Services Billing Rationale for Physical Therapy’s 8-Minute Rule

The 8-minute rule for physical therapy (PT) is linked to Medicare and Medicaid for providers to receive reimbursement. In addition to PTs, it also applies to occupational and speech therapists. It’s used to determine how many units should be billed for any outpatient services provided.

Each timed code aims to represent 15 minutes of treatment. Many treatments can’t be perfectly divided into quarter-hour segments.

The 8-minute rule is used to determine how many units to bill for active therapeutic services per session. The rule was created with patient care in mind. Therapists must provide direct one-to-one therapy for at least 8 minutes to receive reimbursement. This can be 8 minutes of manual therapy or 8 minutes of therapeutic exercises. This doesn’t apply to group activities.

The Impact of Physical Therapy’s 8-Minute Rule

 The rule’s parameters are complicated, but they’re key to receiving correct payment for services rendered. Configuring treatment services to best meet client’s needs, while accurately tracking billing to optimize revenue is the goal. Many of the unbillable administrative tasks can be automated with a physical therapy electronic medical records (EMR) software platform.   

Time-based Local Coverage Determination (LCD) codes represent billable, skilled services provided to clients. The American Medical Association (AMA) supplies the LCD list. The stipulation is that services, including consultations, must be performed by skilled therapy providers. Time for activities that are determined to be unskilled, including administrative tasks and therapist preparation, aren’t billable.

When only one service is provided for a client in a day, it should be for at least 8 minutes. When billing more than one service-based CPT code per patient per day, the total number of billable units is determined by the total treatment time.

Adding to billing complexity, Current Procedural Terminology (CPT) guidelines state that each timed code billed should represent 15 minutes of treatment. The real world indicates that many treatments aren’t administered in 15-minute segments. Here’s where the 8-minute rule is applied.

The Medicare and Medicaid rules dictate that therapists bill for a 15-minute unit of CPT code. To achieve client care guidelines, at least 8 minutes of continuous therapy must be provided.

Then there are mixed remainders; more administrative work here… These occur when the total treatment minutes are divided by 15. The remainder includes leftover minutes when more than one service’s codes are used. If the remainders equal 8 or more, PT practices can bill for additional units of the service with the greatest allotted time. Use the formula total time / 15 = units to calculate the remainders to assign the extra unit to a billable code.

For even more billing administration complications, the 8-minute rule doesn’t apply to all payers. While some private insurance companies use the 8-minute rule, some have their own PT reimbursement guidelines. Payers that don’t follow Medicare/Medicaid guidelines, create more non-billable work for a practice’s staff.

Automating a Practice’s Physical and Fiscal Management

To maximize revenue for physical therapy practices, the practical goals include:

• Gaining more billable hours.
• Simplifying the billing complications associated with Medicare, Medicaid, and private insurers.
• Reducing reimbursement administrative costs.
•  Diminishing therapist’s unbillable time.
•  Increasing practitioner’s ability to generate increased revenue.
• Maximizing practice profit.

Each of these can benefit by using physical therapy electronic medical records (EMR) software. By automating administration and billing tasks, practices will have the necessary tools to ensure that clients’ services are being appropriately billed.

Using EMR software to manage a practice allows physical therapists more productive time with patients. It also lessens their administrative workload. 

The most useful practice-configured EMR systems have functionality including:

• Physical therapy medical billing
  • Reduce the time spent on things like insurance eligibility verification and billing while optimizing reimbursement rates and revenue.
• Mobile patient management
  • Providers can chart from any mobile device, for accurate charting and patient flow sheet notes at the time of the encounter.
• Telehealth physical therapy
  • Reach your patients where they are, with telemedicine software to schedule, invite and bill through a single platform.
•  Patient check-in kiosk
  • Through a patient check-in kiosk, new patients can register, while existing patients can update their insurance information.
• Secure patient portal
  • Patients can securely access their records, schedule appointments, sign documents, make payments, and complete forms, all from a HIPAA compliant patient portal.
• See the functionality of a physical therapy EMR system.