As an occupational therapist, your job goes far beyond just working with patients. Getting billing right is crucial—it ensures your patients get the care they need and your practice gets paid on time. The billing process in occupational therapy involves evaluation codes, insurance rules, and local laws.
You also need to track billing units alongside traditional CPT codes in your therapy sessions. These units help detail the specific therapeutic treatments you perform.
Staying on top of the ever-changing requirements for documenting medical billing services can feel overwhelming. This article breaks down everything you need to know about billing units in occupational therapy, so you can successfully proceed with the claims process.
So, without further ado, let’s dive into the deets of physical therapy billing guidelines.
Understanding Occupational Therapy Billing Units
To ensure your occupational therapy claims are successful, you need to handle several key details:
- Thoroughly document the outpatient therapy services you administered.
- Use the patient’s diagnosis code (ICD-10) to specify their condition.
- Apply the Current Procedural Terminology (CPT) codes describing your services or procedures.
- Include occupational therapy billing units to indicate how long each service lasts.
- Fill out the correct claim form according to the requirements of the patient’s insurance company.
One crucial aspect of this process is understanding occupational therapy billing units. Unlike basic medical status codes, these units specifically quantify the duration of services provided, ensuring accurate billing and reimbursement. Understanding these subtle differences is key to interpreting the complexities of claim submissions effectively.
What are Billing Units in Occupational Therapy?
So, what exactly do we mean by billing units in occupational therapy?
Billing units are codes that specify how long you spent providing a particular occupational therapy service. Insurance companies use these codes to determine how much they will reimburse for each session, as coverage often depends on the amount of time spent and the specific treatment plan.
In occupational therapy, there are two main types of billing units: untimed and timed. Untimed units are used for services like initial evaluations, where the duration of the session doesn’t affect how many units are billed.
On the other hand, timed codes follow the “Physical Therapy 8 Minute Rule.” This rule means that billing units start at eight minutes and increase in 15-minute increments thereafter. This system ensures that billing accurately reflects the time spent delivering therapy.
You might also want to read: Your Complete Guide to Medicare’s 8 Minute Rule
Billing Units vs. Billing Codes
In healthcare billing, there’s a difference between billing units and billing codes:
Billing codes, like CPT codes, describe exactly what type of service or procedure was done for the patient.
Billing units, on the other hand, tell us how much time was spent delivering that service or procedure.
For services that require a specific amount of time, providers use timed CPT codes, which require a corresponding billing unit.
There are several common evaluation codes used for untimed sessions:
- Low complexity (97165): Takes about 30 minutes and identifies one to three performance issues.
- Moderate complexity (97166): Lasts around 45 minutes and identifies three to five performance issues.
- High complexity (97167): Takes up to 60 minutes and identifies five or more performance issues, considering multiple treatment options.
Providers also use a re-evaluation code (97168) during follow-up appointments to reassess progress and make adjustments to treatment plans.
Knowing these distinctions helps providers accurately document and bill for occupational therapy services.
Timed vs. Untimed Codes
Understanding the appropriate use of timed codes in your occupational therapy practice is crucial for accurate claim submission.
Each CPT code specifies whether it requires a timed billing unit. Activities such as therapeutic exercises or primary procedures typically require timed units, whereas tasks like manual muscle testing during initial evaluations may fall under untimed evaluation.
Following the guidelines outlined in the Medicare benefit policy manual, insurance providers adhere to the physical therapy 8 minute rule. This rule requires that services provided for more than eight minutes must include a timed modifier of at least one unit to be billable under Medicare Part B. Services lasting less than eight minutes are not billable.
Once the eight-minute mark is surpassed, billing progresses in increments of 15 minutes:
- 1 unit: 8 to 23 minutes
- 2 units: 23 to 38 minutes
- 3 units: 38 to 53 minutes
- 4 units: 53 to 68 minutes
- 5 units: 68 to 83 minutes
- 6 units: 83 to 98 minutes
- 7 units: 98 to 112 minutes
- 8 units: 113 to 127 minutes
For example, if you conduct 20 minutes of therapeutic exercise involving direct one-on-one patient interaction, you would bill one unit. It’s important to note that any interruptions in service, such as adjusting equipment, pause the timing. Medicare only considers minutes of skilled therapy or direct one-on-one patient contact when calculating billable units.
What is Included in an Occupational Therapy Evaluation?
During an occupational therapy evaluation, several important aspects are considered to configure the treatment plan to each individual’s needs.
