Proposed Medicaid Therapy Rate Cuts for 2013

Posted on July 5th, 2013 by Denise | No Comments

Proposed Medicaid Therapy Rate Cuts for 2013


Denise Koonce OTR

The 83rd Texas Legislative Session ended on May 27, 2013 after significant debate regarding public education, infrastructure, pediatric healthcare and much more.  It appeared that therapy services, as we know them, were to remain fairly intact with only some minor changes.  So the pediatric therapy community was very surprised to receive a notice from the Health and Human Services Commission (HHSC) stating they were proposing a rate reduction for physical, occupational, and speech therapy services of at least 3% for home care services and a 5% decrease for clinic services.  The announcement stated the background for the proposed rate reduction was to reflect applicable adjustments, in response to direction received from the 2014-2015 General Appropriations Act (Article ll, Senate Bill 1, 83rd Legislature, Regular Session, 2013), including reductions in the Health and Human Services portion of article ll, Rider 51, Medicaid Funding Reduction and Cost Containment.  The Health and Human Services Commission’s response and action to meet their cost containment was to propose arbitrary rate cuts for therapy services without looking into other possible cost saving options.     

In an effort to determine the best and most appropriate way to lower cost of services, HHSC appointed a therapy work group during the 82nd Legislative Session Interim to examine the policies, procedures and medical necessity guidelines currently in place.  The therapy work group completed a proposed list of possible savings excluding an arbitrary rate cut.  It appears that none of these recommendations have been implemented or reviewed for implementation prior to the rate reductions proposal. 

The Texas Health and Human Services Commission Rate Analysis Department will hold public hearings to receive comments regarding the proposed Medicaid rate reductions on July 10, 2013.  The hearing will occur in the Winters Public Hearing Room at 701 E 51st Street, Austin, TX 78751.  If you have any questions regarding the hearing document you may contact:

Megan Blood, Acute Care Rate Analysis

Texas Health and Human Services Commission

Phone: 512-730-7456 Fax: 512-730-7475


These proposed rate reductions are even more significant because, in addition to the HHCS proposed rate reduction, the Centers for Medicare and Medicaid Programs, a federal program, announced a 1.5% rate reduction to begin in January 2014.  Texas Medicaid is also making significant changes in their health insurance providers through Medicaid Managed Care Organizations or MCOs.  From a business stand point it is becoming more and more difficult to provide quality therapy services as federal and state rate reductions have continued over the past few years. 

Why is this important to you as a consumer, parent, or therapist?  The proposed rate reductions for therapy services, changes in health insurance providers and how they handle the authorization and certification of services will greatly impact therapy services as we know it today.  These reductions could force some therapy providers to close their doors.  Our community is already stretched because the demand for services is greater than our community’s ability to provide the services.  Therefore these rate reductions could decrease the parents’ options for therapy services in their area, the time frame in which services could begin and whether all the therapy services needed by an individual, can be provided by the same provider.     

What can you do to help make appropriate effective changes?  Contact you state legislator regarding the above proposals.  Express to them your personal concerns regarding the recommended changes and how it would negatively impact your life and the life of your loved one.  Thank you for supporting us in our efforts to continue to provide the best possible therapy services to the pediatric special needs population here in Houston.  Please share with us any additional actions you may be taking regarding these issues.

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