Medicare Paycut for Outpatient Therapy? and what to do about

9% Medicare Paycut for Outpatient Therapy? (and what to do about it)

Last Friday, something important happened in Washington DC.

Automatic spending cuts were triggered, cuts that will lead to a reduction of $11 billion in payments to healthcare providers (including physical therapists) for a variety of services.

That equates to a 2% reduction in Medicare payments.

It’s very, very likely that private insurers will follow soon.

Not many people are happy about it. In fact, President Obama’s exact words were “Forced budget cuts are dumb”

Patients will feel the impact.

There are 47 million Medicare patients in the United States (15% of the population) and soon, they may have a tough time finding providers.


The more Medicare patients in a practice, the lower the profit margins, the greater the hit on the practice.

Such practices may be forced, out of necessity, to turn away some Medicare patients.

Here’s the real tipping point.

The Medicare Multiple Procedure Payment Reduction (MPPR), set to go into effect on April 1, 2013 (despite the best efforts of the APTA) will result in a 6-7% decrease in payments for outpatient therapy services unless Congress takes action to stop it.

We already suffered a 6-7% payment cut in 2011.

Bottom line?

In 2013, the combination of the federal payment cuts and MPPR could lead to a FURTHER 9% cut in Medicare payments. PTs aren’t the only ones affected.

According to Dr. Jeremy Lazarus, president of the American Medical Association in an article on CNN:

“Over the last 12 years, Medicare payments to physicians have increased by only 4%, while the cost of providing care has jumped 20%”

In fact, Congress has blocked Medicare payment cuts from happening more than 20 times in the past 10 years.


Asking members of Congress to delay implementation of MPPR is a start.

But what you really want to do is to take a deeper look at your business model and re-engineer it to keep growing.

In fact, it’s pure insanity to ignore this.

I’ve decided to do something about this, with specific ACTION STEPS, and you have a chance to benefit.




In this webinar on Thursday, March 14 at 5 pm EST, you will discover techniques for:

  • Intelligent billing: The how and why of (legitimately) billing codes with the highest practice expense value
  • Strategic timing: How treatment duration can affect your payments
  • Income diversification: How to improve your business model to increase lifetime patient value
  • Medicare dependence reduction: Ways to reduce your depedence on Medicare and private insurers
  • MPPR repercussions: – How to calculate the impact of MPPR in your practice and plan ahead.

Click here if you want to register for this 45 minute webinar followed by 15 minutes of QA.

If you can’t attend it, the recording will be made available to you.

Let’s combat external forces by staying innovative.


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