Long-Term Care Industry Updates

With the New Year upon us, HW&Co. would like to wish you a happy, healthy and prosperous New Year. As always, the New Year brings many changes to the Long-Term Care Industry. We are pleased to provide you with Long-Term Care Industry updates on some of these changes.

In this issue:

  1. 2021 Part B Fee Schedules
  2. Therapy Caps Update
  3. Multiple Procedure Payment Reduction Remains in Effect
  4. Make Sure your PS&R System Login is Active!
  5. 2021 Medicare Part A Coinsurance & Medicare Part B Deductible
  6. Important – Updated CMS Medicare Bad Debt Requirements
  7. January 1, 2021 Ohio SNF Medicaid Rates
  8. Medicaid Benchmarking Reports Now Available


Guidance on the federal and state COVID provider relief funds has been ever changing and often conflicting. HHS’s FAQs continue to be updated frequently.    HW&Co. is here to assist you in any way we can. Please visit the HW&Co. COVID-19 resource center on our website for additional resources or contact your HW Healthcare Advisor if you need assistance.


2021 Part B Fee Schedules

The Medicare Part B Physician Fee Schedule Final rule was released by the Centers for Medicare & Medicaid Services (CMS) on December 1, 2020.  As expected based on last year’s final rule and the 2021 proposed rule, and despite significant lobbying, the fee schedule payments for many specialty services, including therapy, were reduced upwards of 10% in order to pay for increased evaluation and management services provided by primary care physicians.

However, the stimulus bill signed in late December, “The Consolidated Appropriations Act, 2021,” reversed the policy change in the final rule and including additional funding for Physician Fee Schedules payments “to support physicians and other professionals in adjusting to changes in payment for physicians’ services during 2021.”  The final conversion factor, the main underlying component of the fee schedule payment calculation, is $34.89, which is lower than last year’s conversion factor but considerably higher than the 2021 final rule.  As with every year, the payment rates for individual HCPCS coded may vary from the stated percentage change due to changes in the other underlying components of the payment calculation.

The Therapy fee schedules provided below are effective from January 1, 2021 through December 31, 2021.  It is important to forward the fee schedules to your business office personnel to use for January bills. Our Revenue Cycle Consultants are available to assist with any billing questions you may have. In addition, if you use PointClickCare, the Part B fee schedules are automatically updated in your system.

2021 Ohio Therapy Medicare Part B Fee Schedule

Many of the fee schedules change or are updated on a quarterly basis. Please review the appropriate schedule based on the Centers for Medicare & Medicaid Services (CMS) updates. Check the CMS website on a regular basis for updates to these schedules. Please note that these schedules are not all inclusive. We have attempted to limit this information to the most commonly used Healthcare Common Procedure Coding System (HCPCS) codes for long-term care facilities.

Fee schedules for lab, radiology, PEN and DMEPOS services are also available.  These fee schedules may be helpful in negotiating contracts with your ancillary service providers.  Please contact your HW Healthcare Advisor if you would like a copy of one of these fee schedules for 2021 services.

Part B Services Provided by Therapy Assistants

As finalized in last year in the 2020 Physician Fee Schedule Final Rule and as required by federal law, CMS requires billing modifiers for services provided by physical and occupational therapy assistants.  Effective January 1, 2020, the CO and CQ modifiers must be included when a therapy assistant provides all of the service billed under a given code.  If a therapist is involved throughout the entire service, no modifier is required.  At this time, the modifiers will not impact Part B reimbursement.  However, beginning in 2022, Part B reimbursement for services provided by therapy assistants, as indicated by the modifiers, will be reduced by 15%.

 Therapy Caps Update

The therapy caps for Part B therapy services were eliminated in the Bipartisan Budget Act of 2018.  However, the KX modifier must still be used when services over the limits are provided as a provider attestation of medical necessity.  The limits for 2021 are $2,110 for physical and speech therapy (combined) and occupational therapy.  The budget act also lowered the threshold for targeted medical reviews of therapy claims from $3,700 to $3,000, which will be in effect through calendar year 2028.

 Multiple Procedure Payment Reduction Remains in Effect
The Multiple Procedure Payment Reduction (MPPR) remains in effect for 2021. The MPR cuts the practice component of the fee schedule payment for certain HCPCS codes by 50% when more than one kind of therapy is provided to a resident in a single day.

For 2020, the MPPR covers therapy services billed under 51 different HCPCS.  The last column of the therapy fee schedules provided above shows the payment that would be made under the MPPR for the affected therapy codes.

Make Sure your PS&R System Login is Active!

Just a quick reminder that passwords for the CMS PS&R system expire every 60 days and must be changed.  In addition, to avoid being locked out, the PS&R system must be accessed at least once every six months.  We recommend you address any password or log in issues now to avoid delays in accessing your PS&R reports for the Medicare cost reports due in May.

Please contact your HW Healthcare Advisor if you have any questions on accessing the PS&R system.

2021 Medicare Part A Coinsurance & Medicare Part B Deductible

Effective January 1, 2021, the Medicare Part A coinsurance rate for SNFs will increase to $185.50 per day from $176.00 for days 21 through 100. The Part B deductible will be $203.00 for 2021, up $5 from 2020.

Important – Updated CMS Medicare Bad Debt Requirements

As a reminder, last year, CMS clarified its Medicare coinsurance bad debt policy.  Effective for cost reporting periods beginning on or after October 1, 2019 (i.e., 2020 cost reports for calendar year providers), providers must write off unpaid coinsurance amounts for Medicare-Medicaid (dual eligible) crossover claims to a bad debt expense account in their general ledgers.  The dual eligible coinsurance amounts can no longer be written off to a contractual allowance account.  CMS indicated this was a long-standing requirement in the Provider Reimbursement Manual.

While the overall reimbursement for dual eligible coinsurance bad debts remains at 65%, providers may need to adjust how amounts are written off in their general ledgers to ensure continued reimbursement of coinsurance bad debts.



January 1, 2021 Ohio SNF Medicaid Rates

The Ohio Department of Medicaid posted updated rate letters to providers’ MITS portals in early January for new rates effective January 1, 2021.  For most providers, the only change was an update to the direct care price for the average of June and September 2020 case mix scores.  We recommend you review them closely to ensure the rates are being calculated correctly.  Should you believe ODM has made an error, you must file a request for rate reconsideration within 30 days of the date of the rate letter.

Medicaid Benchmarking Reports Now Available

The 2019 Medicaid Nursing Facility (NF) Cost Report database from ODM and the ICF-IID cost report database from DODD allow us to analyze annual cost, census, and staffing trends.  We can compare your facility’s expenses, census and staffing against selected competitors, as well as county, peer group and statewide averages.  These reports provide valuable information to assist you in optimizing the operations of your facility.  Please contact us if you are interested in a benchmarking report.

Steve Anderson CPA