Tricare Update: Changes to Tricare’s Reimbursement Policy for Therapist Assistants

If you’ve heard some buzz about Tricare changing its reimbursement policy for services provided by therapist assistants, you’re not alone—after all, we recently reported on those changes right here on the WebPT Blog. But, there’s been some confusion regarding when, exactly, the changes will go into effect—and we’re here to clear it up. So, read on to learn when your organization can begin taking advantage of this policy shift.

The Current Payment Situation

Tricare pays for the healthcare services of authorized providers under the Civilian Health and Medical Program of the Uniformed Services (CHAMPUS). Only providers listed as authorized CHAMPUS providers can receive reimbursement from Tricare, and while occupational and physical therapists are listed as authorized CHAMPUS providers, occupational therapist assistants (OTAs) and physical therapist assistants (PTAs) are not. Thus, Tricare does not currently reimburse for OTA and PTA services, even if the services are supervised by a licensed occupational or physical therapist.  

Tricare rules don’t align with Medicare rules.

Tricare’s reimbursement policy for assistants is confusing in that it deviates from Medicare and most Medicaid programs. Furthermore, Tricare interprets the rules as applying to all therapy settings. For this reason, the AOTA recommends that only occupational therapists and physical therapists—not therapist assistants—treat Tricare beneficiaries. Otherwise, therapy providers may run afoul of the payment rules.

The Changes Ahead

Luckily, the rules are changing! On December 21, 2017, President Trump signed the National Defense Authorization Act FY 2018 (NDAA) into law, which includes a directive for the Secretary of Defense to update CHAMPUS policies to:

• include OTAs and PTAs as authorized providers under TRICARE and
• establish supervision requirements for licensed therapists. (Check out Section 721 of the NDAA for the exact language or read this AOTA summary of the new law.)

The policy updates have not gone into effect.

The NDAA is great news, especially for the clinic owners and managers who have to navigate these confusing payer regulations. But, does the passage of the NDAA mean PTAs and OTAs can now treat Tricare beneficiaries and bill for their services? Unfortunately, no—not yet. The government still has more work to do. To better understand what still needs to be done, read on for a mini-lesson in how government regulations are created and passed.  

Sometimes, Congress passes a law to direct federal agencies to solve a problem. This is the case with the NDAA. Congress directed the Department of Defense (DoD)—the government agency responsible for overseeing Tricare—to make the changes necessary to authorize OTA and PTA service reimbursement. Essentially, the NDAA served as an order to get some work done.

The DoD now has to get to work on implementing the law. It will do so by passing regulations, which is the DoD’s vehicle for creating laws.   

To be enforceable, the new rules must go through a formal rulemaking process.

Federal agencies like the DoD can create laws (known as regulations), but these regulations must go through a formal rulemaking process before they are enforceable. This process begins with the agency drafting and publishing the proposed rule in the Federal Register. Once that happens, the public has 30-90 days to comment on the proposed rule (a.k.a. the “notice and comment period”). The agency then reviews the comments and prepares its final rule. Once the final rule—or regulation—is published, it typically goes into effect 30 days later.

In the meantime, providers should continue to follow the current rules.

In this particular case, the DoD must use the formal rulemaking process in order to implement the reimbursement changes required by the NDAA. According to our sources at the AOTA, the DoD expects to publish the proposed rule in fall 2018 or spring 2019. Once the public notice and comment period has closed, the DoD will review the comments, publish the final rule, and update the manuals. Please note that the new regulation will not apply retroactively, which means OTAs and PTAs should continue following the status quo when it comes to treating Tricare beneficiaries—meaning they should not act as CHAMPUS-authorized providers for the time being.

So, there is still more work to be done before PTAs and OTAs officially become authorized Tricare providers. The exciting news is that in the near future, Tricare will possibly align with Medicare’s policies for the reimbursement and supervision of therapist assistants. In the meantime, stay tuned to the WebPT Blog, where we’ll continue to provide updates on this important development. For more up-to-date billing and compliance advice, check out this PT billing FAQ.