In the early morning hours of February 9th, the permanent repeal of the therapy cap was included in the spending bill passed by both the House and the Senate. President Trump then signed the bill into law. The legislation eliminates the cap on physical therapy (PT) and speech-language pathology (SLP) services, and the separate cap on occupational therapy (OT). 

The new policy requires that the KX modifier indicating services are medically necessary must be included once therapy spending reaches the $2010 level. This amount will be adjusted annually. Bills can be denied if the KX modifier is not used on claims which exceed the $2010 threshold. At the $3000 threshold, there is the potential of a targeted medical review triggered by factors such as one is a new Medicare-enrolled provider, an aberrant billing as compared to their peers, or belongs to a practice whose partners have been flagged for aberrant billing. The $3000 amount will also be adjusted annually according to the Medicare Economic Index (MEI), beginning in the year 2028.

The fix will be retroactively applied to all therapy expenses incurred starting January 1, 2018.

The budget deal also includes a pay-for that PPS did not support and worked hard to change after it was announced at the last minute. The law allows for a reduction in Medicare Part B payment for services in which a physical therapist assistant (PTA) is involved. Beginning January 1, 2022, payment for services provided by a PTA, as well as services provided by an occupational therapy assistant (OTA), would be paid at 85% of the Medicare fee schedule. This policy was not part of any of the discussions or negotiations with Congress over the past year, nor was it included as part of the proposed package of pay-fors that were announced this past fall as part of the bipartisan, bicameral agreement. PPS worked with APTA and AOTA to provide alternative proposals to eliminate, reduce, or delay the PTA and OTA payment differential, but each of these legislative options was rejected. Going forward, PPS will work with together with APTA to convince CMS and our Congressional champions to reduce the impact of this unexpected pay-for.

Questions regarding the new policy can be directed to PPS Lobbyist, Alpha Lillstrom Cheng:

For a complete summary of the therapy cap repeal and replace legislative language and policy, visit the PPS Legislative Updates Blog.


The Private Practice Section is looking for volunteers to fill 1-hour blocks of time at the PPS Booth during Combined Sections Meeting in New Orleans. Those who volunteer at the PPS booth report that it provides numerous networking opportunities that make the time well spent. We encourage you to sign up to be a PPS both volunteer and take advantage of an hour dedicated to networking with your colleagues and to sharing your enthusiasm for the Private Practice Section.

Unopposed Booth Schedule

  • Thursday February 22: 10 am - 11 am; 1:00 pm - 3:00 pm
  • Friday, February 23: 10:00 am - 11:00 am; 1:00 pm - 3:00 pm
  • Saturday February 24: 10:00 am - 11:00 am 1:00 pm - 3:00 pm

Sign-Up Now to Volunteer


Recordings from the PPS 2017 Annual Conference & Exhibition are now available for purchase in the PPS Learning Center. Individuals who prepaid for the recordings will find them loaded into their Learning Paths in the PPS Learning Center.


PPS Member Pricing


The following recordings from PPS 2017 are available in the Learning Center FREE to PPS Members:




By now, most physical therapists (PTs) have heard the news: the final 2018 Medicare Physician Fee Schedule (PFS) released in early November by the US Centers for Medicare and Medicaid Services (CMS) included some significant variations from the PFS regulations the Agency proposed in July. Instead of finalizing CPT code values that were the same as—and occasionally higherthan—current values, CMS opted to offer up a more complicated combination of cuts and increases that could affect PTs in different ways, depending on their case-mix and billing patterns.

What should PTs do in the wake of the new PFS? Here are APTA's top 4 suggestions.

1. Know the design process for the fee schedule.

It's important to understand what led to the changes to provide context, why despite our disappointment we are also experiencing a slight sense of relief, and a reminder of why payment needs to move toward value-based models and away from fee-for-service.

The PFS set to go into effect on January 1, 2018, is the CMS response to an American Medical Association (AMA) committee's recommendation on potentially "misvalued" codes associated with a wide range of professions, not just physical therapy. When the process began in early 2016, many predicted that the final outcome would be deep cuts to nearly all valuations—as much as 10% or more overall. APTA, PPS, and its members fought hard to substantiate the validity of the current valuations, and even the need for increases in some areas. The end result was a significant improvement from where things were headed at the start of the process.

That's not to say it's been an entirely satisfying process from start to finish. This recent article goes into more detail about the sometimes-frustrating journey from points A to B.

