will
state that nurse practitioners and clinical nurse specialists must meet
the standards for a collaborative process, as established by the State
in which they are practicing. In the absence of State law governing
collaborative relationships, collaboration is a process in which these
nonphysician practitioners have a relationship with one or more
physicians to deliver health care services. Such collaboration is to be
evidenced by nurse practitioners or clinical nurse specialists
documenting their scope of practice and indicating the relationships
that they have with physicians to deal with issues outside their scope
of practice. Nurse practitioners and clinical nurse specialists must
document this collaborative process with physicians. The collaborating
physician does not need to be present with the nurse practitioner or
clinical nurse specialist when the services are furnished or to make an
independent evaluation of each patient who is seen by the nurse
practitioner or clinical nurse specialist.
Also, we are deleting the proposed listing of examples of services
that can be provided by physician assistants, nurse practitioners and
clinical nurse specialists.
Coverage and Payment for Clinical Nurse Specialists' Services
Subsequent to BBA
Effective for services furnished on or after January 1, 1998,
section 4511 of BBA authorizes clinical nurse specialists to bill the
program directly for services furnished in any setting, regardless of
whether the settings are located in rural or urban areas, but only if
the facility or other providers of services do not charge or are not
paid any amounts with respect to the furnishing of nurse practitioners'
services. A new Sec. 410.76(e) of this rule sets forth this provision.
The new Sec. 410.76(b) sets forth new qualifications for clinical
nurse specialists. Section 410.76(c) describes the conditions of
coverage for clinical nurse specialists' services, defines the
collaboration process, and paragraph (d) lists the requirements for
services furnished incident to the professional services of a clinical
nurse specialist.
New Sec. Sec. 405.520(a), (b), and (c) of this rule provide the
general rule, requirements, and civil monetary penalties for clinical
nurse specialists. A new paragraph (c) is added to Sec. 414.56 of this
rule to set forth the payment amounts for clinical nurse specialists'
services.
Comment: Numerous nurses associations commented specifically about
the qualifications for clinical nurse specialists at Sec. 410.76(b) of
the proposed rule. They suggested that the qualifications for clinical
nurse specialists be amended to require that a clinical nurse
specialist be an individual who is a registered nurse currently
licensed to practice as in the State in which he or she practices and
have a master's degree in a defined clinical area of nursing from an
accredited educational institution. The commenters emphasized that
there is no need to provide for an exception as included in the
proposed qualifications
[[Page 58875]]
for clinical nurse specialists, because the nursing profession has long
held consensus that clinical nurse specialists be required to have a
master's degree. Additionally, they believed that the definition of a
clinical nurse specialist under the BBA makes it clear that a clinical
nurse specialist must hold a master's degree. Furthermore, they stated
that the proposed exception requirement contains erroneous information
about the educational focus of clinical nurse specialist programs that
may be preparatory both for primary care and specialty care.
Response: Prior to the BBA, section 2160 of the Medicare Carriers
Manual required that a clinical nurse specialist had to satisfy the
applicable requirements for a clinical nurse specialist in the State in
which the services are performed. In the absence of State requirements,
Medicare contractors had the discretion to determine whether an
individual's qualifications warranted Medicare payment for clinical
nurse specialist services. However, the BBA, which established
qualifications for clinical nurse specialists, defines a clinical nurse
specialist as an individual who is a registered nurse and is licensed
to practice nursing in the State in which the services are performed
and holds a master's degree in a defined clinical area of nursing from
an accredited educational institution. Therefore, we will implement the
BBA qualifications for clinical nurse specialists without an exception
for clinical nurse specialists who do not possess a master's degree.
Comment: One independently practicing clinical nurse specialist
argued that access to psychiatric clinical nurse specialists, in
particular, is being denied even though they are the only mental health
providers, other than psychiatrists, whose education, experience, and
legal scope of practice include the management of co-morbid medical and
psychiatric illness. Psychiatric clinical nurse specialists also
provide services that include patient and family education to manage
symptoms of illness and medications, evaluation and management of side
effects, identification of adverse reactions, and evaluation of
effectiveness of medications and psychotherapy. The commenter explained
that all clinical nurse specialists in psychiatric nursing hold
master's or doctoral degrees; have completed 2-years post-graduate,
supervised, clinical experience; have passed a national board
certification exam; and are required to obtain 75 hours of continuing
education credit every 5 years. The commenter concluded that
psychiatric clinical nurse specialists are the only group of mental
health providers whose practice is being restricted.
