General Teaching Documentation and Coding Guidelines for Independent Billing of Physical and Occupational Therapy Services

Title: General Teaching Documentation and Coding Guidelines for Independent Billing of Physical and Occupational Therapy Services
Standard #:


Issued: 10/11/2005 Reviewed/Revision Date: 10/06/2009, 07/01/2012, 12/09/2014


Teaching Physician – A physician (other than another resident) who involves residents in the care of his or her patients

Resident – An individual who participates in an approved graduate medical education (GME) program or a physician who is not in an approved GME program but who is authorized to practice only in a hospital setting. The term includes interns and fellows in GME programs recognized as approved for purposes of direct GME payments made by the FI. Receiving a staff or faculty appointment or participating in a fellowship does not by itself alter the status of “resident”. Additionally, this status remains unaffected regardless of whether a hospital includes the physician in its full time equivalency count of residents

Physically Present – The teaching physician is located in the same room (or partitioned or curtained area, if the room is subdivided to accommodate multiple patients) as the patient and/or performs a face-to-face service.

Physical Therapy – Physical therapy services are those services provided within the scope of practice of physical therapists and necessary for the diagnosis and treatment of impairments, functional limitations, disabilities or changes in physical function and health status.

Occupational Therapy – Occupational therapy is medically prescribed treatment concerned with improving or restoring functions which have been impaired by illness or injury or, where function has been permanently lost or reduced by illness or injury, to improve the individual’s ability to perform those tasks required for independent functioning.

Direct Supervision – Direct supervision requirements are the same as in 42cfr410.32(b)(3). The supervisor must be present in the office suite and immediately available to furnish assistance and direction throughout the performance of the procedure. It does not mean that the physician/NPP/therapist must be present in the same room but in the office where the service is performed.

General Supervision – indicates that when a PTA provides services, either on or off the organization’s premises, those services are supervised by a qualified physical therapist who makes an onsite supervisory visit at least once every 30 days or more frequently if required by state or local laws or regulation.

PTA – is referred to as a physical therapy assistant

OTA – is referred to as an occupational therapy assistant


This standard governs documentation and coding guidelines relating to the Independent Billing of Physical and Occupational Therapy (“PT/OT”) therapy services.

Documentation requirements for billing Physical and Occupational Therapy:

  • Medical Necessity
  • Order/Referral
  • Evaluation/Reevaluation
  • Plan of Care
  • Certification/Recertification
  • Progress Report
  • Treatment Note
  • Justification statement (modifier KX)

Medical Necessity

Must require the expertise of the therapist. There is documentation of objective physical and functional limitations.  The type, frequency and duration of the treatment must be reasonable and medically necessary for the patient’s diagnosis/condition. There must be expectation that the condition or level of function will improved within a reasonable amount of time.


A medical record or other form of documentation indicating the patient is in need of physical or occupational therapy and is under the care of a physician/NPP is necessary to support services. A separate order/referral is not needed if the physician signed the plan of care.

If the order includes the plan of care no further certification is required.

Documentation must establish that the services are considered a specific and effective treatment for the patient’s condition under accepted standards of medical practice (i.e., such standards suggest that the patient will enjoy a significant practical improvement in a reasonable period of time) and that the services are of such complexity as to require performance by or under the supervision of a licensed therapist.


An evaluation requiring professional skills to make clinical judgments about conditions for which services are indicated based on objective measurements and subjective evaluations of patient performance and functional abilities.  An evaluation is necessary if the patient has developed a new diagnosis/condition where physical/occupational therapy services are needed.

Evaluations require, but are not limited too

  • Diagnosis
  • Description of specific problem to be evaluated and/or treated
  • Body part to be evaluated
  • All conditions and complexities that may impact treatment
  • Objective measurement
  • Subjective impression to describe the current functional status
  • Determination that treatment is needed or not needed
  • Prognosis with an expected time frame and plan of care
  • Documentation supporting illness severity or complexity
  • Patient health related to quality of life
  • Patient social support


Indicated periodically during an episode of care when the professional assessment indicates:

  • Significant improvement or decline
  • Change in patient’s condition or functional status

Reevaluation documentation to include:

  • Progress towards goals
  • Judgment about continued care
  • Modified goals and/or treatment or terminating treatment
  • Requires the same professional skills as an evaluation

Plan of Care

Although no physician supervision is required during therapy, the practice must maintain documentation that the patient is under the care of a physician (i.e., a doctor of medicine, osteopathy, or pediatric medicine) (“Treating Physician”) for a condition for which PT/OT is medically necessary, reasonable and appropriate. Services must be furnished under a written plan (“Plan of Treatment”) developed by the therapist or the Treating Physician. The Plan of Treatment must be documented as established prior to the initiation of PT/OT. The Plan of Treatment must be signed by the Treating Physician and placed in the patient’s medical record. The Plan of Treatment must include the following:

  • Patient’s significant past history.
  • Patient’s diagnosis requiring PT/OT.
  • All physician orders relating to PT/OT. Date plan of care established
  • Documentation of long term therapy goals (must be objective).
  • Documentation of factors indicating patient’s potential for achievement through PT/OT (also referencing any contraindications).
  • Patient’s awareness and understanding of diagnosis, prognosis, and treatment goals.
  • Periodic summary of PT/OT provided and results achieved.
  • The type, amount, frequency, and duration of therapy.


