Speech therapy, occupational therapy, physical therapy, and pediatric therapy facilities bill Medicare for the services that outpatients receive. These billing charges and claims involve the use of time-based Current Procedural Terminology (CPT) codes known as the Medicare 8 minute rule. This was first introduced in December 1999 and became effective on April 1, 2000.
A billable “unit” of timed service refers to the time duration of the service. The 8-minute rule determines how many units can be billed for the timed services delivered in:
- Rehabilitation facilities
- Skilled nursing facilities
- Home health agencies providing therapy covered under Part B
- Hospital outpatient departments, including emergency
- Some private practices
The Medicare 8 minute rule allows these providers to bill Medicare for one “unit” of timed service when the length of service lasts at least eight minutes and less than 22 minutes in order to determine how many units of 15-minutes of service were provided. This is because not all outpatient treatments can be carefully divided into 15-minute increments.
Who Qualifies for Time-Based Services?
To qualify for reimbursement for a time-based treatment code, a therapy session must include one-to-one or continued application of the therapy for at least 8 minutes. That means that the skilled therapist cannot also document care or attend to another resident in that same time interval. Rather, the therapist must be actively engaged with the resident and not passively supervise while he or she completes the exercises, activities, or service on their own.
Of course, one session can be billed as more than one unit. Here’s how that works: when Medicare evaluates a claim, the total of all timed service minutes is divided by 15. If the result of the equation leaves at least eight minutes remaining before reaching another 15-minute increment, one can bill for the next unit. If there are fewer than eight minutes remaining, one cannot bill for another unit.
Physical Therapy and Medicare Timed-base Units and Service-based United
The 8 minute rule is based on total timed minutes per discipline for the same day. And that makes sense, as it seems to cover all the relevant treatment sessions in a day. But what if an individual service takes less than eight minutes? Then the question becomes, was it a time-based unit or a service-based unit? Let’s look at the difference:
Time-Based Units: As explained earlier, each unit is between eight and 22 minutes long. So if 23 to 37 minutes are spent on the timed services, Medicare can be billed for two units total. If the services take 38 to 52 minutes, the provider can charge for three units. And this format continues in the 15-minute intervals of units up to 127 minutes of eight units (see chart provided by Medicare).
Common Timed Based CPT Codes include:
- Manual electrical stimulation (97032)
- Manual therapy (97140)
- Therapeutic exercises (97110)
- Ultrasound (97035)
The following chart shows how units can be calculated:
|Appointment length||Number of billable units|
|8 to 22 minutes||1 unit|
|23 to 37 minutes||2 units|
|38 to 52 minutes||3 units|
|53 to 67 minutes||4 units|
|68 to 82 minutes||5 units|
|83 to 97 minutes||6 units|
|98 to 112minutes||7 units|
|113 to 127 minutes||8 units|
Service-Based Units: Despite the amount of time it takes to complete these activities, the therapist can only bill for one unit per visit on the same day, regardless of how long the session lasts. This is why these codes are generally referred to as visit-based units. In physical therapy, such sessions could involve:
- An evaluation
- Electrical stimulation (unattended)
- Applying hot or cold packs
8 Minute Rule Medicare and Tips for Maximizing Reimbursements
While it is true that only treatments that last eight to 22 minutes count as a billable unit, there are certain subtleties to the application of the 8 minute rule that all caregivers should keep in mind. These three tips will ensure that your organization is being reimbursed for all of the services that it provides:
1. Combine Mixed Remainders
If a treatment lasts less than eight minutes, the remaining leftover minutes can still be billed under the 8 minute rule by combining mixed remainders. Let’s look at some examples:
Example #1: Therapeutic exercise lasts 20 minutes, leaving five (unbillable) minutes. And manual therapy lasts 18 minutes, leaving three (unbillable) minutes. You can take that 38-minute total, and divide it by 15 to get two billable units along with a remainder of 8 (minutes). Under the Medicare 8 minute rule, the 8 represents an additional billable unit. And that extra unit can be billed as a second unit of the longer service (therapeutic exercise that lasted 20 minutes). So we end up with three total billable units for these two services.
Example #2: A resident in a skilled nursing facility for speech pathology recovering from an ischemic stroke. A speech therapist performed a cognitive performance test (96125) for 55 minutes as well as 35 minutes of therapeutic intervention of cognitive function (97129). On this single day, the therapist spent a total of 90 minutes with the resident, creating six billable units:
- 3 units of 96125, with 10 (unbillable) minutes remaining
- 2 units of 97129, with 5 (unbillable) minutes remaining
When you add up the remainders (5+10) you get 15, which is greater than 8 and less than 22 minutes, meeting the standard for billing under the Medicare 8 minute rule. This additional unit can be billed as a cognitive performance test (96125). You now end up with six total billable units instead of five.
2. Include Assessments, Management, and Education Time
It is worth knowing that CPT rules allow providers to also bill for the time involved with managing, educating, and assessing a resident about their current condition defined by each code. Providers like rehabilitation therapists can lose billable services by neglecting to bill for these CPT codes and include the functions on the claim.
3. Bill for Time Spent on Documentation
When documenting is done in the presence of the patient, it can be billed. If documenting is done later and not in the presence of the patient or resident, then this is not a billable service.
So if physical therapy discussed intervention outcomes with the patient and then also proceeded to document during this visit while in the presence of the patient—without leaving to address another patient—then, according to Medicare CPT code rules, this action is a billable labor.
The Importance of Understanding the Medicare 8 Minute Rule
Understanding the Medicare 8 minute rule helps prevent coding errors and thus reduce denials. Caregivers can better understand how to bill by first listing out and distinguishing between service-based units and time-based units. Knowledge of the differences between service-based units and time-based units will reduce denials and optimize claims reimbursement.
While, based on this rule, billable units must last between eight and 22 minutes, there are ways to still account for services that may not be as clear-cut. For instance, documentation conducted in the presence of patients is billable. And qualifying remainders can be combined to make for another billable unit to be billed. These measures help improve reimbursement. Of course, before billing private insurance, check to see if the company accepts mixed remainders.