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Clarice Grote, MS, OTR/L

2024 Policy and Advocacy Updates for Occupational Therapy

2023 was a big year for passing healthcare legislation. These changes will impact occupational therapy practice in a big way, and it can be hard to keep up with them. So, here’s your TLDR for OT policy changes in 2024. 

2024 OT Advocacy Updates:

OT coverage in intensive outpatient programs for mental health

With the passing of the 2022 Omnibus Bill, Congress established a new Medicare mental health benefit known as the intensive outpatient program (IOP)

The IOP benefit mirrors the previously existing membership under Medicare for “partial hospitalization” mental health benefits. The IOP benefit can be provided by hospitals, federally qualified health centers (FQHCs) or rural health clinics. The IOP benefit is effective as of January 1, 2024.

Like the partial hospitalization benefit, occupational therapy is listed as a required service for the intensive outpatient program. Meaning, if a patient is screened and found to need OT services, then OT services must be provided.  Services are covered under the Hospital Outpatient Prospective Payment System (HOPPS)

This is an exciting opportunity to expand OT services in the community mental health setting. For additional details on this program, please read this article from AOTA.

Lymphedema Garment Coverage Under Medicare Part B

Medicare officially starts covering lymphedema and compression garments under Medicare Part B beginning on January 1, 2024. These garments will be covered under Medicare Part B under Durable Medical Equipment.

With the passing of the Lymphedema Treatment Act in 2022, Medicare Part B will now cover standard and custom-fitted lymphedema compression treatment items for each affected body part for patients with a diagnosis of lymphedema, including:

  • Gradient compression stockings, gloves, sleeves, gauntlets, garments, and wraps with adjustable straps
  • Compression bandaging supplies, liners, gauze, elastic, foam, and textiles
  • Protective absorption layers

Check out Table FF-A 2 in the CY2024 HHPPS Final Rule for a more comprehensive look at the specific covered lymphedema compression treatment items. 

Medicare Part B will pay for three daytime garments every six months and two nighttime garments every 2 years. CMS has added new HCPCS codes to bill for these specific garments that will be paid in a bundled payment using the DMEPOS Fee Schedule, which means that occupational therapy practitioners supplying these lymphedema garments will have to enroll as a DMEPOS-credentialed supplier to bill Medicare. 

Currently, the policy says that OTs cannot bill for time spent measuring for the garments as this is covered under the cost paid for the garments and instructs practitioners to negotiate payment from the DME provider for their portion of the service. However, negotiating a rate with a DME provider can certainly open up issues with anti-kickback laws so it is best to proceed with caution.  

AOTA is currently seeking continued clarification on how this affects occupational therapy, due to the concerns about duplicative billing and anti-kickback laws. AOTA has pointed out the above issues to CMS and they have yet to resolve them. So stay tuned!

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Caregiver Training Codes

This is a HUGE advocacy win! CMS rolled out new Caregiver Training codes that can be used beginning January 1, 2024. This is the very first time OT practitioners can be reimbursed for services that do not directly involve a service provided directly to the client. 

CMS outlines strict rules for how to use these codes the 2024 Medicare Physician Fee Schedule Final rule, but here are some important ones to know: 

  • Caregivers are defined as a family member, friend, or neighbor who provides unpaid assistance to a person with a chronic illness or disabling condition (i.e. you cannot bill this code if training their CNA at a SNF or ALF)
  • Skilled caregiver training is provided without the patient present (If the patient is present you bill other CPT codes as usual)

The Caregiver CPT codes are: 

97550

  • Caregiver training in strategies and techniques to facilitate the patient’s functional performance in the home or community (e.g. ADLs, IADLs, transfers, mobility, communication, swallowing, feeding, problem-solving, safety practices)
  • Face-to-face
  • Initial 30 minutes

97551

  • Each additional 15 minutes of caregiver training (bill after 38 minutes)
  • List separately in addition to code for primary service
  • Use 97551 in conjunction with 97550

97552

  • Group caregiver training in strategies and techniques to facilitate the patient’s functional performance in the home or community (e.g. ADLs, IADLs, transfers, mobility, communication, swallowing, feeding, problem-solving, safety practices)
  • Face-to-face with multiple caregivers
  • Untimed code

These codes open up a lot of opportunities. If you are considering using them, please review the webinar and directions from AOTA to ensure you are using them correctly. And of course, give a big thanks to AOTA for working so hard to develop and value these codes and then advocate for Medicare to pay for them. Now we can start advocacy for other payers to cover these codes as well. 

Payment Increase for Home Health

In a rare turn of events, CMS is increasing Medicare Part A payments to home health agencies by 0.8% in 2024, equating to $140 million. This increase comes from changes in the behavior assumption adjustment, recalibrated case-mix weights, LUPA thresholds, and comorbidity adjustments. Future reductions and cuts will happen in the coming years as CMS is required to reduce future payment models and reconcile over $3 billion in overpayments. But for now, we celebrate this year’s win 🥳

AOTA is still working on legislation to add OT as a qualifying service through the Home Health Accessibility Act. Stay tuned for updates on this piece of legislation. 

Other Home Health Changes

In addition to the payment increase, home health will also see some changes to their quality reporting program and value-based purchasing. These quality measure changes are significant because instead of using the M1800 ADL and Mobility items on the OASIS, they use Section GG items. So don’t be surprised if you receive training on Section GG this year in home health! This change is also part of the the standardization of quality measures in post-acute care as required by the IMPACT Act of 2014. 