2. Understand what's being changed.

Just about everything that happens at CMS is complicated, and the process that led to the new CPT code valuations is no exception. Still, a working knowledge of how CPT codes are valued is helpful in understanding why the PFS contains such a mix of positives and negatives.

One important thing to understand is that code valuation is actually made up of 3 separate elements, known as relative value units (RVUs). These are estimations of the labor, expense, and possible professional liability involved in performing any given treatment or evaluation task associated with a CPT code. The 3 types of RVUs are known as "work,"

"practice expense" (PE), and "professional liability." The coding valuation differences between the proposed and final PFS were due to changes to the PE RVUs only.

While the AMA Relative Value Scale Update Committee Health Care Professions Advisory Committee did recommend changes to PE RVUs, CMS’s proposed rule rejected those suggestions. When the final rule was released 3 months later, CMS—without reaching out to APTA, PPS, or any other stakeholders—did an about-face and adopted the changes to PE RVUs.

What affect does this have on your practice? The answer is twofold: first, the tweaks to PE RVUs mean it's difficult to make many sweeping generalizations about how the new PFS will affect individual practices and clinics; second, it's worth noting that individual work RVUs either remained unchanged or increased. A more detailed explanation of how the codes were affected is available in an APTA fact sheet on the 2018 PFS (listed under "APTA Summaries and Fact Sheets"). For a more complete explanation of RVUs and the differences between the 3 types, check out this APTA podcast on the CPT valuation process.

3. Get a sense of how you might be affected.

A sense of history and understanding of detail are all well and good, but the bottom line is your bottom line.

Here's the complication with the 2018 PFS: because of the wide variation in upward and downward adjustments, it's hard to make statements about how PTs in general will be affected. CMS estimates the overall impact at a 1%-2% reduction, but a lot depends on the types of patients a PT or clinic typically sees and what interventions are commonly used. Some providers could see increases.

In an effort to clear up some of the uncertainty, APTA offers a calculator than can help you see how your typical case-mix would fare in the new PFS. The calculator, offered in Microsoft Excel, allows you to enter different codes to see what changes to expect, given your Medicare service area.

4. Keep learning.

There's much more to understand about the PFS—not just in terms of the details of how the new rule will work, but in terms of APTA's work to safeguard CPT codes throughout the misvalued codes review process.

One great way to learn more about what to expect is coming up in December, when the association hosts a free webinar on Medicare changes for 2018 on December 6 from 1:00 pm to 2:00 pm ET. The webinar will be presented in a "flipped" format, meaning that when you register, you'll be provided with a prerecorded presentation to listen to in advance. That way, more of the actual session can be devoted to live interaction with the presenters. Be sure to sign up—and listen up—soon.

Another opportunity is available December 13, when APTA hosts an "Insider Intel" phone-in session that will cover many of the same topics, albeit in a pared-down 30-minute session, from 2:00 pm to 2:30 pm ET. Instructions for signing up for this session are on APTA's Insider Intel webpage.


Here are a few things that can be said about the 2018 Medicare physician fee schedule (PFS) recently released by the US Centers for Medicare and Medicaid Services (CMS):

  1.  It's a mixed bag, in terms of adjustments to current procedural terminology (CPT) codes commonly used in physical therapy, with some values going up, and others being cut.

  2. Physical therapy isn't the only profession that saw CPT code reductions: otolaryngolists, nurse anesthetists, and urologists, to name a few, are also bracing for cuts.

  3. It could have been a lot worse - up to a 10% cut or more based on changes to the practice expense.

  4. Statements 1-3 aren't much consolation when you're a physical therapist (PT) facing estimated average payment reductions between 1.3% and 2% (but again, this is hard to pinpoint: there will be increases, but in other cases decreases will be even worse).

 What happened?

Just a few months ago, the outlook was good for PTs when it came to the 2018 PFS. After a 2-year American Medical Association analysis of CPT codes that CMS believed may be potentially "misvalued," the proposed rule that emerged this summer was a clear win for the profession: the proposal contained no cuts to codes values, and even a few increases. From the perspective of the profession, the proposed rule adopted all of the positive recommendations from AMA—namely, no cuts and a few increases to work relative value units (RVUs)—and none of the damaging AMA’s Health Care Professions Advisory Committee (HCPAC) recommendations, which included adjustments to practice expense (PE) inputs that would affect payment. Things were looking good, and APTA, PPS, and its members advocated strongly for the rule as proposed.

