Intensive Outpatient Program (IOP) - JE Part A

An Intensive Outpatient Program (IOP) is a distinct organized outpatient program of psychiatric services provided for individuals who have acute mental illness that includes, but not limited to:

• Depression,
• Schizophrenia
• Substance Use Disorder (SUD)

It consists of a specified group of behavioral health services paid on a per diem basis under the OPPS or other applicable payment system. The program also works for patients requiring more than outpatient services, but circumstances do not favor hospitalizations. They are furnished by:

• Hospital outpatient department (HOPD)
• Critical Access Hospitals (CAHs)
• Community Mental Health Centers (CMHCs)
• Rural Health Clinics (RHCs)
• Federally Qualified Health Centers (FQHCs)
• Opioid Treatment Programs (OTPs).

Effective January 1, 2024, across all these settings, IOP services are available for both individuals with mental health conditions and individuals with substance use disorders.

IOP is similar to partial hospitalization programs (PHP) but differs in the number of hours spent with the therapist. Both programs offer intensive care, but the patient does not sleep at the facility.  PHP requires 20 or more hours of participatory sessions per week, while IOP provides behavioral services for 9 to 19 hours a week.

IOP requires clients to receive at least three hours of therapy three to four days a week.

Payment for IOPs

Beginning with services provided on or after January 1, 2024, the A/B MAC (A) makes payment for hospital outpatient departments under the hospital outpatient system for IOP services. The Part B deductible and coinsurance apply.

For CAHs, payment is made on 101% reasonable cost basis.

Payment for non-excepted off-campus, hospital-based IOPs will be made under MPFS, paying CMHC per diem rate for APC 5851, for providing up to three IOP services per day and APC 5852, for providing four or more IOP services per day.

The Part B deductible, if any, and coinsurance apply.

Starting in CY 2024 and subsequent years, the payment structure for IOP services provided in hospital outpatient departments and CMHCs has been set to four separate APCs:

Hospital-based and CMHC IOP APCs

Type of Bills (TOBs) for institutional billing

Hospital Outpatient Department, CAHs, and CMHCs bill the following TOBs:

• Outpatient hospital Part B: TOB 13X
• CAH: TOB 85X
• CMHC: 76X

Sequential Billing

IOP claims must be submitted in sequence for a continuing course of treatment.

IOP Coding

IOP services are identified using condition code (CC) 92 on claims. For Hospitals and CAHs report CC 92 in FLs 18-28 to indicate claim is for IOP services. They must also report a revenue code and charge for each individual covered service furnished. In addition, hospital OPDs are required to report HCPCS codes, CAHs are not.

IOP services paid with the OPPS payment methodology are identified as OPPS hospitals on TOB 13X with CC 92 or CMHCs on a bill type 076X with CC 92.

When a hospital provides non-IOP mental health services to an IOP patient, all IOP and non-IOP mental health services should be reported on the same hospital claim with CC 92.

IOP claims with CC 92 and a separate PHP claim with or without CC 41 for overlapping periods of time (within seven days of each other) will return to provider *RTP) with reason code 98363.

Modifier Reporting

Modifier PN: IOP services, non-excepted off-campus provider-based departments of a hospital are required to report a "PN" modifier on each claim line for non-excepted items or services. This will trigger a payment rate under Medicare Physician Fee Schedule. CMS expects PN modifier to be reported with each non-excepted item and service including those for which payment will not be adjusted, such as separately payable drugs, clinical laboratory tests, and therapy services.

Modifier PO: IOP services provided in excepted off-campus provider-based departments of a hospital must continue to report existing modifier "PO" (services, procedures and surgeries provided at off-campus provider-based outpatient departments) for all excepted items and services furnished.

Reporting of Service Units

Hospitals report the number of times the service or procedure, as defined by HCPCS code, was performed.

CAHs report the number of times the revenue code visit was performed.

When reporting service units for HCPCS or CPT codes where the definition of the procedure does not include any reference to the time (minutes, hours, or days), hospital outpatient departments do not bill for sessions less than 45 minutes.

*Service units are not reported for drugs and biologicals (Revenue code 0250)

Hospitals must retain documentation to support the medical necessity of each service provided, including beginning, and ending time.

Hospital Example:

A beneficiary received psychological testing (HCPCS or CPT code 96100, defined in one-hour intervals) for a total of 3 hours for one day. The hospital reports revenue code 0905 in FL 42, HCPCS or CPT 96100 in FL 44 and three units in FL 46. CAHs would report revenue code 0918 and leave HCPCS or CPT blank and report one unit in FL 46.

CMHCs, in the "service units" field, report the number of times the service or procedure was performed when billing for IOP services identified by the revenue code.

