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Billing for therapy services can be confusing, especially with modifiers 96 and 97. This blog explains how these codes differentiate between habilitative and rehabilitative services, with examples to guide you. Learn why accurate coding and clear documentation are crucial for insurance and efficient practice management.
Billing is already a tricky maze, but when it comes to distinguishing between different therapy treatments, things get even more tangled. In 2017, the AOTA federal mandate required separate visit limits for habilitative and rehabilitative services in many individual and small group health plans.
This move aimed to ensure equal coverage, but it also introduced a new challenge—insurance companies now often require providers to use specific modifiers when submitting claims.
These modifiers are meant to clarify the type of services provided, but interpreting and applying them can feel like trying to solve a billing puzzle without all the pieces. In this blog, we will cover the distinction between the two billing process and how you can navigate through them with ease.
Habilitative therapy is designed to help individuals acquire, maintain, or improve essential skills for daily life. In physical therapy, this often means working with patients who have developmental conditions.
For instance, habilitative therapy might involve helping a child with cerebral palsy learn to improve their mobility, such as walking or balancing, enabling them to gain independence in their daily activities. It's about fostering skills that were never fully developed.
When billing for habilitative therapy, it's crucial to recognize that these services are often considered essential health benefits and are typically covered by the patient’s health plan.
Proper documentation should emphasize the developmental need for the therapy and outline the expected outcomes. Since habilitative codes are distinct from rehabilitative ones, precise coding is vital to ensure correct reimbursement and avoid claim denials.
Let’s take the example of the child with cerebral palsy: Here, the documentation should clearly outline the developmental need for the therapy, such as improving balance and coordination, and the expected outcomes, like being able to walk independently.
Accurate coding is critical because habilitative services are billed differently from rehabilitative ones. Using the wrong code could result in claim denials or improper reimbursement. For instance, you would use a habilitative modifier (such as "96" in certain cases) rather than a rehabilitative one, ensuring the insurer understands the distinct purpose of the treatment.
Rehabilitative therapy is designed to help individuals restore lost skills or regain normal functioning after an injury, illness, or surgery.
Imagine a patient who underwent knee surgery. Physical therapy would focus on helping them regain mobility, strength, and range of motion in the knee joint. The goal is to restore their ability to walk, climb stairs, or return to physical activities they were capable of before the surgery.
When billing for rehabilitative services, the key is to demonstrate that the therapy is aimed at restoring lost function. For instance, in the case of a patient recovering from knee surgery, the documentation should clearly indicate that the therapy is focused on regaining mobility and strength.
The physical therapist must outline a rehabilitation plan, noting the specific goals—such as improving range of motion and the ability to walk without pain. Diagnosis codes related to the surgery or injury should be used to justify the need for the therapy, while progress reports highlight the patient’s improvement throughout treatment. Accurate coding and documentation ensure proper reimbursement for rehabilitative services.
Billing for habilitative and rehabilitative therapies is no walk in the park—think of it more like a detour with some insurance roadblocks. Some insurers offer separate coverage for each, while others bundle them together. To avoid hitting a dead end with denied claims, make sure you check the patient's coverage beforehand.
Let's take the example of a patient recovering from a car accident who needs physical therapy to regain mobility (rehabilitative). If the patient also has a developmental condition and requires therapy to learn new motor skills (habilitative), you'd be working on two fronts. That's like building the house and fixing the garage at the same time.
Both therapies might use similar techniques, but the goals are different, and the billing codes need to reflect that. Tailoring therapy to fit these dual needs is how you hit the sweet spot for effective care!
Billing codes can sometimes feel like deciphering an ancient language, but don’t worry—we’ve got you covered! If you’ve ever stumbled upon terms like “modifier 96” and “modifier 97,” you’re not alone. These are the billing world’s equivalent of having a map and compass in a dense forest. Introduced on January 1, 2018, these codes replaced the older SZ modifier, which was the go-to for marking habilitative services.
Let’s break down these codes with a bit of flair:
Think of this as the “New Skills” badge. Imagine a young patient learning to walk again after an injury—this modifier is used for habilitative services, which are all about helping someone gain new abilities or skills they didn’t have before. For instance, if a physical therapist is working with a child to improve motor skills, modifier 96 is the code that says, “We’re teaching something new here!”
This is the “Restoration” star. Picture a patient recovering their strength after a surgery—this modifier applies to rehabilitative services that focus on recovering lost functions. So, if a therapist is helping an adult regain the ability to lift their arm after a shoulder injury, modifier 97 is the code that communicates, “We’re restoring what was once lost.”
Insurance companies are increasingly focusing on these distinctions, making accurate coding a must. Clear documentation is like the “explanation” section of a mystery novel—it tells the insurance companies, “Here’s exactly what we did and why.”
Understanding the nuances between habilitative and rehabilitative therapy billing is not only beneficial for compliance and reimbursement, but also for ensuring that patients receive the appropriate care without undue financial burden.
For healthcare providers, it's advisable to consult with billing specialists or use updated billing software to navigate these nuances effectively. Patients should also be encouraged to understand their insurance benefits and communicate openly with their therapy providers to ensure a smooth billing process. Together, through clear communication and knowledge, we can navigate the intricacies of therapy billing with confidence.
As healthcare continues to evolve, staying informed and adaptable to billing practices will remain a key component of successful therapy management. Using billing technologies like SPRY Integrated Billing solution that clearly has the distinction stored in their database can help better navigate the entire process.
Read more such article on the SPRY blog.
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