Important changes for OT practitioners for the home health quality reporting program:

  • Adopt and publicly report the Discharge Function Score measure
  • Remove the Application of Functional Assessment/Care Plan measure
  • Remove 2 OASIS items: M0110 – Episode Timing, and M2200 – Therapy Needs
  • Begin public reporting of the Transfer of Health Information to the Provider—PAC Measure and the Transfer of Health Information to the Patient

Important changes for OT practitioners in home health value-based purchasing:

  • Replace the two Self-Care and Mobility measures with the Discharge Function Score measure
  • Replace the OASIS-based Discharge to Community measure with the claims-based Discharge to Community-Post Acute Care Measure for Home Health Agencies
  • Replace the claims-based Acute Care Hospitalization During the First 60 Days of Home Health Use and the Emergency Department Use without Hospitalization During the First 60 Days of Home Health measures with the claims-based Potentially Preventable Hospitalization measure

Payment Reduction for Medicare Part B

OT services paid for under Medicare Part B will face a 3.37% decrease compared to 2023. The finalized CMS conversion factor beginning January 1, 2024 is $32.74. With the passage of updated legislation to address the increasing cuts to the MPFS, all claims processed after March 9th will only receive a decrease of 1.42% compared to payments for the same services from the previous year. This is for all OT services paid for by Medicare B in ​​skilled nursing facilities, hospitals, outpatient clinics, and private practice settings.  This is for all OT services paid for by Medicare B in ​​skilled nursing facilities, hospitals, outpatient clinics, and private practice settings.

OT services have been facing cuts under Medicare Part B for years. For example, check out this article from 2020 (one of my very first on this site) about the 9% cut we almost experienced that year.

Permanently addressing these reductions in reimbursement is a key priority for AOTA and is a very challenging problem to fix. To learn more about this issue and what you can do, check out these two podcasts: 


Apple PodcastsAnchorBreakerCastBoxGoogle PodcastsOvercastPocketCastsRadio PublicSpotifyStitcherRSS

KX Modifier threshold 

The KX Modifier is utilized to indicate medical necessity, specifically for services over the therapy threshold. The threshold is typically updated annually so be sure to check Medicare guidelines each year. For 2024, the therapy threshold is $2,330 for occupational therapy and $2,330 for physical and speech therapy services combined. The $3,000 threshold for targeted medical review remains unchanged. 

OTA Supervision in Private Practice

General supervision of OTAs in private practice was unexpectedly extended until the end of Calendar Year (CY) 2024. Initially this extension was part of the Public Health Emergency that was supposed to end CY 2023. However, since the telehealth waiver was extended through 2024, CMS decided to go ahead and extend the supervision waiver as well. 

AOTA has proposed the EMPOWER Act to Congress that is looking into making this supervision requirement permanent rather than the direct supervision that is currently required. Without action, direct supervision requirements for private practice will be active on January 1, 2025. 

OTA Payment Differential for Aetna

Other news in 2024 for OTAs is that Aetna is delaying implementation of the OTA payment differential from December 2023 to March 2024. Beginning in March, this policy will apply a 15% reduction in payments for services provided by OTAs using the CO modifier following Medicare payment models. Read this article to learn more about the CO modifier and other payers that use the modifier or use the payment differential. 

Telehealth Coverage

The Consolidated Appropriations Act of 2023 confirmed coverage of telehealth in hospital-based outpatient clinics for therapy under the Medicare Physician Fee schedule through December 31, 2024. AOTA has proposed the Expanded Telehealth Access Act to ensure that occupational therapy practitioners are permanently approved telehealth providers under Medicare Part B.  

Merit-based Incentive Payment System (MIPS)

The Merit-based Incentive Payment System (MIPS) is a value-based care model to incentivize high quality care for OT services and others in traditional outpatient settings under Medicare part B. CMS has created the Rehabilitative Support for Musculoskeletal Care Value Pathway specifically labels occupational therapy practitioners as a specialty that can report under this new system. 

Occupational therapy practitioners can now also report on multiple new quality measures through CMS’s MIPS in 2024. 

These include: 

  • Assessment of Cognitive Impairment or Dysfunction for Patients with Parkinson’s Disease
  • Connection to Community Service Provider
  • Improvement or Maintenance of Functioning for Individuals with a Mental and/or Substance Use Disorder
  • Gains in Patient Activation Measure (PAM®) Scores at 12 Months

Another change under MIPS for 2024 is that occupational therapy practitioners will now have to report on the Promoting Interoperability Category, when we used to be previously exempt. This means that any private practice settings that report to MIPS will be required to have certified electronic health records for at least six months of 2024. This could be a significant cost for many practices. Most practitioners are not required to participate in MIPS, but if you have a large Medicare Part B caseload, be sure to check if you are supposed to be reporting to MIPS. 

Check out this article from AOTA to learn more about these MIPS changes. 

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How do I stay up to date with the upcoming changes? 

There are big policy proposals to be voted on in 2024, including OTA supervision and payment, telehealth, and the Medicare Physician Fee Schedule. With 2024 being an election year, I am positive there will be no shortage of surprises. To support ongoing advocacy efforts make sure to be an AOTA member and use their free take action page to contact your legislators!

Stay in the know with the Amplify OT Membership, where you’ll be the first to know the policy changes coming that impact your practice. 

Become an OT Amplifier! you should feel good about what you do. Emerge a confident clinician who knows their value. Join the Amplify OT Membership Today. Image shows 5 screens with previews of the Amplify OT membership courses and groups.

Resources

Special thanks to Lindsay Bright, OTD, OTR/L for her contribution to this article. 

Clarice standing in a light room smiling wearing black pants and a light green puff sleeve shirt

hi there,

I’m  Clarice

Occupational therapist & medicare specialist helping practitioners understand policy, engage in advocacy, and own their value!

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