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Expired Medicare Legislative Provisions and Therapy Claims with the KX Modifier Rolling Hold


CMS is committed to implementing the Medicare program in accordance with all applicable laws and regulations, including timely claims processing.  Several Medicare legislative provisions affecting health care providers and beneficiaries recently expired, including exceptions to the outpatient therapy caps, the Medicare physician work geographic adjustment floor, add-on payments for ambulance services and home health rural services, payments for low volume hospitals, and payments for Medicare dependent hospitals.  CMS is implementing these payment policies as required under current law.

For a short period of time beginning on January 1, 2018, CMS took steps to limit the impact on Medicare beneficiaries by holding claims affected by the therapy caps exceptions process expiration. Only therapy claims containing the KX modifier were held; claims submitted with the KX modifier indicate that the cap has been met but the service meets the exception criteria for payment consideration. During this short period of time, claims that were submitted without the KX modifier were paid if the beneficiary had not exceeded the cap but were denied if the beneficiary exceeded the cap.

Starting January 25, 2018, CMS will immediately release for processing held therapy claims with the KX modifier with dates of receipt beginning from January 1-10, 2018.  Then, starting January 31, 2018, CMS will release for processing the held claims one day at a time based on the date the claim was received, i.e., on a first-in, first-out basis. At the same time, CMS will hold all newly received therapy claims with the KX modifier and implement a “rolling hold” of 20 days of claims to help minimize the number of claims requiring reprocessing and minimize the impact on beneficiaries if legislation regarding therapy caps is enacted.  For example, on January 31, 2018, CMS will hold all therapy claims with the KX modifier received that day and release for processing the held claims received on January 11.  Similarly, on February 1, CMS will hold all therapy claims with the KX modifier received that day and release for processing the held claims received on January 12, and so on.

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