The medical record must include  a dated signature on the plan of care or some other document that indicates approval of the plan of care   within thirty (30) days after the plan of care has been established Recertification should be signed whenever the need for modification of the plan of care becomes evident or at least every 90 days.

Progress Note

A progress report helps to establish medical necessity for continuation of therapy services.  The report should include assessment of improvement, extent of progress toward each goal (objective measure), any plans for continuing treatment and any changes to long/short term goals.  Must be completed every 10 treatment days or at least once during every 30 calendar days.

Treatment Note

The treatment note records all treatments/modalities, time per treatment/modality and all skilled interventions.

Justification statement

The justification statement provides reasoning for services that are more extensive than is typical for the condition being treated. This statement can be documented separately or within the other documents for that treatment day. Modifier KX should be applied to the CPT code.

Units of Service

Bill the Medicare carrier on Form CMS-1500 using the practice corporation’s OTIPP/PTIPP provider number and specifying the units of therapy service furnished to the beneficiary on a given calendar day. Timed codes are typically billed in fifteen (15) minute increments (unless the appropriate HCPCS code descriptor specifies a separate unit-of-service measurement period in the code descriptor). When billing under a timed code with a fifteen (15) minute unit of service, the following units should be billed based upon the amount of time spent treating the patient.

Units Billed Treatment Minutes
0 Less than 8:00 minutes
1 8:00-22:59
2 23:00-37:59
3 38:00-52:59
4 53:00-67:59
5 68:00-82:59
6 83:00-97:59
7 98-112:59
8 113:00-127:59

If more than two (2) distinct timed HCPCS codes are furnished on a calendar day, the total units of service billed on that day is constrained by aggregate treatment time. For example, if a hospital furnishes 24 minutes of timed code A and 23 minutes of timed code B, total treatment time is 47 minutes. Therefore, only three (3) units of service could be billed for that day, even though four (4) units could have been billed in total had timed code A and timed code B been furnished on distinct days.

Only that time during which the therapist is “directly working with the patient to deliver treatment services” (or supervising a therapy assistant who is doing so) may be counted as treatment time. Pre-therapy and post-therapy services (e.g., paperwork) do not count as therapy minutes. Time spent waiting to use equipment, resting between exercise sets, or using the restroom does not count as therapy minutes.

Beginning and ending time for therapy must be documented on a contemporaneous basis in the patient’s medical record, along with a note describing the treatment, and the time spent delivering each service subsumed within the code.

A therapist cannot bill for more than one unit of service for a single 15-minute interval. The only exception is a timed code and a code defined by CPT as untimed and unattended (97010-97028).

Group Therapy

If a therapist is furnishing services simultaneously to two (2) or more individuals, the services are deemed “group therapy” and must be billed as such (using CPT Code 97150). This principle applies irrespective of whether the multiple patients are undergoing the same or different activities.

Physician Oversight

Oversight of Therapy Assistants and Therapy Aides

There is no coverage for services provided incident to the services of a therapist. Although PTAs and OTAs work under the supervision of a therapist and their services may be billed by the therapist, their services are covered under the benefit for therapy services and not by the benefit for services incident to a physician/NPP. The services furnished by PTAs and OTAs are not incident to the therapist’s service.

If a PT and PTA (or an OT and OTA) are both employed in a physician’s office, the services of the PTA (or OTA), when directly supervised by the PT (or OT),  may be billed by the physician group as PT or OT services using the PIN/NPI of the enrolled PT (or OT).

A therapist must supervise PTA/OTA. The level and frequency of supervision differs by setting (and by state or local law). General supervision is required for PTA/OTA in all settings except private practice (which requires direct supervision) unless state practice requirements are more stringent, in which case state or local requirements must be followed.

When services are furnished using therapy aides, therapists must document that they provided continuous and immediate supervision, and that the therapist provided some direct service to the patient during that visit. All aides’ notes must be countersigned by the therapist on the same day as the aide’s service. Aides must be employed by or under contract with the practice. Aide services should not be billed to government payers; for private payers, the use of aides should be pre-certified by the payer.

Oversight of Therapy Students

The services furnished by therapy students are not reimbursed by Medicare, even when provided under “line of sight” supervision by the therapist. The mere presence of the student in the room does not; however, render the billable service of a therapist non-billable. Thus, Medicare can be billed when there is sufficient contemporaneous documentation that either of the following is met:

  • Qualified therapist is present in the room for the entire therapy session; the student participates in the delivery of services when the qualified practitioner is directing the service, making the skilled judgment, and is responsible for assessment and treatment.
  • Qualified therapist is present in the room, guiding the student in service delivery when the therapy student is participating in the provision of services; the qualified therapist is not engaged in treating another patient or doing other tasks during this period.

Site of Service

Services must be documented as furnished in the therapist’s private practice office (i.e., space owned or leased by the practice and used exclusively by the practice while therapy is furnished) or in the patient’s home (which cannot be a hospital, critical access hospital, or skilled nursing facility).


Medicare Benefit Policy – Basic Coverage Rules (PUB. 100-02)
Chapter 15 – Covered Medical and Other Health Services
230 – Practice of Physical Therapy, Occupational Therapy, and Speech- Language Pathology (Updated through Rev. 106; Effective: 07/01/09; Issued: 04/24/09)


Questions regarding policies, procedures or interpretations should be directed to the USC Office of Culture, Ethics and Compliance at (323) 442-8588 or USC Report & Response at (213) 740-2500 or (800) 348-7454.