Outpatient Therapy Caps
What are Medicare Outpatient Therapy Caps?
Studies show that the quality of life for people with paralysis improves greatly with extensive physical therapy. However, in 1997 the Balanced Budget Act included a provision that placed payment caps on outpatient rehabilitation services under Medicare Part B. Under these caps, Medicare covers a set dollar amount for outpatient physical therapy, occupational therapy, and speech-language pathology services.
After the annual cap has been reached, beneficiaries face the decision of forgoing care, paying out-of-pocket, or traveling to an outpatient hospital for continued care. By limiting coverage for needed therapy services that exceed the payment limit to one setting only - hospital outpatient departments - the cap denies Medicare beneficiaries choice in selecting the provider best suited to meet their health care needs.
Congress has recognized the harm the therapy caps would cause and has voted several times to keep the caps from going into effect. In 2005, the Deficit Reduction Act included a one-year fix to the therapy caps by implementing an exceptions process that allowed beneficiaries to receive additional therapy over the cap limit.
Most recently, Congress voted to extend the therapy caps exception process through December 31, 2013.
Unless Congress acts, the current therapy cap exceptions process will expire on December 31, 2013. The caps that take effect on January 1, 2014 will impact beneficiary access to occupational and other skilled therapies. The Reeve Foundation will continue the important work of educating Members of Congress on the devastating impact that therapy caps would have on people living with spinal cord injury and paralysis, and will continue to urge Congress to come up with a permanent solution to the problem.