Response: Psychotherapy services are listed in the AMA's CPT coding
book as ``physician services''. Nurse practitioners and clinical nurse
specialists are authorized by the Medicare program to bill for services
that would otherwise be furnished by a physician or incident to a
physician's services. Accordingly, it is appropriate for the Medicare
program to pay these nonphysician practitioners who have the specific
training mentioned for psychotherapy services that are determined to be
medically reasonable and necessary.
Result of evaluation of comments: We have determined that for
purposes of Medicare Part B payment, a clinical nurse specialist must--
<bullet> Be a registered nurse who is currently licensed to
practice in the State where he or she practices and be authorized to
perform the services of a clinical nurse specialist in accordance with
State law;
<bullet> Have a master's degree in a defined clinical area of
nursing from an accredited educational institution; and
<bullet> Be certified as a clinical nurse specialist by the
American Nurses Credentialing Center.
Coverage and Payment for Certified Nurse-Midwives' Services
Section 13554 of OBRA 1993 (Pub. L. 103-66) amended section
1861(gg)(2) of the Act to revise the definition of certified nurse-
midwife. The revision eliminated a limitation on coverage and included,
as covered services, those services furnished by certified nurse-
midwives outside the maternity cycle. This change was made effective
for services furnished on or after January 1, 1994.
A new Sec. 410.77 of this rule lists the qualifications for
certified nurse-midwives and provides the conditions for coverage of
certified nurse-midwives' services. Paragraph (d) of Sec. 410.77 lists
the coverage requirements for the professional services of certified
nurse-midwives, while paragraph (c) lists the requirements for services
furnished incident to the professional services of a certified nurse-
midwife.
The comments that we received from a major college representing
certified nurse-midwives mainly addressed the proposed qualifications
for these individuals.
Comment: The commenter urged that the qualifications for certified
nurse-midwives be revised to read that the individual must--
(1) Be legally authorized to practice as a certified nurse-midwife
under State law or regulations;
(2) Have successfully completed a program of study and clinical
experience accredited by an accrediting body approved by the U.S.
Department of Education; and
(3) Be currently certified as a nurse-midwife by the American
College of Nurse-Midwives or by the American College of Nurse-Midwives
Certification Council.
The college believed that these revised qualifications at
Sec. 410.77(a) would eliminate the possibility of individuals being
able to practice as certified nurse-midwives in the Medicare program
without having to take and pass appropriate certification examinations
that are explicitly linked to a demonstrated mastery of the ``core
competencies'' for basic nurse-midwife practice. These revised
qualifications would, the commenter stated, also assure greater
uniformity of quality and competency among certified nurse-midwives who
wish to be paid by Medicare for services that they provide to Medicare
patients.
Response: Section 1861(gg)(2) of the Act states that the term,
``certified nurse-midwife'' means a registered nurse who has
successfully completed a program of study and clinical experience
meeting guidelines prescribed by the Secretary, or has been certified
by an organization recognized by the Secretary. Accordingly, we are
implementing qualifications for certified nurse-midwives that implement
these statutory requirements.
Comment: The other comment that the college representing certified
nurse-midwives made was directed toward the criteria for determining
payment to certified nurse-midwives for their professional services.
The college stated that Sec. 410.77(d)(1) should clarify that, while
supervision of nonphysician staff by a nurse-midwife does not
constitute a professional service, the service provided by the
nonphysician may be paid to the certified nurse-midwife if it meets the
requirements of a service incident to his or her service.
Additionally, the college suggested that Sec. 410.77(d)(3) be
revised to state that Medicare will pay a certified nurse-midwife for
all services that he or she is legally authorized under State law or
regulations to furnish as a certified nurse-midwife in the State, if
those services are also covered services under the Medicare program.
The college suggested this change because it maintains that certified
nurse-midwives are qualified to perform ``other services'' that might
not be interpreted to include
[[Page 58876]]
newborn care or certain primary care services, or primary care case
management in a managed care context, and certain States license them
to perform these ``other services.''
