Refinements of the Medicare Outpatient Therapy Annual Expenditure Limit Policy

Peter Amico; Gregory C. Pope; Poonam Pardasaney; Ben Silver; Jill A. Dever; Ann Meadow; Pamela West

doi:10.2522/ptj.20140423

Tables

Table 1.

Characteristics of Annual per Capita Outpatient Therapy Utilization Among Medicare Fee-for-Service Beneficiaries, by Users of Each Therapy Discipline, 2011^{^a}

↵^a Therapy disciplines: PT=physical therapy, OT=occupational therapy, SLP=speech-language pathology. N=number of beneficiaries using a specified therapy discipline during 2011 (some beneficiaries utilized more than one therapy discipline during 2011). Allowed charges are the total provider payment allowed by Medicare, including both beneficiary cost sharing and Medicare provider payments. Therapy days are the total number of days for which a beneficiary received therapy. Calendar days are a count of the total days between the first visit and the last visit during the 12-month period (January 1, 2011–December 31, 2011). Therapy days per week=[(therapy days)/(calendar days)] × 7. The sample for this table is 100% of all Medicare outpatient therapy users in 2011 (N=4,898,689). Source: authors' analysis of 2011 Medicare claims and enrollment data.

Table 2.

Quantile Regression Predicting Annual Physical Therapy Expenditures^{^a}

↵^a The reference categories, which are reflected in the intercept term, are: age 65–74 y, female, non–end-stage renal disease, not originally entitled to Medicare by disability, non-Medicaid, osteoarthritis is the primary reason for therapy, and mobility scale score of 71–100 (highest mobility). The quantile regression predicts the 70th percentile of the per beneficiary annual physical therapy expenditure distribution. The primary reasons for therapy groups are mutually exclusive and exhaustive; each sample member is assigned to one and only one group. Expenditures are Medicare allowed charges. This table analyzes a convenience sample (N=4,210) of community-residing Medicare beneficiaries who presented for physical therapy at a provider participating in data collection during a specified 12-month period. *=significant at 10% level, **=significant at 5% level, ***=significant at 1% level. Source: authors' analysis of 2011 Medicare claims and enrollment and Developing Outpatient Payment Alternatives (DOTPA) data.

Table 3.

Alternative Outpatient Therapy Annual Expenditure Caps, Simulated for 2011^{^a}

↵^a Therapy disciplines: PT=physical therapy, OT=occupational therapy, SLP=speech-language pathology. Caps are Medicare allowed charges. The alternative caps are chosen so that total Medicare allowed charges above the caps is equal to current cap policy (and thus equal for each cap policy). The analysis assumes no behavioral response by providers or beneficiaries to changes in the therapy caps. “Average amount cap exceeded” is the total amount by which Medicare allowed charges exceed all applicable therapy caps divided by the number of beneficiaries exceeding at least one cap (therapy users above cap). “Therapy users above cap” indicates the count and percentage of therapy users who exceeded at least one cap. This simulation was conducted on a 100% sample of all Medicare outpatient therapy users in 2011 (N=4,898,689). Source: authors' simulation using 2011 Medicare claims and enrollment data.

Table 4.

Percentage of Beneficiaries Exceeding Risk-Adjusted and Non–Risk-Adjusted Annual Physical Therapy Expenditure Cap, by Diagnosis and Mobility Group^{^a}

↵^a The risk-adjusted cap is predicted from the quantile regression for the 70th percentile of annual physical therapy expenditures (Tab. 2). The non–risk-adjusted cap is our simulated 2011 physical therapy–specific budget-neutral cap of $1,710 (Tab. 3). Actual annual physical therapy expenditures are compared with the caps to determine the percentage of beneficiaries using physical therapist services with expenditures above the cap. Expenditures are Medicare allowed charges. The analysis uses a convenience sample (N=4,210) of community-residing Medicare beneficiaries who presented for physical therapy at a provider participating in data collection during a specified 12-month period. Source: authors' analysis of 2011 Medicare claims and enrollment and Developing Outpatient Payment Alternatives (DOTPA) data.