April 26, 2021 | Sarah Irey, PT, MSPT

3 Minute Read

Who Rules When it Comes to Therapy Coding and Billing? The Payer Rules.

As if it’s not stressful enough for clinicians to balance scheduling, treating patients, and creating defensible documentation, they’re also expected to know the ins and outs of physical therapy billing and coding. Unfortunately, untangling the rules of insurance payers can often feel like a full-time job. This is where Net Health Therapy can help!

Having an EHR that helps remind your therapists about the payer rules is a way to manage the different pieces of the coding and billing puzzle. Net Health Therapy is excited to announce its Payer Rules feature that allows you to set your clinic up for success.  Using this feature, you can match procedures to diagnoses, set procedures to be excluded from use, and customize the procedure to procedure edits — all specific to payers. This helps take the guesswork out of coding and billing coverage so your therapists can focus on their patients.

Before getting started with Payer Rules in Net Health Therapy, you’ll need to know what your different payers will allow when it comes to therapy services. Figuring out what insurance payers deem “reasonable and necessary” is crucial; unfortunately, it can also be confusing and difficult.

In this blog, we’ll start to piece together the puzzle to help you figure out what you can and can’t do when it comes to therapy coding and billing.  The payer puzzle has three distinct parts:

  • Determining who will cover the services.
  • Locating and regularly reviewing coverage guidance.
  • Educating and communicating the guidelines with your staff.

Let’s get started putting the pieces together. Consider these three questions:

1. How do you determine who will cover the services?

To determine who will cover the services, you’ll need to answer two basic questions:

  • Who is paying for the service? Whether the payer is a government program or commercial insurer will affect how and where you research.
  • In what state is the service being provided?  Remember, regardless of the individual payer guidance, your state’s Practice Act provides rules about what you can do based on your clinical license.

2. How do you locate and regularly review coverage guidance?

Let’s work through an example by focusing on Medicare Part B as the payer.

Find your Medicare Administrative Contractor (MAC):

When caring for patients who have Medicare Part B, coverage is first defined by the National Coverage Determination (NCD) established by Medicare.  NCDs outline what items and services Medicare considers reasonable and necessary to care for your patients. If an NCD doesn’t exist, providers need to look next to their Medicare Administrative Contractor (MAC) for guidance.1

Medicare contracts private health care insurers, known as MACs, to process claims for fee-for-services beneficiaries. MACs are assigned to a regional area, so who your MAC is depends on what state you practice in.2

As of December 2020, there are 12 MACs for Medicare Part A/B services. (2)  You can figure out who your MAC is by referencing the A/B MAC Jurisdiction Map on the CMS website:  Find your state, find your MAC!

It’s important to know your MAC because this will allow you to find their coverage guidelines, which are called Local Coverage Determinations, or LCDs. MACs establish LCDs that help them explain what they will, or sometimes won’t, pay for (2).  MACs use clinical guidelines, consensus documents, or expert consultation to develop LCDs.3

Find your Local Coverage Determinations (LCDs):

After finding your MAC assignment, visit the Medicare Coverage Database (MCD) to search for LCDs that may impact your practice.

Using keywords like Physical Therapy, Occupational Therapy, or Speech-Language Pathology is a great place to start your search.  Also consider using keywords like biofeedback, dysphagia, or debridement to find guidelines on specific services that you might provide in your clinic.  You likely have multiple LCDs and articles that relate to your practice, so take some time to search thoroughly.

Your search results will likely display both LCDs and articles related to your keywords.  This is an important point because procedure and diagnosis codes are no longer contained within LCDs. Instead, they are placed in billing and coding policy articles that relate to the LCD.  This means you’ll need to look at both the LCD and the related articles. Medicare did this to make the guidelines easier to find and to make the revision and reconsideration process a bit simpler. Links to related articles can be found at the end of the LCD and vice versa.4

LCDs and articles can feel overwhelming and confusing, but you’ll quickly learn how to navigate them.  These documents may provide guidance on medical necessity of procedures, documentation guidelines, and more.5

It’s also important to know that LCDs are reviewed at least annually by MACs, but revisions to these policies can take place at any time, without warning.  Consider establishing a systematic review process to look for updates on a regular basis so you can stay up to date on changes.

Commercial payers:

Commercial payers develop their own rules for therapy coding and billing.  Sometimes these match Medicare coverage and sometimes they don’t.6 In order to determine what a commercial payer will cover for therapy services, you’ll need to visit the website for each insurance.

Always remember, your state’s Practice Act will also dictate services that you can, or can’t, provide as a therapist or assistant.

3. How do you educate and communicate with your staff?

Once you have coverage guidelines figured out, it’s important to help your staff understand the guidelines.  Consider using staff in-services, continuing education, and written communications to facilitate their learning.  Apply this approach to the use of Net Health Therapy’s Payer Rules and your clinic is unlikely to be puzzled by therapy billing and coding anymore!

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DISCLAIMER: The information contained in this article is a summary and intended for educational purposes only. Interpretation of coverage and any guidance should be reviewed with your legal and compliance teams for applicability to your practice or organization.


1Medicare Coverage Determination Process https://www.cms.gov/Medicare/Coverage/DeterminationProcess Accessed 25 February 2021.

2What is a MAC, https://www.cms.gov/Medicare/Medicare-Contracting/Medicare-Administrative-Contractors/What-is-a-MAC . Accessed 25 February 2021.

3Medicare Program Integrity Manual, Chapter 13. https://www.cms.gov/Regulations-and-Guidance/Guidance/Manuals/Downloads/pim83c13.pdf

4Local Coverage Determination (LCD) Process Modernization Q&A https://www.cms.gov/Medicare/Coverage/DeterminationProcess/Downloads/LCD_QsAs.pdf

5Local Coverage Determinations. APTA, 24 October 2018. https://www.apta.org/your-practice/payment/medicare-payment/coverage-issues/local-coverage-determinations-lcds

6Humana Joins Aetna and Cigna in Lifting Edits on Code Pairs. APTA, 17 February 2021. https://www.apta.org/news/2021/02/17/humana-lifts-ncci-edits

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