Response: The requirements pertaining to services furnished
incident to the professional services of a certified nurse-midwife are
listed separately at Sec. 410.77(c) of the proposed rule. We do not
want to confuse the requirements for the professional services of
certified nurse-midwives with the requirements that pertain to services
furnished incident to the professional services of certified nurse
midwives.
Section 1861(gg)(1) defines the term, ``certified nurse-midwife
services'' as services furnished by a certified nurse-midwife and
services and supplies furnished as an incident to the nurse-midwife's
service which the certified nurse-midwife is legally authorized to
perform under State law as would otherwise be covered if furnished by a
physician or as an incident to a physicians' service. Therefore, we
agree with the statement made by the commenter that coverage of the
professional services of certified nurse-midwives are not restricted to
newborn care, certain primary care services, or primary care case
management services if State law authorizes them to furnish ``other
services.''
Result of Evaluation of Comments: We have determined that for
purposes of Medicare Part B payment, a nurse-midwife must--
<bullet> Be a registered nurse who is legally authorized to
practice as a nurse-midwife in the State where services are performed;
<bullet> Have successfully completed a program of study and
clinical experience for nurse-midwives that is accredited by an
accrediting body approved by the U.S. Department of Education; and
<bullet> Be certified as a nurse-midwife by the American College of
Nurse-Midwives or the American College of Nurse-Midwives Certification
Council. The Secretary reserves the right to determine that these
accrediting bodies' standards are no longer sufficient for qualifying
nurse midwives for Medicare Part B payment.
Also, a nurse-midwife may provide services that he or she is
legally authorized to perform under State law as a nurse-midwife, if
the services would otherwise be covered by the Medicare program when
furnished by a physician or incident to a physicians' professional
services.
Coverage and Payment for Physician Assistants' Services Subsequent to
BBA
Effective for services furnished on or after January 1, 1998, the
majority of the conditions for coverage of physician assistants'
services as indicated by new Secs. 410.74(a) and (b) remain unchanged
with the exception of the condition for coverage of physician
assistants' services furnished in certain areas and settings. Section
4512 of BBA removes the restrictions on the sites in which physician
assistants may furnish their professional services, regardless of
whether the settings are located in rural or urban areas. Physician
assistants are authorized to furnish their professional services as
independent nonphysician practitioners to practically all providers of
services and suppliers of services, provided the facility or other
provider of services do not charge or is not paid any amounts with
respect to the furnishing of physician assistants' professional
services. Accordingly, separate payment may be made for physician
assistants' services in all settings, except in RHCs and FQHCs;
physician assistant services are included as RHC and FQHC services for
which Medicare payment is made based on an all-inclusive payment rate
that the program makes to these facilities.
In new Sec. 410.74(c), we proposed to amend the qualifications for
physician assistants to recognize certification of physician assistants
by the National Board of Certification of Orthopedic Physician
Assistants. These qualifications would also have recognized academic
programs for physician assistants that are accredited by either the
Commission on Accreditation of Allied Health Education Programs or the
American Society of Orthopedic Physician Assistants.
Additionally, effective January 1, 1998, physician assistants have
the option of furnishing services under a different employment
arrangement with a physician. They can furnish services as employees of
a physician under a W-2 form employment arrangement or they can furnish
services as an independent contractor to a physician and receive a 1099
form. Under either arrangement, the employer of the physician assistant
must bill the program for physician assistants' services as required
under Sec. 410.150(b)(15). Moreover, when an individual furnishes
services ``incident to'' the professional services of a physician
assistant, these ancillary services must meet the requirements under
Sec. 410.74(a)(2)(vi)(B).
The Medicare payment amount for a physician assistant's
professional services as of January 1, 1998, as stated in new paragraph
(d) of Sec. 414.52, remains at 80 percent of the lesser of either the
actual charge or 85 percent of the physician fee schedule amount for
professional services. Also, new Sec. 405.520 provides the general
rule, requirements, and civil monetary penalties for physician
assistants who furnish services under the Medicare program.
