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The Outpatient Therapy Documentation/Claims Conundrum – Will the OIG be looking at you?

By Lynn Berry, PT, CPC
February 08, 2012

Background information:

In November, 2011 the OIG published their 2012 Work Plan. While the plan covers a whole array of services, one of the areas up for investigation again this year is outpatient physical therapy services in the independent therapy setting. The parameters of their review can be found under Fiscal Year 2012 HHS OIG Work Plan, Part I: Medicare Part A and Part B, Other Providers and Suppliers, pages I-21 at This section states the following:

“Independent Therapists: Outpatient Physical Therapy Services

We will review outpatient physical therapy services provided by independent therapists to determine whether they were in compliance with Medicare reimbursement regulations. Previous OIG work has identified claims for therapy services provided by independent physical therapists that were not reasonable, medically necessary, or properly documented. Our focus is on independent therapists who have a high utilization rate for outpatient physical therapy services. Medicare will not pay for items or services that are not “reasonable and necessary.” (Social Security Act, § 1862 (a)(1)(A)) Documentation requirements for therapy services are in CMS’s Medicare Benefit Policy Manual, Pub. 100-02, ch. 15, § 220.3. (OAS; W-00-11-35220; various reviews; expected issue date: FY 2012; new start).

The reference provided in the OIG document, the CMS Medicare Benefit Policy Manual, provides 15 pages of regulations regarding the requirements for documenting therapy services. It outlines every required document in a complete therapy record from initial evaluation or re-evaluation to daily treatment notes, progress notes, and discharge notes. Each of these elements is required to demonstrate the medical necessity for the treatment, including treatment descriptions and treatment times in minutes, and conversion of these elements into billable HCPCS codes and ICD-9CM codes and units.

The recording of treatment time in minutes is a documentation requirement that enables the OIG investigative arm to look at high utilization rates for therapists. For billing purposes, these minutes are converted to units, which can be easily tracked in the claims system. If the OIG performs data analysis on outpatient therapy claims and finds a therapist with a high number of units per day, they may ask for the documentation to support the billing. The documentation then becomes the key to determine if there is overbilling, correct billing, or under billing of the claims.

Therapy services are made up of a number of modalities and procedures, some untimed supervised or unattended modalities (97010-97028), some one-on-one but untimed assessments or re-assessments (97001-97002), some constant attendance one-on-one and timed modalities requiring patient contact  per 15 minute units (97032-97039), some therapeutic procedures with direct one-on-one patient contact per 15 minute units (97110-97542), some therapeutic procedures with direct patient contact initial 1 hour and additional hour listed separately (97545-97546), active wound care management with direct one-on-one patient care per surface area or session (97597-97606), and other tests and measurements and orthotic and prosthetic management with one-on-one direct patient care per 15 minute units (97750-97799). Other codes, such as EMG and nerve conduction studies and unlisted procedures may also be billed for this provider type, but will not be pertinent to this discussion.

Why is documentation of therapy time so difficult?

CMS published a fact sheet entitled Outpatient Rehabilitation Therapy Services:  Complying with Documentation Requirements in September, 2011, which describes CERT findings regarding errors in outpatient physical therapy documentation. One of those was failure to document total time for procedures and modalities. In the text it notes that total treatment minutes of the patient, including those minutes of active treatment reported under the timed codes and those minutes represented by the untimed codes, must be documented.

Medicare contractors around the nation are finding it problematic that therapists often (and incorrectly) do not document their time in actual minutes for each procedure or modality code and do not always detail what is performed under each code. Since units, and rules for their use, are based on minutes of time, it is essential that actual minutes are documented and that the medical necessity, denoted as skilled and requiring the expertise of a therapist, is supported by the activities being performed.

What are the rules for units and time?

These rules can be found in the CMS Claims Processing Manual, Chapter (100-4), Chapter 5, § 20.2.C:

“C. Counting Minutes for Timed Codes in 15 Minute Units

When only one service is provided in a day, providers should not bill for services performed for less than 8 minutes. For any single timed CPT code in the same day measured in 15 minute units, providers bill a single 15-minute unit for treatment greater than or equal to 8 minutes through and including 22 minutes. If the duration of a single modality or procedure in a day is greater than or equal to 23 minutes through and including 37 minutes, then 2 units should be billed. Time intervals for 1 through 8 units are as follows:

Units Number of Minutes

1 unit: ≥ 8 minutes through 22 minutes

2 units: ≥ 23 minutes through 37 minutes

3 units: 38 minutes through 52 minutes

4 units: 53 minutes through 67 minutes

5 units: 68 minutes through 82 minutes

6 units: 83 minutes through 97 minutes

7 units: 98 minutes through 112 minutes

8 units: 113 minutes through 127 minutes

The pattern remains the same for treatment times in excess of 2 hours.

If a service represented by a 15 minute timed code is performed in a single day for at least 15 minutes that service shall be billed for at least one unit. If the service is performed for at least 30 minutes, that service shall be billed for at least two units, etc. It is not appropriate to count all minutes of treatment in a day toward the units for one code if other services were performed for more than 15 minutes…….

