New Evaluation Codes for Physical Therapists

By Rick Gawenda, PT

January 2017

When the clock struck midnight on January 1, 2017, “out with the old and in with the new” applied to suppliers and providers of physical therapy services. That’s because effective January 1, 2017, Current Procedural Terminology (CPT) codes 97001 (Physical therapy evaluation) and 97002 (Physical therapy reevaluation) were deleted and replaced with 3 new CPT codes for physical therapy evaluation and 1 new CPT code for physical therapy reevaluation.

According to the American Medical Association CPT 2017 Professional Edition, the new CPT codes are as follows:

97161 – Physical therapy evaluation: low complexity, requiring these components:

A history with no personal factors and/or comorbidities that impact the plan of care;
An examination of body system(s) using standardized tests and measures addressing 1-2 elements from any of the following: body structures and functions, activity limitations, and/or participation restrictions;
A clinical presentation with stable and/or uncomplicated characteristics; and
Clinical decision making of low complexity using standardized patient assessment instrument and/or measurable assessment of functional outcome.
Typically, 20 minutes are spent face-to-face with the patient and/or family.

97162 – Physical therapy evaluation: moderate complexity, requiring these components:

A history of present problem with 1-2 personal factors and/or comorbidities that impact the plan of care;
An examination of body systems using standardized tests and measures in addressing a total of 3 or more elements from any of the following: body structures and functions, activity limitations, and/or participation restrictions;
An evolving clinical presentation with changing characteristics; and
Clinical decision making of moderate complexity using standardized patient assessment instrument and/or measurable assessment of functional outcome.
Typically, 30 minutes are spent face-to-face with the patient and/or family.

97163 – Physical therapy evaluation: high complexity, requiring these components:

A history of present problem with 3 or more personal factors and/or comorbidities that impact the plan of care;
An examination of body systems using standardized tests and measures addressing a total of 4 or more elements from any of the following: body structures and functions, activity limitations, and/or participation restrictions;
A clinical presentation with unstable and unpredictable characteristics; and
Clinical decision making of high complexity using standardized patient assessment instrument and/or measurable assessment of functional outcome.
Typically, 45 minutes are spent face-to-face with the patient and/or family.

97164 – Reevaluation of physical therapy established plan of care, requiring these components:

An examination including a review of history and use of standardized tests and measures is required; and

Revised plan of care using a standardized patient assessment instrument and/or measurable assessment of functional outcome.

Typically, 20 minutes are spent face-to-face with the patient and/or family.¹

Time Component

You may notice that each CPT code has a typical amount of time that the physical therapist spent face-to-face with the patient and/or family performing the initial evaluation or reevaluation; however, it is important to understand that all 4 of the new CPT codes are untimed and the physical therapist would only bill 1 unit of the appropriate CPT code. In addition, the specified amount of time is only a guide and does not play a factor in deciding which evaluation code to report.

So what does determine the level of evaluation reported by the physical therapist? At a minimum, the following components must be documented in the medical record in order to report the selected level of physical therapy evaluation:

History
Examination
Clinical presentation and decision making
Development of plan of care¹

History

History would include patient personal factors such as age, gender, education level, lifestyle, social background, past and current experience, coping styles, character, and attitudes. History may also include patient comorbidities. Examples could be obesity, diabetes, hearing loss, vision loss, and cognitive deficits. Personal factors and comorbidities that exist but do not impact the plan of care are not to be considered when selecting the level of a physical therapy evaluation.¹

Examination

To understand the impact the examination has on the level of evaluation code reported, we must first understand some definitions.

Body regions: head, neck, back, lower extremities, upper extremities, and trunk

Body systems: musculoskeletal, neuromuscular, cardiovascular pulmonary, and integumentary

Musculoskeletal system would include the assessment of gross symmetry, gross range of motion, gross strength, height, and weight.
Neuromuscular system would include the general assessment of gross coordinated movement such as balance, gait, transfers, and motor function (motor control and motor learning).
Cardiovascular pulmonary includes the assessment of heart rate, respiratory rate, blood pressure, and edema.
Integumentary system includes the assessment of pliability, presence of scar formation, skin color, and skin integrity.

