Outpatient Hospitals Exempt from 2018 Therapy Cap

January 4, 2018
Rick Gawenda

Since Congress did not repeal the annual therapy cap or extend the therapy cap exception process into 2018, most outpatient therapy settings will now be dealing with a hard therapy cap of $2010.00 for physical therapy and speech-language pathology services combined and a separate $2010.00 for occupational therapy services. Why did I say most outpatient therapy settings will be dealing with a hard therapy cap in calendar year 2018? That’s because outpatient hospitals, but not critical access hospitals (CAHs), will be exempt from the 2018 annual therapy cap. Continue reading below to see why outpatient hospitals, but not CAHs, are exempt from the 2018 therapy cap with the references to support the information provided.

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      1. I understand outpatient Hospital therapy does not have a cap; however, do their allowables count towards private practice outpatient caps once the patient gets move to a clinic?

          1. Can you please differentiate for me the definition of Outpatient Hospital and Outpatient Hospital departments. I work for a large hospital, that would have Medicare Part B therapy with Observation beds, ED services, and outpatient surgery centers. We also have 18 Outpatient therapy Clinics that bill with Hospital billing. Are you saying that none of these services (within the hospital and the outpatient clinics) will have a therapy cap? or Just the services within the hospital? Also above it states that there is no exception process for any site except outpatient hospitals. That sounds like to me that Outpatient hospital still has a cap, but is allowable to use the KX modifier beyond that as the exception. That sounds very different to me than “Outpatient Hospitals Exempt from 2018 Therapy Cap”… any guidance is appreciated.

          2. As it stands today, January 5, 2018, outpatient hospitals are exempt from the 2018 therapy cap. This means that therapy services provided under the hospital tax identification number would be exempt from the therapy cap. No KX modifier would be required.

    1. Technically, Congress has no timeframe to either repeal the therapy cap or extend the therapy cap exception process. What they have to do by January 19, 2018 is pass legislation to fund the government to avoid a government shut down.

  1. Hi Rick, We are an outpatient department of a critical access hospital. Does the therapy cap apply to CAH? Thanks.

  2. I have a question re: functional reporting. I am an outpatient rehab facility. If a patient has had 9 visits in 2017 and the 10th visit falls on jan.2nd, 2018, do i use the G-codes at the 10th visit or start over as Jan 2nd being the 1st visit?
    Would appreciate your response.