Firstly, there’s the “Occupational Profile,” which gets into the patient’s personal and occupational history. This includes understanding their interests, values, daily routines, and what matters most to them in their everyday lives.
Next, we gather the “Patient History,” which covers their medical and therapeutic background. This helps us understand their current health status and any previous treatments or conditions that may affect their therapy.
“Clinical Decision Making” plays a crucial role in developing a personalized intervention plan. Based on the assessment findings and the patient’s goals, we design strategies to improve their ability to perform daily activities effectively.
The “Plan of Care” is then formulated. This involves outlining specific goals and strategies to address the patient’s challenges comprehensively. The aim is to ensure that every aspect of their physical, cognitive, and psychosocial well-being is considered.
The evaluation’s depth and focus depend on the complexity of the patient’s condition and the specific skills (physical, cognitive, or psychosocial) that need attention. This holistic approach helps us create a special therapeutic plan that best supports the patient in achieving optimal daily functioning.
Common CPT Codes for Occupational Therapy
Here are the occupational therapy billing codes along with their descriptions:
| Code | Description |
| 97110 CPT Code | Therapeutic procedure, one or more areas, each 15 minutes |
| 97112 CPT Code | Neuromuscular reeducation of movement, balance, coordination, kinesthetic sense, posture, and/or proprioception for sitting and/or standing activities |
| 97113 CPT Code | Aquatic therapy with therapeutic exercises |
| 97116 CPT Code | Gait training (includes stair climbing) |
| 97124 CPT Code | Massage, including effleurage, petrissage, and/or tapotement (stroking, compression, percussion) |
| 97129 CPT Code | Therapeutic treatments that target cognitive abilities such as attention, memory, reasoning, executive function, problem-solving, and pragmatic skills, alongside strategies to aid in activity performance like time management, task initiation, organization, and task sequencing. This involves direct (one-on-one) interaction with the patient, lasting for the initial 15 minutes. |
| 97035 CPT code | Therapeutic ultrasound treatments used by physical therapists to help patients with injuries and medical conditions |
| 97139 CPT Code | Unlisted therapeutic procedure (specify) |
| 97140 CPT Code | Manual therapy techniques (e.g., mobilization/manipulation, manual lymphatic drainage, manual traction) 1 or more regions, each 15 minutes |
| 97150 CPT Code | Group therapeutic procedures involving two or more individuals. It’s crucial to understand that group therapy is not time-based and should be reported separately for each group member. |
| 97530 CPT Code | Direct therapeutic activities involving one-on-one patient interaction, utilizing dynamic tasks aimed at enhancing functional performance, for each 15-minute session. |
97633 CPT Code | Sensory integrative techniques to enhance sensory processing and promote adaptive responses to environmental demands, direct (one-on-one) patient contact, each 15 minutes |
| 97535 CPT Code | Training for self-care and home management, which includes activities such as daily living tasks (ADLs), compensatory training, meal preparation, safety procedures, and guidance on using assistive technology devices or adaptive equipment. This training involves direct one-on-one contact and is billed in increments of 15 minutes |
97537 CPT Code | Community/work reintegration training (e.g., shopping, transportation, money management, avocational activities and/or work environment/modification analysis, work task analysis, use of assistive technology device/adaptive equipment), direct one-on-one contact, each 15 minutes |
| 97542 CPT Code | Wheelchair management (e.g., assessment, fitting, training), each 15 minutes |
| 97545 CPT Code | Work hardening/conditioning; initial 2 hours |
| 97546 CPT Code | Each additional hour (List separately from code for primary procedure.) |
| 97166 CPT Code | Used for patients with complex needs, such as those with multiple health or functional issues. |
8-Minute Rule
Have you heard about the CMS 8-Minute Rule? According to recent guidance from CMS:
- When only one service is provided in a day, providers should not bill for services performed for less than 8 minutes.
- For a single timed CPT code measured in 15-minute units, providers should bill:
- 1 unit for treatment lasting 8 minutes through 22 minutes.
- 2 units for treatment lasting 23 minutes through 37 minutes.
- 3 units for treatment lasting 38 minutes or more.
This guidance ensures proper billing based on the duration of services provided, as outlined in the CMS Manual System.
| Units | Number of Minutes |
| 1 Unit | 8 minutes to < 23 minutes |
| 2 Units | 23 minutes to < 38 minutes |
| 3 Units | 38 minutes to < 53 minutes |
| 4 Units | 53 minutes to < 68 minutes |
| 5 Units | 68 minutes to < 83 minutes |
| 6 Units | 83 minutes to < 98 minutes |
| 7 Units | 98 minutes to < 112 minutes |
| 8 Units | 113 minutes to < 127 minutes |
The pattern will remain the same for treatment times exceeding 2 hours.
