Effective January 1, 2018, CPT modifiers 96 "habilitative services" and 97 "rehabilitative services" will be in effect. CMS has added modifiers 96 and 97 to their edits (see MLN Matters MM10385 here) and modifier SZ is deleted as of December 31, 2017. Private payers should simply adjust their policies to use the 96 and 97 modifiers, but it is always wise to confirm with a benefits representative. Hopefully, this means everyone will be on the same page for identifying these services.
What is the difference between habilitative and rehabilitative? Simply put, rehabilitative services help patients restore functions or skills that had been lost, while habilitative services develop skills and functions that had not been previously acquired.
Previously, the SZ modifier indicated a service was performed for habilitative purposes, while no modifier indicated the service was for rehabilitative purposes. Now that CMS has deleted modifier SZ in favor of the AMA's 96 and 97, they will expect these modifiers to be reported for their respective services. Speculation on the reason for the two new modifiers suggests that they are intended to help payers better track the number of rehabilitative versus habilitative visits, both considered essential health benefits under the ACA, for coverage purposes.
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The OIG conducted a study dated June 2019 wherein they indicated that there were approximately $269 million in overpayments for polysomnography services for the period of 2014 through 2015. According to the OIG “These errors occurred because the CMS oversight of polysomnography services was insufficient to ensure that providers complied with Medicare requirements and to prevent payment of claims that didn’t meet those requirements.”
So what are those requirements?
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