CMHC Example:

A beneficiary received psychological testing performed by physician for total of three hours for one day (HCPCS or CPT code 96130, first hour; HCPCS or CPT code 96131 for two additional hours). The CMHC reports revenue code 0905, HCPCS or CPT code 96130, and one unit; and a second line on claim showing revenue code 0905, HCPCS or CPT code 96131 and two units. When reporting service units for HCPCS or CPT codes where the definition of the procedure does not include any reference to time. CMHCs should not bill for sessions less than 45 minutes.

Line-Item Date of Service (DOS) Reporting

Hospitals other than CAHs are required to report line-item DOS per revenue code line for IOP claims. Each service (revenue code) provided must be repeated on a separate line item along with the specific date the service was provided for every occurrence. Line-item DOS are reported in FL 45 "service date".

For claims, report as follows:

Revenue Codes

HCPCS and CPT Coding

Hospitals and CMHCs are required to report appropriate HCPCS and CPT codes.

*G0129 - OT services requiring skills of a qualified occupational therapist, furnished as a component of a partial hospitalization or IOP, per session (45 minutes or more). *Only used for IOP or PHP

**90791 - Diagnostic evaluation (no medical services) completed by a physician.

***G0176 - Activity therapy, such as music, dance, art or play therapies not for recreation, related to the care and treatment of patient’s disabling mental problems, per session (45 minutes or more). *Only used for IOP or PHP

****G0177 - Educational services related to the care and treatment of patient’s disabling mental health problems, per session (45 minutes or more). *Only used in IOPs, PHPs, and outpatient mental health settings.

Scope of Benefits

• Items and services available under IOP benefit include:
• Individual and group therapy with physicians or psychologists, or other mental health professionals authorized by state in which they practice (e.g., licensed clinical social workers, mental health counselors, marriage and family therapists, clinical nurse specialists, certified alcohol and drug counselors);
• OT with qualified OT therapist, or qualified occupational therapy assistant (OTA);
• Services of social workers, psychiatric nurses, and other trained staff; including peer support specialists;
• Drugs and biologicals furnished for therapeutic purposes, not self-administered;
• Individualized activity therapies that are not primarily recreational or diversionary;
• Family counseling services for which primary purpose is the treatment of the patient’s condition. These include counseling services for caregivers;
• Patient training and education, to the extent the training and educational activities are closely and clearly related to the individual’s care and treatment of his/her diagnosed psychiatric condition;
• Medically necessary diagnostic services related to mental health treatment (including SUD).

Non-covered Services

• Meals and transportation
• Activity therapies, group therapies, or services that are recreational or diversional in nature.
• Psychosocial programs
• Vocational training

Documentation Requirements

Initial Psychiatric Evaluation and Certification

• Upon admission, certification by physician must be made that patient admitted to IOP requires a minimum of nine hours per week.
• Must be furnished under individualized written plan of care, established by physician that includes:
• Active treatment provided through combination of structured, intensive services that are not reasonable and necessary to treat presentation of serious psychiatric symptoms and prevent relapse.

Recertifications

Must be signed by physician who is treating patient and has knowledge of patient’s response to treatment.

At intervals established by provider, but no less than every 60 days following IOP certification.

Must specify patient requires a minimum of nine hours per week describing:

• Patient’s response to therapeutic interventions
• Patient’s psychiatric symptoms
• Treatment goals for coordination of services to facilitate discharge.

Treatment Plan

• Identifies treatment goals
• Prescribed and signed by physician
• Coordination of services
• Structured to meet needs of patient
• Includes multidisciplinary team approach to patient care
• Address presenting symptoms
• Goals should measure patient’s response to treatment
• Ongoing efforts to restore individual to higher level of functioning

List A Primary Services

IOP codes and List A and B services list

Resources

• CMS Change Request (CR) 13496
• CMS Medicare Learning Network (MLN) Matters (MM) 13222 - New Condition Code 92: Billing Requirements for Intensive Outpatient Program Services
• CMS Internet Only Manual (IOM), Publication 100-04 Medicare Claims Processing Manual, Chapter 4, Section 261
• CMS IOM, Publication 100-02, Medicare Benefit Policy Manual, Chapter 7, Section 40.1.2.15
• CMS IOM, Publication 100-02, Medicare Benefit Policy Manual, Chapter 6, Section 70
• CMS IOM, Publication 100-02, Medicare Benefit Policy Manual, Chapter 15, Section 60 and 220
• CY 2024 Medicare Hospital Outpatient Prospective Payment System and Ambulatory Surgical Center Payment System Final Rule
• Opioid Treatment Programs (OTP)
• Important New Changes to Improve Access to Behavioral Health in Medicare