 When the final rule was issued in November, things stopped looking so bright. Between release of the proposed rule in the summer and publication of the final version, CMS veered away from its typical process when it announced—without warning and without allowing opportunity for input from any stakeholders, including APTA and PPS—that it would reverse its decision, and instead of rejecting, it would adopt the recommendations related to PE inputs. The rule change has altered the payment landscape for PTs in ways that are still being worked out by APTA. The association has published a summary of the rule on its website (listed under "APTA Summaries and Fact Sheets").

Mapping the landscape

While it's true that the final rule will result in increases in some areas, some of the payment reductions that will go into effect next year will hit home for some PTs. What is known for certain is that a few of the most commonly used codes in physical therapy will see a drop, including manual therapy, therapeutic exercise, mechanical traction therapy, and aquatic therapy.

At the same time, other codes will increase—some significantly. Gait training therapy values will increase, as will neuromuscular reeducation, and therapeutic activities. The 3-tiered evaluation codes adopted by CMS in 2016 will also rise, in addition to orthotic management and training (first encounter), and prosthetic training (first encounter).

APTA is putting final touches on a calculator that will help members get a more precise estimate of the potential impact of the new rule, given their particular practice circumstances. The calculator is set to be released early next week.

"While it's clear that the CMS reversal from its proposed rule will result in drops to some of the codes used frequently by PTs, the bottom line effects of the new rule will vary depending on case mix and billing patterns," said Carmen Elliott, MS, APTA vice president of payment and practice management. "The overall 2% drop estimated by CMS doesn't take that variation into account. There will be some providers who will see reductions in payment of anywhere from 1% to 2%, but we anticipate that others could see overall increases."

How we got here

"This is frustrating, both in terms of the payment reductions as well as the way in which CMS surprised stakeholders with its reversal from the proposed rule. The cuts will be hard on some physical therapist practices," said APTA Vice President of Government Affairs Justin Elliott (no relation to Carmen Elliott). "It’s also true that the initial projections, long before the initial proposed rule, were far more bleak."

Justin Elliott is referring to the way CMS handles codes that it believes may be "misvalued"—often read as a euphemism for "overpaid." It's a complex, multi-year process overseen by the AMA's Relative Value Scale Update Committee (known as RUC) Health Care Professions Advisory Committee (HCPAC). The RUC HCPAC engages in dialogue with stakeholder groups, including APTA, thenconducts surveys of individual providers before issuing recommendations on how codes should be valued. The survey of PTs was conducted in October 2016.

When the process began in early 2016, indications were that overall, CPT codes commonly associated with physical therapy could see a double-digit cut. APTA staff and CPT advisors worked with the RUC HCPAC to move recommendations away from that potentially catastrophic change, and survey responses from PTs helped to reinforce the notion that current code values were not far off—at least in terms of averages across all codes.

Given where things seemed to be headed in 2016, the release of the final rule, though far less than ideal, does amount to a win—of sorts. And context is important: physical therapy wasn't alone in professions with codes on the CMS chopping block, with otolaryngologists, anesthesiologists, nurse anesthetists, urologists, and vascular surgeons all seeing overall code reductions between 1% and 2%, according to CMS estimates.


What's next?

According to Justin Elliott, "APTA is exploring all avenues to advocate against these cuts before they take effect on January 1, 2018."  He added "All options are on the table and every path is being evaluated for our response to CMS’s final rule."

Those advocacy efforts will require APTA, PPS,and its members to have a solid understanding of just how the CPT changes impact them during the coming year, according to Carmen Elliott, who said that the key to getting insight on the effects is for PTs to continue to code and document appropriately while they evaluate their case mixes and other factors. "The only way to truly understand the effects of these changes is for our coding efforts to remain consistent," she said.

At the same time, APTA President Sharon Dunn, PT, PhD, thinks that there's an even bigger picture to be considered.

"We can't yet say what the overall impact will be as a result of these code value changes, and we know that the effects will vary from provider to provider," Dunn said. "What we can say for sure is that these kinds of adjustments and recalculations truly underscore the need for health care providers to move toward value-based payment models that truly reflect the value of physical therapist services triple aim—improving the experience of care, improving population health, and reducing costs. The CPT code structure has 1 foot firmly planted in the outmoded fee-for-service world. That needs to change.”

PPS President Sandra Norby, PT, DPT is looking at both the trees and the forest. 

"Each of our members will be impacted differently by this final rule; however, we need to recognize and prepare to adjust to the reality of healthcare reimbursement that is moving from fee-for-service to value-based, patient-centered payment models.  As we move forward we will continue to advocate for the profession, private practitioners, and work to prepare our membership for this transition.”