We received a total of 140 comments on the proposed physician
assistant qualifications. Half of all of the commenters strongly
opposed the inclusion of orthopedic physician assistants (OPAs) under
the qualifications for physician assistants. The others commenting on
the inclusion of OPAs applauded and supported their inclusion and
suggested a few minor changes to the qualifications overall.
Comment: The commenters who strongly opposed the proposed physician
assistant qualifications included professional organizations,
individual physician assistants, State level professional societies and
academies, congressional representatives, educational institutions,
hospitals, and a board of medical examiners. The commenters stated
overwhelmingly that the proposed qualifications for physician
assistants inappropriately included orthopedic physician assistants and
that orthopedic physician assistants are not physician assistants even
if the acronyms (PA and OPA) appear to be similar. The majority of
commenters who opposed the inclusion of OPAs noted that they would not
object, however, if the Congress implemented a Medicare benefit that
recognizes orthopedic physician assistants as separate independent
nonphysician practitioners, and, in that case, there should be a
payment differential in the amounts of payment made to physician
assistants and orthopedic physician assistants that would reflect a
higher payment to PAs because they have a greater career investment,
patient care responsibility, and higher malpractice insurance costs
than OPAs.
The commenters stated that PAs and OPAs do not receive the same
education and training, accreditation, certification, or State
licensure, and their continuing medical education requirements are not
similar. These commenters stated that the curricula for the physician
assistant educational programs reveal that these programs emphasized
primary care involving diagnosis and treatment of five major clinical
disciplines (medicine, surgery, pediatrics, psychiatry, and
obstetrics), as well as pharmacology. The training period for
[[Page 58877]]
PAs lasts anywhere from 24 to 28 months. The orthopedic educational
programs train technical assistants to assist orthopedic surgeons, with
an emphasis on orthopedic disease and injury, management of equipment
and supplies, operating room techniques, cast application and removal,
office procedures, and orientation to prosthetics and orthotics. The
training period for OPAs lasted for no more than 24 months.
The commenters asserted that the Commission on Accreditation of
Allied Health Education Programs (CAAHEP) must accredit all physician
assistant educational programs. CAAHEP is a national independent
accrediting agency that is recognized by the U.S. Department of
Education and sponsored by medical, allied health, and educational
organizations. However, there are currently no existing OPA programs to
be accredited. The AMA accredited eight orthopedic physician assistant
educational programs from 1969 to 1974. Accreditation ceased in 1974
when the American Academy of Orthopedic Surgeons withdrew sponsorship
of the accreditation process.
The commenters stated that PAs are required to take and pass a
national examination after graduation from a physician assistant
educational program that is certified by the National Council on
Certification of Physician Assistants (NCCPA). The NCCPA national
certification examination is open only to those individuals who have
graduated from accredited physician assistant educational programs. The
NCCPA, which provides the certified national examination, is an
independent organization whose governing board has representatives from
the American Medical Association, American Hospital Association,
American Academy of Family Physicians, American Academy of Pediatrics,
American College of Physicians, American College of Surgeons, National
Medical Association, Association of American Medical Schools,
Federation of State Medical Boards, U.S. Department of Defense,
Association of Physician Assistant Programs, and the American Academy
of Physician Assistants. The NCCPA also includes three public members.
OPAs who have had on-the-job training or other mid-level
paraprofessionals who challenge the exam and have had on-the-job
training may take the examination for OPAs that is certified by the
National Board on Certification for Orthopedic Physician Assistants
(NBCOPA). The NBCOPA certification examination is an open examination
and is currently reached through the Professional Testing Corporation,
a for-profit business that administers tests for various organizations.
The NBCOPA is comprised of six members of the American Society of
Orthopedic Physician Assistants (ASOPA), the orthopedic physician
assistant professional society, and an unspecified number of advisory
members who are presumably non-voting physicians and educators. There
is no organized medical group that sponsors or oversees the national
certification examination for OPAs other than ASOPA.
The commenters emphasized that all States except Mississippi
license and regulate PAs. Forty-three States, the District of Columbia,
and Guam have enacted laws to authorize PAs to prescribe medicine.
Thirty-three States authorize PAs to write prescriptions for controlled
medications. Conversely, only Tennessee specifically licenses OPAs.
