Here's everything you need to know about how therapists determine what to bill to Medicare for outpatient therapy services (aka, the 8-minute rule):

CPT Codes

There are two types of CPT codes you’ll need to understand in order to bill properly: service- and time-based.

  • Service-based (or untimed) codes are those that you'd use for things like conducting a physical therapy evaluation or re-evaluation, applying hot/cold packs or performing electrical stimulation (unattended). For these types of services, it doesn't matter if you complete the treatment in 15 minutes or 45, because you can only bill for one code.
  • Time-based (or constant attendance) codes, on the other hand, allow for variable billing in 15-minute increments when a practitioner provides a patient with one-on-one services, such as therapeutic exercise, manual therapy, neuromuscular re-education, therapeutic activities, gait training, ultrasound, iontophoresis and electrical stimulation.

The 8-Minute Rule

Here's where the 8-minute rule comes in: according to this article, in order to receive reimbursement from Medicare for a time-based code, you must provide direct treatment for at least eight minutes. Here are several examples from compliance expert Tom Ambury:

Example 1

If you perform an initial evaluation for 35 minutes and therapeutic exercise for seven, you would charge one unit of physical therapy evaluation. You cannot bill for therapeutic exercise because you performed this procedure for seven minutes. Per the 8-minute rule, you'd need to perform therapeutic exercise for eight minutes in order to bill.

Simple, right? Well, here's where it can get a little complicated. If you perform multiple time-based or constant attendance services, you must calculate the total number of direct timed minutes as well as the total treatment time. (Note that there's a cumulative and distribution portion of these calculations). According to Ambury, this is what determines how many — and which — units you can bill.

Example 2

On a single date of service, you perform 30 minutes of therapeutic exercise (EX), 15 minutes of manual therapy (MT), eight minutes of ultrasound (US), and 15 minutes of electrical stimulation unattended (ESUN). To correctly calculate the charge, you would add the constant attendance procedures and modalities:

30+15+8 = 53 direct timed minutes, which support four billing units. The 15 minutes of ESUN supports an additional supervised billing unit for a total of five units.

Now, that was the cumulative portion. For the distribution portion you must determine how many full 15-minute units you performed. In this example, there are two full 15-minute units of EX and one full 15-minute unit of MT, so that‘s three units out of four. The eight minutes of ultrasound is the remaining charge. Thus, the correct billing would be two units of EX, one unit of MT, one unit of US and one unit of ESUN.

Example 3

On a single date of service, you perform 30 minutes of therapeutic exercise (EX), 25 minutes of neuromuscular (NM), 17 minutes of manual therapy (MT), 13 minutes of therapeutic activity (TA), eight minutes of ultrasound (US) and 15 minutes of electrical stimulation unattended (ESUN). To correctly calculate the charge, you would add the constant attendance procedures and modalities:

30+25+17+13+8 = 93 direct timed minutes, which support six billing units. The 15 minutes of ESUN supports an additional supervised billing unit for a total of seven units.

Now, that was the cumulative portion. For the distribution portion you must determine how many full 15-minute units you performed. In this example, there are two full 15-minute units of EX, one full 15-minute unit of NM with 10 minutes left over, and one full 15-minute unit of MT with two minutes left over — all of which support four units of charge.

But what to do about those leftover minutes? As a reminder, we have 13 minutes of TA, 10 minutes of NM, eight minutes of US, and two minutes of MT remaining. This justifies two additional units, but which two? To determine this, compare the time left over from the incomplete units and then bill the two largest of the units remaining. In this example, you’d add one unit of TA (13 minutes) and one unit of NM (10 minutes).

Thus, the correct billing would be two units of EX, two units of NM, one unit of MT, one unit of TA, and one unit of ESUN.

According to Ambury: "The key to the 8-minute rule is to do the math. Calculate the total units justified by time; calculate the full 15-minute units; and if time justifies additional units, compare the minutes of the partial units remaining and bill the larger."

Now, a good EMR will provide you with plenty of help and alerts to ensure that you're billing appropriately and in compliance with the 8-minute rule. But you should still understand the basics and check your work to make sure everything is in order.

For reference, this article provides a great guide on how many units to report for different total treatment times. Have 8-minute rule questions? Ask them in the comments section below, and we'll find you the answers.