CMS Finalizes Proposed Cuts to Medicare Part B Therapy Services for 2021, Expands Telehealth Coverage

The federal government on Tuesday finalized its proposed physician fee schedule for the 2021 calendar year, formalizing cuts to Medicare reimbursement rates for therapy services provided to residents covered under Part B — while also expanding some telehealth flexibilities offered during COVID-19.

The Centers for Medicare & Medicaid Services (CMS) in August floated a 9% cut to Part B physical and occupational therapy rates; the finalized Physician Fee Schedule (PFS) announced Tuesday appears to keep those same cuts intact, National Association for the Support of Long-Term Care executive vice president Cynthia Morton told SNN via e-mail.

“It’s shocking … cutting nursing facilities’ services during a pandemic when the most vulnerable to COVID are being treated in nursing facilities,” Morton wrote to SNN.


Medicare Part B covers so-called “dual-eligible” nursing home residents, or those who qualify for both Medicare and Medicaid.

“Of all the settings that bill Part B therapy, nursing facilities bill the most,” Morton told SNN back in August.

The reduction in therapy payments was proposed to keep the PFS revenue-neutral, offsetting increases in reimbursements for primary care physicians.


CMS on Tuesday also moved to extend Medicare coverage of telehealth services allowed on an emergency basis during the COVID-19 crisis past the end of the formal public health emergency (PHE).

“These additions allow beneficiaries in rural areas who are in a medical facility (like a nursing home) to continue to have access to telehealth services such as certain types of emergency department visits, therapy services, and critical care services,” CMS noted in a statement.

The federal government broke down nearly all remaining barriers to providing virtual health interventions in nursing facilities early during the COVID-19 crisis, though the agency noted that it does not have the authority to permanently expand nursing home telehealth outside of rural areas.

CMS will commission a study of the temporary telehealth steps taken during the pandemic.

“The study will explore new opportunities for services where telehealth and virtual care supervision, and remote monitoring can be used to more efficiently bring care to patients and to enhance program integrity, whether they are being treated in the hospital or at home,” CMS noted.

Various voices in long-term health care, including CMS administrator Seema Verma, have predicted that the COVID-19 crisis will accelerate the growth of telehealth in Medicare and the health care landscape more broadly, as beneficiaries see the benefits of virtual visits allowed under temporary waivers.

“The pandemic accentuated just how transformative it could be, and several months in, it’s clear that the healthcare system has adapted seamlessly to a historic telehealth expansion that inaugurates a new era in healthcare delivery,” Verma said in a statement.

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