October 5, 2020 | Net Health

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Medicare Proposes Cuts for Rehab Therapists; Deadline Today to Submit Comments

Outpatient physical and other rehab therapy practices may face payment cuts in 2021. The new Medicare Physician Fee Schedule (MPFS) proposed by the Center for Medicare & Medicaid Services (CMS) will reduce reimbursements by about 9% for physical therapy, occupational therapy, and other rehab therapy practices.

Deadline to Submit Comments to CMS Today by 5 p.m.

We encourage our clients and members of the community to express concerns and to stop these reductions. Today is the deadline to submit comments to CMS at their public comments portal.APTA’s Regulatory Action Center2 provides sample letters and suggested actions.

These payment reductions specifically target Medicare Part B codes tied to physical and other rehab therapists’ billing. They’re a result of CMS’s budget neutrality policy and the decision to increase evaluation and management (E/M) code payments to primary care physicians, necessitating reductions for other payment codes. Not unexpectedly, many organizations, including the American Physical Therapy Association (APTA) oppose the cuts. 

Physical therapy and other private practices have been challenged in adapting to the pandemic and anticipating continued influxes of patients in 2021. This news is distressing, especially because outpatient physical therapy is a critical healthcare service. The important thing is to get ready for the changes and remember there’s still time to take action to eliminate or reduce their impact.  

How Reductions May Affect Private Practices

Changes to physical therapy billing guidelines comes at a challenging time for physical and occupational therapists in private practice. The COVID-19 pandemic led many patients to delay necessary care leading to financial losses that will now be compounded when patients return and their care is reimbursed at lower rates.3 Even worse, CMS plans to cut 15 percent in 2022 from therapy assistant fees.4 Other provider groups, such as surgeons,5 speech language pathologists (SLPs),and more7 are seeing reductions too. Organizations such as the American Medical Association (AMA) stress that they do not oppose the increased payments for primary care, but they strongly urge CMS to waive the budget neutrality provision that will hurt specific healthcare fields.8

The Importance of Physical Therapy and Other Rehab Specialties

The importance of direct access physical therapy in our healthcare system can’t be overstated. Cutting reimbursements could diminish care for rehab patients, reduce the healthcare system’s efficiency, and ultimately increase hospital readmission rates.9

As APTA’s statement points out, “Upon discharge from the hospital, many COVID-19 patients require therapy for their long-term recovery. Moreover, therapy services remain crucial as 10,000 baby boomers turn 65 every day and want to age in place.”10 The clear danger is that patients could lose access to the essential care they need at the time they need it most. 

Action Item: Ask CMS to Waive Budget Neutrality 

Although most practices also serve non-Medicare patients, Medicare Part B services are a large part of their businesses,11 many of which operate on low margins already. Given the devastating effects of the Coronavirus pandemic, there’s little justification to single out specific provider groups for cuts in order to increase funds for others. Now is the time for CMS to waive its budget neutrality policy.

Ensure Compliance with a Software Solution Tailored for Private Practices

To prepare for the new physical therapy guidelines, it’s a good idea to use software that delivers electronic health records (EHRs) and billing in one package. 

Net Heath Therapy (ReDoc®) for Private Practice, Hospital Outpatient Clinics, and Acute Care ReDoc for private practice is designed to relieve some of the compliance burden so that therapists can spend more time with patients and less time on administrative tasks.


1Regulations.gov, “Comments on CMS-2020-0088-1604,” September 29, 2020.

2American Physical Therapy Association, “Regulatory Action Center,” no date.

3American Physical Therapy Association, “Therapy Associations Call on Congress and CMS to Stop Medicare Payment Cuts,” August 4, 2020.

4Net Health, “Understanding the Proposed CMS Cuts to Medicare Therapy Reimbursements,” August 20, 2020.

5LaPointe J, “Providers Want Budget Neutrality Waived for E/M Payment Changes,” August 13, 2020.

6American Speech-Language-Hearing Association, “ASHA Continues to Pressure Congress, Administration, to Stop Medicare Cuts,” September 23, 2020.

7Landi H, “CMS Proposes Changes to Docs’ Medicare Payments for 2021, Including Payment Cuts for Some Specialties,” August 4, 2020.

8American Medical Association, “Medicare Moving Forward with Planned E/M Office Visit Changes,” August 4, 2020.

9Net Health, “Understanding the Proposed CMS Cuts to Medicare Therapy Reimbursements,” August 20, 2020.

10American Physical Therapy Association, “Therapy Associations Call on Congress and CMS to Stop Medicare Payment Cuts,” August 4, 2020.

11Net Health, “Understanding the Proposed CMS Cuts to Medicare Therapy Reimbursements,” August 20, 2020.

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