Learn how Medicare’s 8-Minute Rule for therapy billing. Understand time-based CPT codes, avoid claim denials, and ensure proper reimbursement for therapy services.

Medicare has strict guidelines when billing for therapy services. If these guidelines are not properly followed, providers risk claim denials, delayed payments, or financial losses. 

One such key guideline that is frequently misunderstood is the Medicare 8-Minute Rule. Although it seems straightforward, most healthcare providers make minor errors that result in billing mistakes. 

Knowing this rule is important to bill correctly and to be in compliance. In this step-by-step guide, we’ll lay it out in simple English, provide real-world examples, and show you how to avoid common pitfalls. 

What codes apply to the 8-minute rule Therapy ? 

When billing for 8-Minute Rule for Therapy services, it is important to know the difference between service-based and time-based CPT codes. Correct coding will warrant correct reimbursements and possibly prevent claim denials. 

Service-Based CPT Codes 

Service-based codes are billed only once per session, irrespective of the duration of the service. Typically, these codes apply to evaluations, group therapy, and unattended treatments not corresponding to any distinct duration for the treatment. 

• Common Service-Based CPT Codes: 

• Physical Therapy Evaluation: 97161, 97162, 97163 

• Physical Therapy Re-Evaluation: 97164 

• Electrical Stimulation (Unattended): 97014 

• Hot/Cold Packs Application: 97010 

• Group Therapy: 97150 

In that context, these services, due to their non-timed services, can only be billed once per session irrespective of the time spent attending the service. 

Time-Based CPT Codes 

Time-based codes are billed in 15-minute intervals whilst requiring one-on-one skilled therapy for the entire duration of the service. The therapist must be working with the patient for direct and skilled service; supervision doesn’t count. 

Common Time-Based CPT Codes:  

• Electrical Stimulation (Manual): 97032 

• Ultrasound Therapy: 97035 

• Gait Training Therapy: 97116 

• Therapeutic Exercise: 97110 

• Manual Therapy: 97140 

• Neuromuscular Re-Education: 97112 

• Self-Care/Home Management Training: 97535 

• Prosthetic Training: 97761 

• Physical Performance Testing & Measurement: 97750 

 Why Accurate Coding Is Important?

 Correctly distinguishing between service-based and time-based CPT codes ensures compliance with billing regulations of Medicare and private insurance. Errors in billing can lead to diminished or completely denied claims, delays in billing, and possible audits. 

Service-based codes should only be billed once per session, even if treatment takes longer. 

On other hand, time-based codes should be billed for the total time spent in active skilled patient care. 

Following these coding guidelines will provide physicians with a way to process claims accurately and maintain high-quality patient care. 

Applicable CPT Codes for the 8-Minute Rule

CPT codes are categorized into two broad groups: time-based and service-based codes.

Service-Based Codes

• These codes are submitted only once for a session, regardless of the duration of the service.
• They are used for procedures that do not involve time spent with the patient.

Common Examples:

• Physical Therapy (PT) Evaluation – 97161, 97162, 97163
• PT Re-evaluation – 97164
• Electrical Stimulation (Unattended) – 97014
• Hot/Cold Packs – 97010
• Group Therapy – 97150

Time-Based Codes

• These are charged in 15-minute increments and necessitate direct, one-to-one contact with the patient.
• The therapist has to be actively working—just observing or treating another patient simultaneously is not enough.

Typical Examples:

• Electrical Stimulation (Manual) – 97032
• Ultrasound Therapy – 97035
• Gait Training – 97116
• Therapeutic Exercise – 97110
• Manual Therapy – 97140
• Neuromuscular Re-education – 97112
• Self-Care/Home Management Training – 97535
• Prosthetic Training – 97761
• Physical Performance Testing – 97750

Proper understanding of these codes assists in precise billing and reimbursement for the therapy treatments.

8-Minute Rule Chart & Unit Calculation Guide

Medicare (CMS) requires at least 8 minutes of direct treatment for each billable unit. Since each unit is based on 15-minute increments, you can follow these steps to determine how many units to bill:

Step 1: Add Up Total Treatment Time

• Combine the total time spent on timed services to see how many full 15-minute units you can bill.

Step 2: Identify Full 15-Minute Units

• Count how many complete 15-minute blocks were provided for each CPT code.
  • Example: 2 units of 97761 = 30 minutes of service.

Step 3: Handle Remaining Minutes (Mixed Remainders)

• If there are leftover minutes that don’t form a full 15-minute unit, CMS allows you to combine them with another service.
  • Example: 5 leftover minutes from 97110 can be added to 10 minutes of 97140 to create 1 billable unit for 97140 (15 minutes total).

Step 4: Apply the 8-Minute Rule for Extra Units

• If you have at least 8 remaining minutes of a service, you can bill for 1 additional unit.
• CMS allows 1 unit for any service lasting between 8 to 22 minutes under the 8-minute rule.

Example Calculation

To better understand these steps, let’s look at examples below that illustrate how to calculate billable units correctly.

