Today's post comes from Tom Ambury, PT and compliance officer at PT Compliance Group, based off this month’s “Compliance Chat” blog post.

By now, I hope most of you are using functional outcome measures. If you haven’t started yet, you might want to consider taking the next few weeks to get prepared and begin the process in January of 2013. Why? Let’s start with the fact that physical therapy documentation is coming under greater scrutiny especially regarding demonstrating the medical necessity of the treatments provided. You may have heard me say this before, but physical therapists are paid to treat the impairments identified in the initial evaluation and restore the patient’s ability to function. So, to get paid for the services rendered, medical necessity will depend directly on how much we are able to improve the patient’s ability to function. In 2013, the scrutiny of our documentation will be even greater than this year.

How do we do objectively document improvement in function?

We need to objectively measure function by using specific objective functional outcome measures consistently throughout the episode of care. This means that we will need to administer functional outcome measures at the initial evaluation, re-evaluation/progress report, and discharge.

Of course, there are about a million and a half functional outcome measures available. So how do you go about choosing? There is a lot of information on the Internet about functional outcome measurement tools. I would recommend choosing those measures that work best for your practice. Medicare recommends FOTO, and FOTO is an excellent tool. It has been in use for a period of time that allows for comparative reports, and it has tools available to cover the entire body. A disadvantage of this tool can be cost. If you are on a tight budget and are at risk of having payments reduced in 2013, you could consider using some of the free functional outcome tools available. My understanding is you can customize your WebPT documentation system to include the functional outcomes tools you want to use.

How much time do I have to get ready?

You should be ready by the start of 2013. For Medicare, if you are a provider, you will need to start to participate in PQRS in 2013 in order to avoid a 1.5% mandatory reduction in what Medicare pays you in 2015. More immediate is the requirement by Medicare as part of the Middle Class Tax Relief Act that providers report functional outcome scores on the claims submitted for payment starting on January 1, 2013.  Let me outline how this will work:

  • There are special G-codes to put on the claim form for functional deficits and complexities; however, I do not see where on the claims form where one reports them.
  • We must report on the onset of therapy, every ten visits, and at discharge.
  • We must also report on claims where we expect to get paid for a re-evaluation.
  • We must document functional measurable goals on our evaluations and on the Plan of Care (POC).
  • We have until July 1 to be compliant with these new rules, and from that point, if you aren’t compliant, CMS will return the claims unpaid. The most concerning part regarding this bullet is that CMS will link compliance with this requirement to the Condition of Payment and non-compliance could result in potential False Claims Act liability.

Another important point is beginning on January 1, 2013, Medicare is implementing a claims-based data collection strategy designed to assist in reforming the Medicare payment system for outpatient therapy services. In my mind, what makes this particularly worrisome is that Medicare could be looking to determine the need for services, quality of care, and how much the beneficiaries value the service they received. If a therapist has a high percentage of Medicare beneficiaries that discharge themselves from physical therapy, Medicare could draw a conclusion that the services that therapist provided were not valued by the beneficiary. There is a scheduled testing period from January 1 to July 1, 2013. 

So, what to do?

  • Select the appropriate functional outcome tool(s) for your practice. You will need to have several in order to cover all body parts, pain, balance, and any specialties you might treat.
  • Train you staff in how to effectively administer the functional outcome tool. There is a lot riding on the change in score—your payment. Don’t just hand the tool to the patient to fill out on his or her own. Make sure the patient understands what is being asked.
  • Train your office staff to help or to even administer the tool. The office staff will be important in making sure the functional outcome tool is re-administered every ten visits or 30 days and at discharge.
  • Train your staff to make sure they understand the importance of performing progress reports on time.
  • Train your staff on the new coding requirements and work with your billers to make sure they understand the changes in claim generation and can process the claim correctly.
  • Once this starts with Medicare, we can anticipate that commercial payers will follow suit, although many already have PTs reporting functional outcome scores in order to get authorization for visits.

I am in no way trying to alarm you. My job in compliance is to inform you of pending risk. We need to identify, understand, and then develop a plan to minimize the risk. Thank you for this opportunity to chat with you about this important topic. I’m happy to answer any questions you might have about functional outcome measures. Feel free to post comments in the commenting section below. You can also contact me at or 888.680.7688.

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