Tennessee's licensure of OPAs is, however, separate from its licensure
of PAs. California and New York have laws referencing OPAs, but the
laws refer to OPAs as distinct from PAs. California refers to OPAs who
successfully completed training as OPAs from an approved California
orthopedic physician assistant educational program in any year between
1971 to 1974 to perform only those orthopedic medical tasks that a
physician and surgeon may delegate. New York defines the qualifications
for PAs in terms broad enough to include OPAs. The New York State
regulations do not limit the acceptable examination to the NCCPA
certification examination. Therefore, the NBCOPA certification
examination could be considered to adequately assess entry level skills
for the physician assistant profession. None of the other States,
however, recognize OPAs, and none of the States specifically grant OPAs
prescribing privileges.
Additionally, the commenters explained that PAs are required to log
100-hours of continuing medical education over a 2-year cycle and to
take a recertification exam every 6 years to maintain certification as
PAs. On the other hand, OPAs are required to complete 120 hours of
continuing medical education every 4-years or retake the initial NBCOPA
certification examination to maintain certification as OPAs.
The professional organizations representing PAs and numerous
independent PAs and congressional representatives argued that the
proposed changes to the PA qualifications run counter to our twin goals
of controlling costs to the Medicare program and maintaining the
quality of services furnished to Medicare beneficiaries. There are
approximately 49,000 surgical technologists and 3,000 registered nurse
first assistants and an uncounted number of unlicensed medical school
graduates (for example, from other countries). These individuals could
potentially qualify as PAs under the proposed qualifications by getting
the requisite orthopedic work experience and passing the orthopedic
physician assistant examination that is certified by NBCOPA. Thus, the
number of individuals who could qualify for payment under the PA
benefit ultimately is substantial.
Additionally, these commenters argued that the proposal to include
OPAs as PAs runs counter to congressional intent because the BBA, which
amends coverage payment for PAs, does not include any mention of OPAs.
They state that the debate on the BBA provisions for physician
assistants, nurse practitioners, and clinical nurse specialists did not
include any discussion of orthopedic physician assistants or any other
types of physician extenders, nor did the Congressional Budget Office
consider orthopedic physician assistants or other types of specialty
physician extenders when projecting the costs of physician assistant
services under the BBA. Furthermore, these commenters stated that the
primary sponsors of the 1977 Rural Health Clinic Services Act
acknowledged the educational preparation of PAs to provide a wide range
of primary care services to Medicare beneficiaries living in areas
experiencing a shortage of primary care physicians. While orthopedic
technicians may provide valuable, specialized services in assisting
orthopedic surgeons, they do not have an educational background in
primary care. Consequently, they are not qualified to provide the wide
range of primary care services that the Congress anticipated when it
recognized the need to cover and pay for the services of PAs under
Medicare.
Finally, the commenters urged us to require that, in order for an
individual to qualify as a PA under Medicare, he or she must (1)
possess State approval to practice as a PA, and (2) demonstrate either
graduation from a physician assistant educational program accredited by
CAAHEP or certification by NCCPA.
The commenters who supported the inclusion of OPAs under the
physician assistant benefit were represented by a national society and
academy, orthopedic surgeons, independent orthopedic physician
assistants,
[[Page 58878]]
hospitals, universities, and organizations that provide orthopedic
surgical services. The national society representing OPAs declared that
our clarification of the PA qualifications does not relate to payment
because orthopedic surgeons are already paid for many services provided
by OPAs incident to their professional services. Rather, it believes
that the clarification is about recognition of OPAs.
The national academy representing orthopedic surgeons, numerous
independent orthopedic surgeons, and OPAs stated that OPAs are
specially trained to assist orthopedic surgeons in surgical procedures
and other services involving the total care of patients with orthopedic
conditions of the anatomy and pathophysiology of the musculoskeletal
organ system. Commenters state that OPAs receive extensive training
that includes rotations in general medicine and surgery, history and
physical assessment, and pharmacology. Additionally, they say, OPAs are
trained to obtain medical histories, perform physical examinations,
assist the physician in developing and implementing patient management
plans, perform common laboratory, radiologic, and other routine
diagnostic procedures, and provide injections, immunizations, suturing
and wound care, among other services. Other services that these groups
have stated that OPAs may perform include the application, fabrication
and removal of casts, splints, braces and orthopedic hardware, emergent
care of trauma patients, pre- and post-operative care, and serving as
first and second assistants to orthopedic surgeons for all procedures.
