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Changes to Medicare’s “Incident To” Regulations Impact Physician Reimbursement

For physicians and other licensed practitioners utilizing “incident to” billing for occupational or physical therapy services under Medicare, new federal regulations may impact current and future staffing decisions. Providers should ensure that the person providing those “incident to” services qualifies for Medicare reimbursement under the applicable federal regulations.

As of July 25, 2005, for therapy services to be reimbursed by Medicare, the therapy must be delivered by either a physician or by someone that qualifies as a “therapist” under the federal regulations. Generally, 42 CFR § 484.4 requires that the physical or occupational therapy provider have graduated from physical or occupational therapy program respectively. 1 Therefore, despite extensive training in occupational and physical therapy, chiropractors will be unable to provide “incident to” therapy services and be reimbursed by Medicare, unless the chiropractor meets the specific criteria set forth in the Code of Federal Regulations. The new regulations will affect joint ventures between physicians and chiropractors where chiropractors provide certain therapy services “incident to” services provided by the physician, but are not qualified as a “therapist” under the regulations.

Likewise, physical or occupational therapy services provided “incident to” the services of a chiropractor under the Medicare Chiropractic Demonstration Project 2 will not be reimbursed unless the person who furnishes the service is a “qualified practitioner” under the regulations. Strangely, although a “qualified practitioner” under federal regulations is defined as an individual who has graduated from a physical or occupational therapy program or has equivalent educational credentials, as outlined in 42 CFR §484.4, there is no requirement that the therapist actually hold a license under applicable state law.

The American Chiropractic Association (ACA) has been strenuously lobbying the Centers for Medicare and Medicaid Services of the Department of Health and Human Services (CMS) to recognize that chiropractors receive extensive education and training in physical therapy and currently provide such services to patients under most state laws. To this point the ACA has been unsuccessful in having CMS revisit the regulations.

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This article is presented for educational and informational purposes only and is not intended to constitute legal advice.

About the Author

Deepak (“D.J.”) Jeyaram is the founder of Jeyaram & Associates, a full service health law firm. He represents a wide variety of healthcare providers including hospitals, nursing homes and physician group practices. He concentrates his practice in healthcare regulatory matters, primarily in administrative appeals and Medicare and Medicaid reimbursement.

His prior experience includes working in-house with Georgia Medicaid, rising to the position of Deputy Director of Legal Services. Later in his career, Jeyaram was an Administrative Law Judge who presided over disputes between the Georgia Department of Community Health and Medicaid providers on issues involving reimbursement, utilization review and provider termination. Jeyaram received his bachelor’s degree, cum laude, from Boston University and his law degree from Emory University.

1 There are exceptions for experienced physical therapists who have not graduated from a program but have the requisite experience and have passed a proficiency exam given by the U.S. Public Health Service and for therapists who were licensed prior to 1966 and have accrued 15 years of experience full-time physical therapy experience prior to 1970 under the direction of a M.D. or D.O.

2 The Chiropractic Demonstration Project is currently unavailable in Georgia.