Looking at the Numbers: 2021 Medicare Reimbursement
What began as a projected 9% cut in payment to therapists under Medicare and was later reduced to an estimated 3.6% cut may be whittled down even further thanks to a recently announced change to how payment is calculated. The change comes by way of an adjustment to the conversion factor, the multiplier applied to relative value units to determine Medicare Part B payment amounts. That figure changed from CMS’ planned $32.41 (precise number: $32.4085) rate to $34.89 ($34.8931) for 2021.
The new conversion factor is still a drop from the 2020 conversion factor of $36.09 ($36.0896), but one that’s far less severe than originally approved—a 3.32% decrease compared with the 10.2% reduction in the final fee schedule.
In some coding situations, the combination of factors may result in cuts less than the estimated 3.6% for this year:
- Therapeutic exercise (97110) will drop by an average of 3.3%, going from $31.40 to $30.36
- Manual therapy (97140) sees a similar percentage decrease, from $28.87 to $27.91
- Neuromuscular reeducation (97112) drops by 2.35%, from $36.09 to $35.34
- Therapeutic activities (97530) sees a 2.45% decrease from its 2020 level of $40.42 to $39.43 in 2021
In a few instances, the new payment levels could even result in slight increases, particularly for PTs/OTs conducting an evaluation or reevaluation. For example, in 2020, use of evaluation CPT codes 97161-97163 resulted in a payment of $87.70; that payment increases to $101.89 in 2021.
While the new conversion factor is good news for therapists and our clinics, any cut creates an impact to our business and patients. RehabVisions will continue to advocate to CMS and Congress on avenues for further relief.