A few commenters noted that the only orthopedic experience that the
primary care physician assistants have is received during a 6-week
rotation within the 4-year primary care educational program.
Many orthopedic surgeons and others stated that the specialty
training that OPAs receive has enabled them to become extremely
valuable to their practices freeing up orthopedic surgeons to perform
other tasks. Also, some commenters stated that they have found PAs and
OPAs to be equally competent and in some cases, OPAs have proven to be
more competent than PAs. Therefore, OPAs are very quickly becoming an
integral part of their patient care teams. A professional organization
commented that the inclusion of OPAs under the PA benefit should not
result in exorbitant costs to the Medicare program because there are
only approximately 1,000 OPAs who could meet the proposed PA
qualifications. Also, when Tennessee established State licensure for
OPAs, the State Comptroller's office found that there was an increase
in State revenues from fees collected and a slight, but not
significant, increase in State expenditures for administering the
program.
The national society representing OPAs suggested specific language
be added to the proposed PA qualifications to require formal education
programs for OPAs.
Response: After reviewing more closely information about the
distinctions between PAs and OPAs, and after reviewing the comments
that we received on the proposal to include OPAs as PAs, we have
determined that it would not be appropriate to treat OPAs in the same
way as PAs. There are substantial differences in education and
training, certification examinations, accreditation of educational
programs, and State licensure and regulation of PAs and OPAs.
Additionally, we believe that the 1977 Rural Health Clinic Services
Act, which first recognized and paid for the services of PAs under Part
B of the Medicare program, would have specifically recognized OPAs as
within its scope if it intended to do so. We also believe that a
significant number of individuals, exceeding the approximately 1,000
currently practicing OPAs, could qualify as PAs under the proposed rule
because the national certification examination for OPAs is currently
open to other mid-level nonphysician practitioners who challenge the
examination and have had on-the-job training.
Comment: We did not specifically solicit public comment in the
proposed rule on the BBA provision that authorized PAs to provide
services under an arrangement as independent contractors, in addition
to performing services as an employee of entities or individuals such
as a physician, medical group, professional corporation, hospital,
skilled nursing facility, or nursing facility. However, we discussed,
in the background section of the proposed rule, that effective January
1, 1998, PAs have the option of furnishing services under an
independent contractor arrangement. Under either arrangement, we
explained that the employer of the PA must bill the program for
services furnished by the PA. As a result of this discussion, one
commenter stated that, generally, PAs have been under the direction of
a physician, and they have not been viewed as independent contractors.
Therefore, the commenter emphasized that clarification is needed about
PAs performing in an independent contractor employment relationship.
Response: Regardless of whether a PA performs services under an
employment relationship or under an independent contractor
relationship, the Medicare statute requires that he or she furnish
services under the general supervision of a physician, and the employer
of the PA must always bill for the services furnished.
However, just as we adopt the Internal Revenue Service's definition
of an employer/employee employment relationship, we also adopt the
Internal Revenue Service's definition of an independent contractor
relationship.
Some of the distinctions between an employer/employee and an
independent contractor relationship are that, under an independent
contractor relationship, the employer does not generally have to
withhold or pay any taxes on payments to independent contractors and
the employer has virtually no behavioral or financial control over the
independent contractor. That is, under an independent contractor
relationship, the independent contractor works autonomously without any
instructions from his or her employer about when, where, and how to
work. The contractor is engaged to perform services for a specific
project or period of time, for which he or she is paid at the
completion of the project. Independent contractors can make a profit or
loss. The services that the independent contractor performs may not be
a key aspect of the employer's regular business and, therefore, an
independent contractor may have a significant investment in the
facilities he or she uses in performing services for the employer.
Additionally, the employer of an independent contractor may not provide
employee-type benefits such as insurance, a pension plan, vacation pay,
or sick pay.
Result of evaluation of comments: We have determined that for
purposes of Medicare Part B payment, a physician assistant is an
individual who--
<bullet> Has graduated from a physician assistant educational
program that is accredited by the National Commission on Accreditation
of Allied Health Education Programs;
<bullet> Has passed the national certification examination that is
certified by the National Commission on Certification of Physician
Assistants; and
<bullet> Is licensed by the State to practice as a physician
assistant.