The AMA’s Rule of Eights Explained

The American Medical Association (AMA) has another method referred to as the “Rule of Eights,” or Midpoint Rule. In contrast to the Centers for Medicare & Medicaid Services (CMS), which sums up total session time for all time-based codes, AMA considers each unit independently. A unit may be billed only when at least 8 minutes of solo treatment was rendered.

For example, if a physical therapist does 8 minutes of therapeutic exercise (97110) and an additional 8 minutes of manual therapy (97140), the Rule of Eights permits billing for two individual units—one for each.”.

Conversely, CMS’s 8-minute rule takes the total minutes of the two services (16 minutes) and divides it by 15, which comes out to exactly one billable unit. Under CMS’s tie-breaker rule, the provider would be required to bill just one of the services (97110 or 97140), not both.

Medicare Billing Guidelines for the 8-Minute Rule

When Medicare reviews your claim, they calculate how many 15-minute units you can bill based on the total time spent on timed services.

How the 8-Minute Rule Works:

• Medicare divides the total treatment time by 15 minutes.
• If at least 8 extra minutes remain after full 15-minute units, you can bill for an additional unit.
• If fewer than 8 minutes remain, you cannot bill for another unit.

Example Calculation:

A physical therapist provides the following services:

• 15 minutes of therapeutic exercise (97110)
• 8 minutes of therapeutic activities (97530)
• 5 minutes of manual therapy (97140)

Total treatment time: 15 + 8 + 5 = 28 minutes

Now, apply the 8-minute rule:

• 28 ÷ 15 = 1.86 units → This means 1 full unit with leftover time.
• First 15 minutes = 1 unit (97110 – therapeutic exercise).
• 13 minutes remain (8 from therapeutic activities + 5 from manual therapy).
• Since therapeutic activities (97530) had 8 minutes, it qualified for 1 additional unit.
• Manual therapy (97140) had only 5 minutes, which is not enough to bill separately.

Final Billing: 2 units total

• 1 unit for 97110 (therapeutic exercise)
• 1 unit for 97530 (therapeutic activities)

97140 (manual therapy) is not billable because it does not meet the 8-minute rule.

Other Important Medicare Billing Rules

Beyond the 8-minute rule, Medicare has additional billing guidelines that might apply depending on the specific services provided. Always check Medicare policies to ensure compliance.

Proper Use of Billing Modifiers:

When you bill claims, you have to use the appropriate modifiers so you can get reimbursed correctly. These are some of the most frequently utilized modifiers in physical therapy (PT), occupational therapy (OT), and speech-language pathology (SLP) billing:

• CQ / CO – You use this when a therapy assistant delivers at least 10% of a service (CQ for PTAs, CO for OTAs). If there is a supervising therapist actively involved, there is no need for this modifier.
• GA – When there is an Advanced Beneficiary Notice (ABN) on file when Medicare does not pay for a service.
• GO – When an occupational therapist renders services, typically in an inpatient or outpatient environment.
• GN – When a speech-language pathologist renders services in an inpatient or outpatient environment.
• GP – When a physical therapist renders services in an inpatient or outpatient environment.
• KX – Used when a patient has gone over Medicare‘s therapy cap, but the services are still medically necessary.
• XP – Used when a service is billed separately due to being done by another provider.
• 22 – Used when a procedure takes more effort than normal.
• 52 – Used when a provider decreases or waives part of a service at their discretion.
• 59 – Applied when charging two services that are not usually charged together, like NCCI edit pairs.
• 95 – Shows services delivered through telemedicine (live audio/video).

Managing Mixed Reminders in Billing:

“Mixed remainders” occur when remaining minutes include more than one billing code.

Example:

An occupational therapist delivers:

• 21 minutes of manual therapy (97140)
• 17 minutes of gait training (97116)

After determining billable units, there are 2 additional minutes of gait training and 6 additional minutes of manual therapy, for a total of 8 additional minutes—which is worth an additional unit.

Because manual therapy has more minutes than gait training, the therapist would bill the additional unit for manual therapy. If gait training had more minutes, the additional unit would be billed for gait training instead.

Billing for Assessment, Education and Management Time:

Time used for patient management, evaluation, and education may be charged as part of time-based CPT codes. Examples include:

• Pre-intervention evaluations
• Monitoring a patient‘s reaction to treatment
• Instructing the patient in self-care and exercises
• Providing information regarding their condition and treatment
• Recording care in the presence of the patient

Therapists often lose billable time by failing to include these tasks in their billing. As long as they are done face-to-face with the patient, they are included in the total treatment time.

Practical Medicare 8-Minute Rule Examples

Here’s an example of how the 8-minute rule applies to Medicare Part B billing for physical therapy:

Physical Therapy Billing Example:

A physical therapist spent 35 minutes on therapeutic exercise (97110) and 15 minutes on manual therapy (97140). This adds up to a total treatment time of 50 minutes (35 + 15).

