A Kansas Physical Therapy Practice Claimed Unallowable Medicare Part B Reimbursement for Some Outpatient Physical Therapy Services

A Kansas physical therapy practice (the Therapy Practice) claimed Medicare reimbursement for some outpatient physical therapy services that did not meet Medicare reimbursement requirements. Of the 100 beneficiary days in our random sample, the Therapy Practice properly claimed Medicare reimbursement on 71 beneficiary days. The Therapy Practice improperly claimed Medicare reimbursement on the remaining 29 beneficiary days. (A beneficiary day consisted of all outpatient therapy services provided on a specific date of service for a specific beneficiary, for which the therapist received a payment from Medicare.)

These deficiencies occurred because the Therapy Practice did not have adequate policies and procedures in place to ensure that it billed for services that complied with Medicare requirements.

On the basis of our sample results, we estimated that the Therapy Practice improperly received at least $134,000 in Medicare reimbursement for outpatient physical therapy services that did not comply with certain Medicare requirements.

We recommended that the Therapy Practice: (1) refund $134,000 to the Federal Government and (2) strengthen its policies and procedures to ensure that outpatient physical therapy services are billed in accordance with Medicare requirements. The Therapy Practice disagreed with our findings on 22 of the 31 beneficiary days that our draft report identified as not meeting Medicare reimbursement requirements. After reviewing the Therapy Practice's written comments, we revised our findings to disallow 29 instead of 31 beneficiary days.