Physical Therapy Under Attack: Medicare To Make Devastating Cuts In Reimbursement

A member of our staff has developed a blog of his own to keep the public informed of how quality medical care in the United States is being threatened by a significant reduction in reimbursement rates for Medicare Part B services. With his permission, we have decided to publish his content on our blog as well.

From The Concerned Physical Therapist:

On Saturday, August 7, 2010, President Obama’s Saturday radio address touted the benefits seen in Medicare after the passing of his health care plan earlier this year. According to an Associated Press report:

“Medicare isn’t just a program,” Obama said Saturday in his weekly radio and Internet message. “It’s a commitment to America’s seniors — that after working your whole life, you’ve earned the security of quality health care you can afford.”

“As long as I am president, that’s a commitment this country is going to keep,” he said.

An annual report this week from the trustees who oversee Medicare, including the Treasury and Health and Human Services secretaries, said the program will stay afloat for a dozen years longer than previously projected, due to the sweeping health care overhaul Obama signed in March.

Was the passage of the “Obamacare” really that large a boost to Medicare? Probably not…

In their recent annual report, the Trustees of the Social Security and Medicare trust funds reported that the projections include Medicare Part B (medical insurance) reimbursement cuts “by 18-21 percent in 2015, and by up to 10 percent in 2030 and beyond”. Additionally, CMS (Centers for Medicare and Medicaid Services) is looking to further reduce a portion of therapist reimbursement if the therapist spends more time with the patient*. To put it more simply, in order to be more efficient, Medicare is simply going to pay less for services to save money.

Some people may not see a problem with this plan. Perhaps they believe that health professionals already make too much money. Some people believe that health care, overall, is overpriced and a 20% reduction in price is a good thing. And while in some instances, those thoughts may be true, they unfortunately fail to tell the whole story.

The cuts, as currently projected, go to all health professionals including physicians, nurse practitioners, physical and occupational therapists, speech language pathologists, physician assistants, chiropractors, psychologists and more. Each of these practitioners usually employ a support staff including receptionists, medical assistants, billing specialists and other support staff. Is it a reasonable expectation for practitioners to remain in business with a 20-30% reduction in reimbursement over the next 20 years, while rent will continue to climb, inflation rises and malpractice prices continue to increase? No.

Businesses will fail, directly as a result of a precipitous drop in reimbursement. One needs not be a governmental research analyst to predict the cascade of events that follows. There will be a rise in medical field unemployment/layoffs. With fewer businesses open to meet the demands of prospective patients, lines will grow longer, and it will take longer to see a clinician. Some clinicians will simply stop participating with Medicare and down size to accept only privately insured or cash pay patients.

As a consequence. there will be less choice for the Medicare patient as they have fewer offices with their doors open, and even fewer offices that participate with Medicare Part B insurance. The clinics/businesses that remain available to the Medicare patient will be swamped with too many patients to treat, and too little time. Regardless of the clinicians experience or good intentions, quality of care will most certainly suffer.

As a physical therapist, I would like to focus on a scenario: a patient who needs physical therapy services after a total knee replacement. On average, a total knee replacement surgery (with hospitalization for 3 days) costs Medicare approximately $12,000 to $13,000, assuming there are no complications. After 2 weeks in rehabilitation (costing Medicare upwards of $6,000) or receiving home-care medical services (nursing, physical therapy, occupational therapy), the patient often arrives to their initial physical therapy appointment lacking the necessary range of motion and strength to walk without a limp. Their balance is poor, and they continue to present with a significant amount of pain and swelling. Even after Medicare has spent approximately $18,000 on this patient’s care over the course of nearly 3 weeks, aggressive rehabilitation, provided by a knowledgeable physical therapist, is often required to help this patient achieve their goals.

Unfortunately, this patient may find themselves in a quandry when trying to receive physical therapy in an outpatient setting. With the projected cuts to Medicare Part B reimbursement, rural patients are likely to have to drive farther for treatment as it is likely that smaller clinics with less patient volume are already working on limited profit margins, and are going to be hit hard in the months ahead. As clinics are forced to close their doors across the nation, patients will be left with fewer choices where they intend to receive their rehabilitation.

Wherever they choose to go, the patient will likely spend less time with their therapist next year than they would have 2 years ago. With Medicare paying less for a visit overall and reimbursing the therapist less as they spend more time with the patient (reducing a portion of reimbursement by 50% for every additional 15 minutes they spent with a patient), it is foreseeable that the amount of time spent in the therapy office will likely be diminished as well. The therapist will have no choice: they either treat a greater number of patients for less time, or see fewer patients for longer periods of time while receiving less in reimbursement from Medicare. The former keeps them in business, the latter has them in the unemployment line.

What happens to the patient who just had their knee replaced? It is impossible to say. Based on clinical experience, I would say that the best case scenario would have the patient walking with a mild limp with less than functional range of motion for the rest of their lives with recurrent bouts of tendinitis in the hips/knees and/or LBP from the stresses of walking improperly while favoring the “new” knee. The worst case scenario could involve the patient stepping off a curb with a knee that never got strong enough, falling to the ground with a resultant hip fracture, followed orthopedic surgery and more rehab and physical therapy…again with poor outcomes, setting the patient up yet again for another fall, or perhaps a loss of independent living. Both scenarios involve a return to the hospital or more physical therapy with a greater cost to Medicare. No one wins from this scenario. The patient fails to get better. Medicare has greater expenses for the overall care of this patient over their lifespan. Taxpayers then need to pay more into a system that is not helping patients to begin with.

Regardless of this patient’s outcome, the system is broken. A system that dis-incentivizes a clinician and creates an environment where choice is limited for the patient is a bad system. In an effort to rescue a failing Medicare insurance system, Medicare itself is directly creating an economical climate where excellent and effective treatment is no longer available to the patients they intend to provide coverage for.

I understand that apathy is easier than interest and participation, but the time for apathy has passed and the time for action is upon us. If we do not act now, and provide a voice of opposition to the dis-incentivization of physical therapy by Medicare, by the time the consequences come to fruition, it will be too late. Please…contact Medicare and tell them that cutting benefits for physical therapy is not a solution. Tell them that cutting reimbursement indiscriminately is short-sighted and will only further burden both the patient and the medical community with unnecessarily poor outcomes and greater financial burdens that neither the patient or Medicare can afford.

*Medicare pays physical therapists per 15 minutes spent with a patient. The new regulations proposed by CMS would reduce payment by 12-13% for each 15 minutes of service provided beyond the initial 15 minutes.