Now, let’s calculate the billable units:

1. Divide 50 minutes by 15 (since each unit is 15 minutes), which equals 3 full units with 5 minutes left over.
2. Since the remaining 5 minutes is less than 8 minutes, it does not qualify for an additional unit under Medicare’s 8-minute rule.

Final billing: 3 units—allocated between 97110 and 97140—but no extra unit for the leftover 5 minutes.

Occupational Therapy Billing Example:

A therapist spent 27 minutes of therapy on prosthetic training (97761) for a patient following the delivery of a new prosthetic leg. The treatment involved 11 minutes of self-care training (97535) on the device. The total therapy time for the therapist is 38 minutes.

Here’s the calculation for the billing as per CMS guidelines:

Step 1: As the combined therapy time stands at 38 minutes, there are 3 units for billing.

Step 2: 97761 (training prosthesis) session entitles one unit of 15 minutes.

Step 3: Remaining 12 minutes from 97761 can be combined with an additional 3 minutes from 97535 and provide a second unit of 97761 billing.

Step 4: Then there are 8 minutes of 97535 that meet the criteria of one extra unit under CMS’s 8-minute rule.

Total final billing: 2 units of 97761 and 1 unit of 97535, equivalent to 3 billable units.

Speech-Language Pathology Billing Example:

A speech pathologist takes 35 minutes to provide cognitive function therapy (97129) to a patient who had a stroke. Prior to this, they took 55 minutes to administer a cognitive performance test (96125). The therapist had a total of 90 minutes with the patient, which justifies billing 6 units.

This is how the billing is done:

97129 (Cognitive Therapy): 2 units (with 5 minutes remaining).

96125 (Cognitive Performance Test): 3 units (with 10 minutes remaining).

96126 (Supplemental Testing): 1 unit. As there are 10 additional minutes from 96125, a fourth unit can be charged under 96125.

FAQs: Navigating the Medicare 8-Minute Rule

• Is the 8-Minute Rule a Mandatory Requirement?

When claiming reimbursement for Medicare Part B, you are required to adhere to CMS‘s 8-Minute Rule for Therapy aggregating timed procedure codes.

Private insurance companies, on the other hand, might not have the same rules. Some adhere to the 8-minute rule, others apply the AMA Rule of Eights, while others have other billing rules. To prevent delays or denials of claims, always verify the particular billing rules for each company.

• Can Documentation Time Be Billed?

You are not allowed to charge separately for documentation that you do after visiting a patient. But if you do documentation within the visit as you offer other services, the time can be added to your billing.

For instance, if a physical therapist instructs a patient during a visit and documents the same, then the combined time spent on the two activities can be billed. However, if the documentation has been completed post-visit, you cannot bill for those minutes in isolation.

• How to Handle Insufficient Remainder Units for a Full Timed Unit?

Here‘s an example: A physical therapist delivers a total of 42 minutes of treatment—30 minutes of therapeutic exercises, 7 minutes of therapeutic activities, and 5 minutes of manual therapy.

They can bill 2 units for therapeutic exercises. But what about the rest of the time?

As neither therapeutic activities nor manual therapy individually qualifies as a minimum for a full unit, the biller must combine them. The additional unit should be billed for therapeutic activities as it contains more time (7 minutes compared to 5 minutes).

• Best Practices for Medicare Compliance

Always ensure that your documentation supports the time spent providing direct, one-on-one care when using timed billing codes. Check the CPT code book and each payer’s guidelines to make sure you’re following the correct billing rules, including the appropriate version of the 8-minute rule.

For a deeper dive into medical billing solutions, revenue optimization, and compliance strategies, check out our trusted partner, RevMaxx.

Using a single system for EMR and billing can help maintain compliance with Medicare and other payers. Clinicient’s Insight Platform simplifies the process with features like:

• Automatic Unit Calculations: Rapidly produce claims with CPT code autoselection and unit calculation according to documented services.
• Customizable Payer rules: Billing Medicare, private, or commercial payers, the software adjusts to alternate versions of the 8-minute rule to lower errors and minimize compliance complexity.
• Automatic Medicare Updates: Remain ahead of new Medicare rules, NCCI edits, and other changes in compliance ahead of their enforcement.
• Financial Reports and Alerts: View detailed financial reports, therapy threshold alerts, auto-charge capture, and more to enhance billing effectiveness.

Compliance with Medicare regulations can be cumbersome, but a single system for EMR, billing, analytics, and compliance can keep your clinic in the lead.

• Where to Find Additional Resources on the 8-Minute Rule?

For additional information regarding Medicare‘s 8-minute rule, go to the CMS website or refer to these resources:

• Chapter 5 of the Claims Processing Manual
• CMS Manual System Notice on Reporting HCPCS Units

If you need specialty-specific guidelines, these organizations offer useful coding and billing information:

• APTA – Coding for Timed Codes
• AOTA – Coding and Billing Resources
• ASHA – Medicare CPT Coding Rules for SLP Services