Most therapists are familiar with the 8-Minute Rule, but if you'd like a refresher (or want to make sure you understand the details), this article breaks down everything from common mistakes to mixed remainders.
What is the 8-Minute Rule?
The 8-minute rule is used by pediatric therapists, including occupational therapists, physical therapists, and speech therapists, to determine how many units they should bill to Medicaid for any outpatient services they provide.
Each timed code is supposed to represent 15 minutes of treatment. Since not all treatments can be perfectly divided into 15-minute increments, the 8-minute rule exists to determine how many units you should bill for in those cases.
It is referred to as the 8-minute rule because that's the minimum length of therapy you must provide in order to receive reimbursement from Medicaid using a time-based treatment code.
Service-Based CPT Codes
When therapists submit billing to Medicaid for services rendered, CPT codes are used to indicate which services the patient has received. A service-based CPT code is one that denotes that services such as physical therapy examinations, or simple outpatient procedures and treatments, have been provided. These services cannot be billed for more than one unit, regardless of the time taken.
When only one service is provided in a day, providers should not bill for services performed for less than 8 minutes. For any single timed CPT code in the same day measured in 15 minute units, providers bill a single 15-minute unit for treatment greater than or equal to 8 minutes through and including 22 minutes.
Here's a cheat sheet that you can use to remind yourself how to bill for intervals up to eight units:
Time-Based CPT Codes
As you’ve probably guessed, these codes are used to indicate the amount of time that the patient spends in one-on-one procedures with the therapist. These cover all forms of constant attendance procedures, such as physical therapy exercises. Unlike service-based CPT codes, time-based CPT codes can be billed as multiple units in 15-minute increments. Meaning that one unit would represent 15 minutes of therapy.
A therapist must provide direct one-to-one therapy for at least 8 minutes to receive reimbursement for a time based treatment code.
When only one service is provided in a day, you shouldn't bill for services performed for less than 8 minutes. But if you're billing more than one timed CPT code on a calendar day, the total number of units that you can bill is constrained by the total treatment time.
CPT guidelines state that each timed code should represent 15 minutes of treatment rendered. However, not all treatments will neatly divide into 15-minute chunks for you. It is in these cases that the 8-minute rule is applied. As per the Medicaid rules, for a therapist to bill for a unit of time-based CPT code, which normally represent 15 minutes, they must provide at least 8 minutes of continuous therapy.
Mixed remainders are tricky. When you divide the total timed minutes by 15 and you get a remainder that includes leftover minutes from more than one service (code) those are mixed remainders. If the total of those remainders equals 8 (or more) then you can bill for additional unit of the service (code) with the greatest time. (The 8-minute rule chart above already takes into account mixed remainders.)
Here's an example:
38 Total Minutes
8 Total Minutes
3 Total Units
So 38 minutes equals three units.
Using the formula total time / 15 = units and then calculating the remainders allows more accuracy for assigning that extra unit.
By breaking down the remainders you can see which service to bill an additional unit for. 38 divided by 15 equals 2 and some change. So you assign one unit to each code.
Then, since manual therapy covers more of the leftover 8 minutes, another unit gets billed for that service. Again, Medicare's 8-Minute Rule cheat sheet (illustrated above) already takes into account remainders, but this formula gives you an easy reference.
A Common Mistake
Before you go, here are a couple of common mistakes to avoid:
Billing Other Payers According to Medicaid Rules
The 8-minute rule doesn't apply to all payers. Although some private insurance companies have adopted the 8-minute rule, not all of them have. For payers that don't follow Medicaid's guidelines, you'll need to make sure you're billing according to your agreement with that payer.
Mixed Remainder Mixups
Private insurance companies generally don’t allow for mixed remainders, so you can only bill if an individual activity totals more than 8 minutes.
In-House Billing Kit
We've put together some resources to help you bring billing in-house. This In-House Billing Kit includes:
A Verification Questionnaire to use when calling payers to verify coverage
A 50% off coupon for our billing course, The Essentials of Insurance Billing for Therapy
A Billing & Collections Checklist to guide you as you interact with caregivers
A Payment Policy Generator to help you set expectations for caregivers
7 Tips to Help with Billing & Collections handout
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