Outpatient Therapy Services Billed with KX Modifier Targeted Probe And Educate Review Results

The Jurisdiction F, Part A Medical Review Department is conducting a Targeted Probe and Educate (TPE) review of for outpatient therapy revenue codes 042, 043, and 044 billed with modifier KX. The findings of claims reviewed from January 1, 2024 through March 31, 2024 are as follows:

Top Denial Reasons

  • Documentation did not support documentation requirements for therapy services.
  • Documentation did not support medical necessity.

Educational Resources

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Documentation Requirements for Therapy Services

For Medicare benefits to be paid, there must be sufficient documentation to verify the services were performed and also at the level of care that was required. If there is no documentation or insufficient documentation, then there is no justification for the services or the level of care billed. Services that are denied based on no documentation are reflected as billing errors.

For additional information, reference the Internet Only Manual (IOM), Publication 100-02, Medicare Benefit Policy Manual (MBPM), Chapter 15, Section 220.3(E).

Certification/Recertification/Plan of Care Requirements

The certification requires a qualified physician or nonphysician practitioner (NPP) signature and date on the plan of care or some other document to indicate approval of the plan of care. A plan of care outlines the treatment plan after an evaluation of a patient’s condition and is considered established when it is developed, e.g., written or dictated. The signature and professional credentials of the person who established the plan and the date must be supported in the documentation. The plan of care may only be developed by a practitioner or a licensed therapist specific to their specialty, e.g., a physical therapist would complete a plan of care specific for physical therapy services. At a minimum, the plan of care must include the following:

  • Diagnosis
  • Long term treatment goals
  • Type, amount, frequency, and duration of therapy services
  • Frequency of therapy refers to "the number of times in a week the type of treatment is provided" which can be tapered as necessary. Long term treatment goals should be measurable and related to the patient’s impairments.

Certification requirements are met when the practitioner certifies the minimum required plan of care elements with a legible dated signature on the plan of care or some other document that indicates approval of the plan of care. If the order contains all the required elements of the plan of care and is legibly dated and signed by the practitioner, then no further certification is required.

Timeliness is met when the initial certification is signed within 30 days of the initial treatment under that plan. Recertification of the minimum required plan of care elements must be legibly signed and dated by the practitioner during the duration of the prior plan of care or within 90 days, whichever is less. For example, if frequency and duration on the prior certified plan of care is documented as 2 times a week for 4 weeks, then that certification is valid for 4 weeks and the recertification must be completed by the practitioner within that 4-week time frame to meet the timeliness standard.
Delayed certification/recertification is acceptable without justification for an additional 30-day grace period after they are due. If the plan of care has not been legibly signed and dated within 60 days, the practitioner must also provide a rationale for the delay.

For additional information, reference Internet Only Manual (IOM), Publication 100-02, Medicare Benefit Policy Manual (MBPM), Chapter 15, Sections 220(A), 220.1.2 – 220.1.3.

Maintenance Therapy

To support the medical necessity of skilled maintenance therapy, documentation must clearly support that the specialized judgement, knowledge, and skills of a qualified therapist are necessary to both safely and effectively provide the maintenance therapy services. Services are not considered skilled solely because the service was provided by a therapist or therapist assistant. Unskilled and/or non-complex services are not covered, because they neither involve complex and sophisticated therapy procedures nor require the judgement and skills of a qualified therapist for safety and effectiveness.

When the patient requires ongoing skilled maintenance therapy documentation must clearly indicate how/why the skills of therapist continue to be needed to support continued medical necessity. Note that the KX modifier should not be applied for services that do not meet Medicare's medical necessity standard. Unskilled maintenance therapy is not covered by Medicare.

For additional information, reference Internet Only Manual (IOM), Publication 100-02, Medicare Benefit Policy Manual (MBPM), Chapter 15, Section 220.2(A)(D).

Medical Necessity

To support medical necessity of therapy services, documentation must clearly support that the skills of a therapist were required.

Skilled care includes:

  • Individualized services rendered for treatment of a medical condition that require the skills and knowledge of a therapist
  • Services that meet acceptable standards of medical practice to effectively treat the patient’s condition
  • Services that are complex and sophisticated such that they require the judgement and skills of a qualified therapist for safe and effective completion
  • Rehabilitation services must be provided at a reasonable duration as evidenced by the patient continuing to significantly and objectively benefit from ongoing skilled therapy

The Internet Only Manual (IOM), Publication 100-02, Medicare Benefit Policy Manual (MBPM), Chapter 15, Section 220.3(D) describes requirements for rehabilitative and skilled maintenance therapy.

The KX modifier should not be applied for services that do not meet Medicare's medical necessity standard. Unskilled maintenance therapy is not covered by Medicare.

For additional information, reference: Noridian Coverage Article, Medical Necessity of Therapy Services A52775, IOM, Publication 100-02, MBPM, Chapter 15, Section 220-230.

Treatment Encounter Note Documentation

A treatment encounter note is required to include two time elements: the total time-based treatment minutes and the total treatment minutes. The total treatment minutes includes both time spent providing time based and untimed code services. The total treatment minutes do not include time for services that are not billed. For Medicare purposes it is not required that the unbilled services that are not part of the total treatment minutes be recorded, although they may be included voluntarily to provide an accurate description of the treatment. The specific amount of time for each intervention and/or procedure provided may also be recorded, but it is not required.

Additionally, the number of minutes spent on non-covered versus covered services should be clearly differentiated for each treatment encounter note to support accurate coding and billing.

Treatment encounter notes must include:

  • Date of treatment
  • Identification of each specific intervention/modality to support billing
  • Legible signatures with professional credential of qualified staff
  • Total treatment minutes for the session, including minutes for timed and untimed code services

Total treatment minutes for the session do not include time for services that are not billable (e.g., rest periods, independent gym activities, patient changing clothing, waiting for/set-up of equipment).

The following are examples to help clarify appropriate documentation requirements:

  • Example 1: A patient is seen and treated for 50 minutes. Services completed included therapeutic exercises for 40 minutes and a cold pack for 10 minutes. The total treatment time should be documented as 50 minutes and the total timed code treatment should be documented as 40 minutes supporting the billing for 3 units for Current Procedural Terminology (CPT®) code 97110.
  • Example 2: A patient is seen and treated for 45 minutes. Services completed include an evaluation for 30 minutes and therapeutic exercises for 15 minutes. The total treatment time should be documented as 45 minutes and the total timed code treatment should be documented as 15 minutes, which would support billing of CPT® 97162 for 1 unit and CPT® 97110-1 unit.
  • Example 3: A patient is seen and treated for 40 minutes. Services completed included therapeutic exercises for 22 minutes, manual therapy for 8 minutes and ultrasound for 10 minutes. The total treatment time should be documented as 40 minutes and the total timed code treatment should be documented as 40 minutes, which would support billing of CPT® 97110-1 unit and 97035-1 unit and 97140-1 unit.

For additional information, reference the Internet Only Manual (IOM), Publication 100-02, Medicare Benefit Policy Manual (MBPM), Chapter 15, Section 220.3(E).

Last Updated Apr 15 , 2024