Body structures: The structural or anatomical parts of the body, such as organs, limbs, and their components, classified according to body systems.

Activity limitations: A difficulty encountered by an individual in executing a task or action (e.g., mobility, self-care, domestic life).

Participation restrictions: A problem experienced by an individual in involvement in life situations (e.g., social interactions, family relationships, engaging in religious or spiritual activities).¹

As you can see, the therapist documentation of deficits of body structures and functions as well as how those deficits cause activity limitations and participation restrictions are crucial to the selection of the correct level of evaluation.

Clinical Presentation of the Patient

Clinical presentation is also an important piece of documentation completed by the evaluating therapist and contained in the initial evaluation documentation. CPT code 97161 states “A clinical presentation with stable and/or uncomplicated characteristics.” An example could be a patient who has centralized low back pain with no radicular symptoms and can be expected to progress in a certain manner during the episode of care.

CPT code 97162 states “An evolving clinical presentation with changing characteristics.” An example could be a patient who has had low back pain for the past 2 weeks, but 2 or 3 days ago, began experiencing tingling and burning sensations on the top and sole of his right foot.

CPT code 97163 states, “A clinical presentation with unstable and unpredictable characteristics.” An example could be a patient who has a sudden drop in blood pressure, becomes diaphoretic, or experiences difficulty breathing during the initial evaluation.

Clinical Decision Making

The therapist must use a standardized patient assessment instrument and/or measurable assessment of functional outcome during the initial evaluation. Examples include, but are not limited to, Disabilities of the Arm, Shoulder, and Hand (DASH), Quick DASH, Neck Disability Index, Oswestry, Lower Extremity Functional Scale, Berg Balance, Tinetti, Upper Extremity Functional Index, etc.

Deciding Which Evaluation Code to Report

You have completed the initial examination, documented the subjective reports of the patient and/or caregiver as well as the objective findings and patient assessment instrument, documented your assessment of the patient, and developed the plan of care. How do you determine what level of evaluation to report?

You must go back and look at the 3 categories: patient history, examination, and clinical presentation of the patient. The patient must meet the criteria in all 3 categories to bill that particular level of evaluation CPT code.

For example, in order to bill the moderate complexity evaluation code, the patient must have 1-2 personal factors and/or comorbidities that impact the plan of care, a total of 3 or more elements from any of the following: body structures and functions, activity limitations, and/or participation restrictions, and an evolving clinical presentation with changing characteristics.

If the patient only had a total of 3 or more elements from any of the following body structures and functions, activity limitations, and/or participation restrictions, and an evolving clinical presentation with changing characteristics, but had no personal factors and/or comorbidities that impact the plan of care, the therapist would have to select code 97161, Physical therapy evaluation: low complexity.

Let’s look at CPT code 97163, Physical therapy evaluation: high complexity. In order for the physical therapist to report this evaluation code, the patient must have 3 or more personal factors and/or comorbidities that impact the plan of care, a total of 4 or more elements from any of the following: body structures and functions, activity limitations, and/or participation restrictions, and a clinical presentation with unstable and unpredictable characteristics.

If the patient only had a total of 4 or more elements from any of the following: body structures and functions, activity limitations, and/or participation restrictions, and a clinical presentation with unstable and unpredictable characteristics, but had no personal factors and/or comorbidities that impact the plan of care, the therapist would have to select code 97161, Physical therapy evaluation: low complexity.

What insurance carriers will use the new evaluation and reevaluation codes?