[[Page 58879]]
E. Payment for Teleconsultations in Rural Health Professional Shortage
Areas
In section 4206 of BBA, the Congress required that, not later than
January 1, 1999, Medicare Part B pay for professional consultations by
a physician via interactive telecommunications systems
(teleconsultations).
Under section 4206(a) of BBA, payment may be made under Part B,
provided the teleconsultation service is furnished to a beneficiary who
resides in a county in a rural area designated as a Health Professional
Shortage Area (HPSA). This payment is notwithstanding that the
individual physician or practitioner providing the professional
consultation is not at the same location as the physician or
practitioner furnishing the service to that beneficiary. (For the
purposes of convenience, in this section the term ``practitioner'' is
used to mean physicians and practitioners as specified.)
Section 4206(b) of BBA also required that the Secretary establish a
methodology for determining the amount of payments made for a
teleconsultation within the following parameters:
<bullet> The payment is to be shared between the referring
practitioner and the consulting practitioner.
<bullet> The amount of the payment is not to exceed the current fee
schedule amount that would be paid to the consulting practitioner.
<bullet> The payment is not to include any reimbursement for any
telephone line charges or any facility fees, and a beneficiary may not
be billed for these charges or fees.
<bullet> The payment is to be subject to the coinsurance and
deductible requirements under section 1833 (a)(1) and (b) of the Act.
<bullet> The payment differential of section 1848(a)(3) of the Act
is to be applied to services furnished by nonparticipating physicians.
<bullet> The provisions of sections 1848(g) and 1842(b)(18) of the
Act are to apply.
<bullet> Further, payment for the consultation service is to be
increased annually by the update factor for physicians' services
determined under section 1848(d) of the Act.
In addition, the statute directs that, in establishing the
methodology for determining the amount of payment, the Secretary take
into account the findings of the report required by section 192 of the
Health Insurance Portability and Accountability Act of 1996 (Public Law
104-191), the findings of the report required by section 4206(c) of
BBA, and any other findings related to clinical efficacy and cost-
effectiveness of telemedicine applications.
Provisions of HCFA-1906-P
On June 22, 1998, we published a proposed rule titled ``Payment for
Teleconsultations in Rural Health Professional Shortage Areas'' (HCFA-
1906-P) (63 FR 33882) that would implement the provisions of section
4206 of the BBA addressing Medicare reimbursement for telehealth
services.
Regulatory Provisions
In proposed Sec. 410.75(a)(1), we required that as a condition for
Medicare Part B payment for a teleconsultation, the referring and the
consulting practitioner be any of the following:
<bullet> A physician as described in existing Sec. 410.20.
<bullet> A physician assistant as defined in existing Sec. 491.2.
<bullet> A nurse practitioner as defined in existing Sec. 491.2.
<bullet> A clinical nurse specialist as described in existing
Sec. 424.11(e)(6).
<bullet> A certified registered nurse anesthetist or
anesthesiologist's assistant as defined in existing Sec. 410.69.
<bullet> A certified nurse-midwife as defined in existing
Sec. 405.2401.
<bullet> A clinical social worker as defined in section 1861(hh)(1)
of the Act.
<bullet> A clinical psychologist as described in existing
Sec. 417.416(d)(2).
We required, in proposed Sec. 410.75(a)(2), that teleconsultation
services be furnished to a beneficiary residing in a rural area as
defined in section 1886(d)(2)(D) of the Act that is designated as an
HPSA under section 332(a)(1)(A) of the Public Health Service Act. For
purposes of this requirement, the beneficiary is deemed to be residing
in such an area if the teleconsultation presentation takes place in
such an area.
In proposed Secs. 410.75(a)(3) through 410.75(a)(5) we specified
further that teleconsultations must meet the following requirements in
order to be covered by Medicare Part B:
<bullet> The medical examination of the beneficiary must be under
the control of the consultant practitioner.
<bullet> The consultation must involve the participation of the
referring practitioner, as appropriate to the medical needs of the
patient, and as needed to provide information to