When more than one service represented by 15 minute timed codes is performed in a single day, the total number of minutes of service (as noted on the chart above) determines the number of timed units billed……

If any 15 minute timed service that is performed for 7 minutes or less than 7 minutes on the same day as another 15 minute timed service that was also performed for 7 minutes or less and the total time of the two is 8 minutes or greater than 8 minutes, then bill one unit for the service performed for the most minutes. This is correct because the total time is greater than the minimum time for one unit. The same logic is applied when three or more different services are provided for 7 minutes or less than 7 minutes……

The expectation (based on the work values for these codes) is that a provider’s direct patient contact time for each unit will average 15 minutes in length. If a provider has a consistent practice of billing less than 15 minutes for a unit, these situations should be highlighted for review.”

One can see that if you just document units instead of minutes, there will not be an accurate record of time spent. Further rules explain that time cannot be counted for rest time, time to get into the treatment area, independent exercise time, etc.

Why is this so difficult to do in daily practice?

One of the most common problems is that therapists document units, not time. Even if they do document time, they encounter difficulty when they later convert these minutes to units.

Here is a typical scenario in outpatient therapy practice:

Patient A comes in and is greeted by the therapist. She is placed on moist hot packs and interferential electrical stimulation to her right thigh and knee for 20 minutes followed by 8 minutes of ultrasound to her right knee. The therapist then greets patient B and sets him up with ice packs on his left shoulder for 15 minutes and tells him to start on his exercises with the shoulder wheel when his timer goes off. The therapist then assesses patient A’s range of motion and strength and teaches her a series of new exercises to be performed at home for a period of 27minutes. After that, patient A continues with exercise for another 15 minutes independently and works on the stationary bicycle for 20 minutes to further increase her range. While patient A is exercising, the therapist works with patient B on manual therapy for his shoulder for 23 minutes. While patient B is resting, she goes back to patient A and has her set up her next appointment. She also greets patient C and sets him up on hot packs for his ankle for 20 minutes and tells him to work on his home exercise program when the timer goes off  to warm up until she gets back. She then goes back to patient B and spends 28 minutes with him on passive and active assistive range of motion exercises for his shoulder before setting up his next appointment. The day progresses in this manner.

*Note: Moist hot packs and ice packs (97010) are always bundled codes and are not billed. 97014 (electrical stimulation – unattended) is an untimed code and is always one unit. 97035 (ultrasound) is a constant attendance modality billed in 15 minute units as above. 97110 (therapeutic exercise 1 or more areas each 15 minutes) is a timed code, and 97140 (manual therapy techniques 1 or more areas each 15 minutes) is a timed code.

You can see that it is difficult to keep track of time when you are working under these circumstances. What did the therapist charge and what should have been charged?

Patient A Units Patient A Minutes Patient B Units Patient B Minutes
1 unit 97014 20 minutes 2 units 97140 23 minutes
1 unit 97035 8 minutes 2 units 97110 28 minutes
2 units 97110 27 minutes
Total timed units 3 Timed minutes 35 Total timed units 4 Timed minutes 51
Total allowed timed units = 2 with 1 untimed unit Total allowed timed units =3

This therapist actually did document time and did not charge for independent exercise time or the bundled hot and cold packs (97010), however this billing is still over the units allowed because she charged each time without regard for the fact that the total number of units billed is constrained by total timed treatment time for timed codes. In the first case, she would be allowed to bill one unit of 97014 because it is an untimed code. She would then only be allowed two units of timed codes because total timed minutes are 35 minutes and for three timed units she would need a minimum of 38 minutes. She would therefore charge two units of 97110 (the code with the greatest time) and include the 8 minutes of 97035 which is documented in the record because she did not perform at least 15 minutes of ultrasound. To clarify, the bill would show that you charged for two units of exercise, while the documentation would show that the minutes for the ultrasound were included as part of the exercise.

For patient B, she is constrained by 51 minutes of timed treatment so she could divide that between one unit of 97140 and two units of 97110 since both took 23 minutes or more and she allotted the larger unit value to the one on which most time was spent.

What should you document for successful billing?

  • Document  time for each timed and untimed modality
  • Document time for evaluation
  • Document time for face to face procedures and detail rationale and what was done for each of those procedures to show medical necessity
  • Note total treatment time and total timed treatment time
  • Document when the patient performs some exercises independently vs. face to face time that would be skilled and medically necessary
  • Document total time to show that you considered that your total treatment time was less than the total time they were present in the clinic
  • Base codes on services documented and provided and justified in the medical record
  • Base units on minutes of time recorded and the time rules
  • Make sure that number of units billed is accurate and that timed units billed are not greater than allowed by timed treatment time


With all of the documentation rules for therapy, including certification and progress notes every 10 days, it is difficult to meet all the regulations. However, careful documentation will mean paid claims and no overpayments that must be returned. It will keep your unit utilization per day accurate, keep the RACs and OIG at bay when they data mine and show that you are committed to integrity in your practice.


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