For instance, if an occupational therapist conducts therapeutic exercises in three different areas for a total of 38 minutes, they would bill for three units of the relevant CPT code.
How Billing Units and Billing Codes Work Together
In your occupational therapy practice, understanding how billing units and codes collaborate is essential for thorough claim processing.
Here’s a breakdown of how billing units and codes function together each time you submit a claim:
- Service Identification (ICD-10 and CPT Codes): Every patient visit involves a specific service that requires identification through ICD-10 codes for diagnosis and CPT codes for the services rendered based on clinical needs.
- Service Quantification (Units): Services are categorized into timed and untimed codes. Once services are identified, they are quantified using specific unit guidelines.
- Billing Statement Creation (CPT Code + Unit): The billing statement integrates the identified units with their corresponding codes, serving almost as modifiers.
- Auditing and Accountability (Code + Unit): Insurance companies scrutinize each claim to verify accurate documentation, including correct codes and units, session goals, patient treatment responses, and justification for treatment necessity. Regular in-house audits by your billing department help prevent claim denials.
Effectively managing billing units and codes in occupational therapy practices ensures precise claim submission. This approach guarantees that each service is accurately identified, quantified, and documented for successful insurance processing and financial transparency.
How to Use Billing Units in Occupational Therapy: A Practical Example
Understanding how to apply billing units in occupational therapy can be daunting without a practical illustration. Let’s explore a typical scenario using a hypothetical occupational profile to clarify the process.
Imagine you have a patient who visits your office regularly following their initial diagnosis. They attend weekly 30-minute sessions focused on therapeutic activities aimed at enhancing their functionality. When billing for these sessions, you don’t need to perform a new evaluation each time. Instead, you must correctly apply CPT codes and billing units based on the services rendered and their duration:
- Service Identification (CPT Code): The main service provided falls under therapeutic activities, categorized under code 97530.
- Quantification of Service (Billing Units): Since the patient attends a 30-minute session, CMS guidelines specify this as equivalent to two billing units. Even if a few minutes are spent on equipment setup rather than direct clinical engagement, the session still qualifies for the same billing units.
- Billing Statement (CPT Code + Units): Therefore, in your billing statement, you would list the CPT code 97530 and specify two units to reflect the duration and intensity of the service provided.
It’s essential to note that this example simplifies the process. Detailed documentation specific to each patient, including medical history and treatment rationale, is crucial for accurate billing and compliant record-keeping.
Occupational Therapy Documentation
In occupational therapy documentation, it’s crucial to follow a structured format known as SOAP. This helps therapists capture all essential details without missing anything important. Here’s how each part of SOAP works:
S = Subjective
This involves what the client tells you about their symptoms and feelings. It also includes input from their parents or caregivers, like any pain or fatigue they report.
O = Objective
Here, you record factual information from the therapy session. This includes how much help the client needed, the type of prompts given, what you observed during the session, how activities were adjusted, the client’s success rate in tasks, and their current progress towards their goals.
A = Assessment
After reviewing both subjective and objective data, this section summarizes what it all means. You will explain how the client is progressing, justify the therapy techniques you used, and note any significant changes in their abilities.
P = Plan
Finally, you outline what’s next. Do you need to tweak the treatment plan? Are new referrals necessary? Do you recommend any changes to help the client further?
Occupational Therapy Medical Billing and Coding Modifiers
| Modifier | Description |
| Modifier GO | Services provided as part of an outpatient plan of care for occupational therapy |
| Modifier GP | services that are delivered under an outpatient physical therapy plan of care |
| Modifier KX | used to verify medically necessary services |
| Modifier CO | services were carried out by an occupational therapy assistant following a treatment plan |
| Modifier CQ | specifies that services rendered were performed by a physical therapy assistant under a therapy plan of care. |
Source: HCPCS Level II – CMS Manual System
To Wrap Up
Billing and coding correctly is vital for every occupational therapy practice. At the Physician Billing Company, we are dedicated to providing helpful advice on how to use occupational therapy CPT codes effectively. Our aim is to help practices optimize their billing processes so they can maximize reimbursements.
For nearly 12 years, we have been supporting occupational therapy organizations nationwide, improving their financial health. Contact us to schedule a demo and learn how our AR recovery services, medical billing and coding services, or comprehensive revenue cycle management can benefit your practice. We are here to help you succeed.
