Medicare Payment for Pulmonary Rehab Gets a Boost in 2015

December 26, 2015

Effective January 1, 2015, the payment rate for hospital outpatient pulmonary rehabilitation programs for Medicare beneficiaries who meet the guidelines for moderate, severe, and very severe COPD (CPT Code G0424) will be $52.35. This is a substantial increase over the past two years which saw rates hover between $39 and $37, respectively.

When actual claims data first became available subsequent to regulations implementing the national pulmonary rehabilitation program, we believe one of the reasons for the lower payment rate in the early days of coverage was due to the fact that hospitals were not establishing charges for G0424 that fully included charges for the combination of services that were previously reported separately and should have been taken into account in reporting the new single, bundled code. Some time ago, AARC and our sister pulmonary organizations and medical societies developed a Pulmonary Rehabilitation Toolkit designed to provide hospital billing departments with guidance on how to calculate appropriate charges for G0424. We believe the most recent data reflects more accurate reporting of charges and that the Pulmonary Rehabilitation Toolkit has made a difference.

In updating the physician fee schedule each year, the Centers for Medicaid and Medicare Services (CMS) reviews claims data to determine if changes in the assignment of codes to certain Ambulatory Payment Classification (APC) groups is warranted. Among other things, CMS looks at services based on resource and similarity to other services assigned within the APC.

Pulmonary rehabilitation (G0424) is assigned to APC 0340, Level II Minor Procedures, for calendar year 2015. APC 0340 also contains CPT Codes G0237 and G0238 used for non-COPD patients who receive individual respiratory therapy strength endurance and other services; thus, the payment rate for these codes is also $52.35. However, keep in mind that these codes are billed in 15 minute increments whereas CPT Code G0424 is billed per 1 hour session. Payment for the group exercise code for non-COPD patients, G0239, is lower than in the past two years at $29.23, down from $39. Based on CMS’ evaluation, it has been assigned to APC 450, Level I Minor Procedures.

We continue to encourage respiratory therapists to talk with their billing departments and remind them that the Pulmonary Toolkit is a valuable resource to ensure that future payments are not adversely impacted by under-representing the cost of providing pulmonary rehabilitation.