CMS’ Proposed 2% Medicare Rate Cut Keeps Therapy Providers in ‘Pretty Dire’ Straits

The federal government has again proposed reductions to Medicare reimbursement for various Part B therapy services as part of its 2022 Medicare Physician Fee Schedule Proposed Rule.

And while the suggested roughly 2% in cuts are measurably lower than reductions floated this time last year, Cynthia Morton, the executive vice president for the National Association for the Support of Long-Term Care (NASL), said the picture remains “pretty dire.”

“It’s not super good news, it could’ve been worse. But it’s still pretty dire for us,” Morton told Skilled Nursing News. “A lot of our society looks to rehab therapy for a lot of things but with these continual reductions from CMS and Congress for no real reason, just trying to reduce what Medicare spends, it’s getting to the point now where it’s going to hurt access to care for beneficiaries.”


Many beneficiaries access that care in nursing facilities, which account for more Medicare Part B therapy billings than any other setting.

The Centers for Medicare & Medicaid Services (CMS) finalized its proposed physician fee schedule for the 2021 calendar year, which included 9% in cuts to Part B physical and occupational therapy rates, in December.

However, just before the end of the year Congress passed a spending bill that provided some offsets to those cuts which helped bring the number closer to 3%, Morton explained.


The bill included a $3 billion infusion of new funds into the physician fee schedule for 2021, and delayed the 2% Medicare sequestration cuts that were suspended through Dec. 31, 2020, which was approved in one of the earliest stimulus packages.

“It can’t be looked at in a silo,” Morton told Skilled Nursing News, referring to simply looking at this year’s proposed reductions when thinking about the outlook for therapy providers. “We have to look at what else, what other policies impact the same reimbursement codes.”

Additionally, as CMS continues to evaluate what should continue or become permanent follow the temporary expansion of telehealth services amid the COVID-19 pandemic, the agency announced Tuesday that it would “allow certain services added to the Medicare telehealth list to remain on the list to the end of December 31, 2023, so that there is a glide path to evaluate whether the services should be permanently added,” once the public health emergency order is no longer in place.

“That shows CMS is willing to do what they can to make some of these temporary allowances permanent,” Morton said.

New rates would take into effect on Jan, 1, 2022.

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