Under the Health Insurance Portability and Accountability Act of 1996 (HIPAA), all HIPAA-covered entities must use the current year’s CPT codes. Covered entities are defined in the HIPAA rules as (1) health plans, (2) health care clearinghouses, and (3) health care providers who electronically transmit any health information in connection with transactions for which the U.S. Department of Health and Human Services (HHS) has adopted standards. Generally, these transactions concern billing and payment for services or insurance coverage. For example, hospitals, academic medical centers, physicians, and other health care providers who electronically transmit claims transaction information directly or through an intermediary to a health plan are covered entities. Covered entities can be institutions, organizations, or persons.

This means that hospital outpatient departments, skilled nursing facilities, rehabilitation agencies, comprehensive outpatient rehabilitation facilities, home health agencies, and private practices are an HIPAA-covered entity and are required to use the current year’s CPT codes. In addition, insurance carriers such as Medicare, Medicaid, Aetna, Cigna, Blue Cross Blue Shield (BCBS), United Healthcare, Humana, TriCare, etc., are also HIPAA-covered entities and are required to use the current year’s CPT codes.²

Who would not be mandated to use the new evaluation and reevaluation codes?

The HIPAA Privacy Rule does not apply to entities that are either workers compensation insurers, workers compensation administrative agencies, or employers, except to the extent they may otherwise be covered entities. The HIPAA privacy rule also does not apply to automobile medical payment insurance, coverage for onsite medical clinics, liability insurance, and coverage issued as supplemental to liability insurance.²

This means workers compensation and auto no-fault plans are not mandated by HIPAA to use the current year’s CPT codes and if they wanted to, could continue to use the old and deleted physical therapy evaluation and reevaluation and occupational therapy evaluation and reevaluation CPT codes. As a provider of outpatient therapy services, you will want to contact your various workers compensation and auto no-fault plans to see if they will switch to the new evaluation and reevaluation CPT codes effective with dates of service on and after January 1, 2017.

Will Insurances Pay for the New Evaluation Codes?

While insurance carriers must use the new CPT codes due to HIPAA, HIPAA does not mandate that the insurance carriers have to pay for the 3 new physical therapy evaluations or 3 new occupational therapy evaluations. Providers of physical therapy services will have to work with each of their insurance carriers to determine if they will recognize and pay for all 3 new evaluation codes.

Medicare Payment for the New Evaluation Codes

On November 2, 2016, the Centers for Medicare & Medicaid Services (CMS) issued the final rule for calendar year 2017 for services paid under the Medicare Physician Schedule. In the final rule, CMS finalized their proposed rule to pay the 3 new physical therapy evaluation codes the same dollar amount due to concerns of potential upcoding on the part of the physical therapist. CMS is concerned that if they paid each of the 3 new physical therapy evaluation codes a different rate that it would incentivize the physical therapist to report the higher complexity evaluation code in order to receive a bigger payment especially as physical therapists become familiar with the new requirements that must be satisfied to report each evaluation code.³

References

1. American Medical Association, Current Procedural Terminology; CPT 2017; Professional Addition.

2. Centers for Medicare & Medicaid Services; Are You a Covered Entity, www.cms.gov/Regulations-and-Guidance/Administrative-Simplification/HIPAA-ACA/AreYouaCoveredEntity.html. Accessed November 17, 2016.

3. Centers for Medicare & Medicaid Services, Medicare Program; Revisions to Payment Policies under the Physician Fee Schedule and Other Revisions to Part B for CY 2017; Medicare Advantage Bid Pricing Data Release; Medicare Advantage and Part D Medical Loss Ratio Data Release; Medicare Advantage Provider Network Requirements; Expansion of Medicare Diabetes Prevention Program Model; Medicare Shared Savings Program Requirements; Final rule, s3.amazonaws.com/public-inspection.federalregister.gov/2016-26668.pdf. Accessed November 17, 2016.

Rick Gawenda, PT, is the president of Gawenda Seminars & Consulting and is a member of the PPS Payment Policy Committee. He can be reached at info@gawendaseminars.com.

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