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Direct Access and Reimbursement Part II

Posted Sep 07 2008 8:40pm

Reimbursement for Direct Access to physical therapy services is nothing if not variable and for all intents and purposes, mostly non-existent. Some states have providers than cover services without a previous referral, but most do not. This stands in stark contrast to practice acts, where the majority of states permit patients to physical therapy services without a referral. So the question becomes, if it is legal to access therapy services without a referral, why is this not covered by payors? The answer to this question lies in complicated political forces, and that some insurance providers regularly operate outside the realm of reason. That said, we can look at events in New Jersey to shed some light coverage for Direct Access.

Dr. Robertson, the author and publisher of this blog has been kind enough to invite me to provide some commentary on how the efforts now underway in New Jersey relate to reimbursement in general and Direct Access specifically. As a matter of full disclosure, I am the current President of the New Jersey Society of Independent Physical Therapists (NJSIPT) which is the organization currently promoting the legislative efforts noted above. It should also be noted that as the invited author of this article that any opinions expressed in this article are solely mine and do not necessarily represent the opinions of the NJSIPT.

There is probably no single more complex or controversial issue in health care than reimbursement and a full treatment of this issue is not possible in a blog article. That being said it does deserve continued exposure, exploration and discussion and that is the spirit in which I am approaching this topic.

The complexities of reimbursement arise from an abyss of the highly varied payer policies of profit driven commercial payers, a heavily regulated Medicare program, the compendium of state regulations regarding provision and payment for services and an entire medical industry struggling to survive in a competitive environment where margins are extraordinarily thin or non-existent.

As a practicing clinician and private practitioner it is from the perspective of standards by which I view these legislative efforts. As the healthcare industry has consolidated, there has been a concomitant decline in reimbursement as the insurers increased their stranglehold on the marketplace. Despite this, healthcare costs for musculoskeletal care have steadily increased. Over the past few years as draconian cuts in reimbursement approaching 60% have put my colleagues and I on the verge of financial collapse, it became evident that a severe conflict had developed pitting compliance with practice standards at direct odds with remaining financially viable. The question was how to rectify this imbalance. The answer was legislatively. This was confirmed at a recent legislative committee hearing where a member of the committee commented that it was the purpose of the legislature to ensure fairness when one party utilizes its position to the detriment of others.

In short this legislative effort in NJ seeks to ensure that providers are compensated fairly based on prevailing fees as determined by the state, that barriers to access are removed by ensuring that third party payers pay for medically necessary services when sought by consumers without a prior referral from a physician and that payers pay providers their share of the liability directly without regard for network participation status.

Although there is great variability as to what “Direct Access” means depending on the various state practice acts and other statutes, as previously mentioned in this blog by Dr. Robertson one of the greatest barriers to the actualization of “Direct Access” to Physical Therapists is the lack of coverage by third party carriers. The legislation currently pending in New Jersey provides for the coverage of Physical Therapists’ services when accessed directly by consumers. Considering the mounting evidence that medical costs are reduced when Physical Therapists’ services are accessed directly I am certain that all interested parties will realize benefit from this legislation including the third party payer community.

Mark F. Schwall, PT

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