Claims for therapies remain one of the most modifier-dense in healthcare. Under the Affordable Care Act, non-grandfathered health plans must cover habilitative and rehabilitative services as essential health benefits.
However, tracking these services can be challenging. As a result, the American Medical Association (AMA) introduced two informational CPT modifiers, 96 (used for habilitative services) and 97 (reported for rehabilitative services).
In this guide, we will focus on modifier 97, provide its description, discuss its applicable scenarios, and understand the billing guidelines for discipline-specific therapy modifiers. After all, the following allied healthcare practices use the 97 modifier for billing:
- Physical therapy
- Occupational therapy
- Speech-language pathology
Modifier 97 – Description
According to the AMA CPT codebook, under the code range ‘Provider Services and Ambulatory Service Center Modifiers’, modifier 97 is described as:
“Rehabilitative services: Services provided to restore skills or function lost or impaired due to illness, injury, or disability.”
What does this mean? This modifier informs the payer regarding a therapy service provided to assist a patient in restoring skills or function, lost or impaired due to:
- Injury
- Illness
- Medical condition
Modifiers 96 and 97 are counterparts because modifier 96 is reported for similar therapy codes if a service is habilitative (i.e, develops the patient’s skills), whereas modifier 97 explains that the service was rendered for rehabilitation (to restore the patient’s functions).
Therefore, habilitative services are commonly provided in pediatric or developmental treatments. While rehabilitative services are reserved for instances like stroke or injury recovery.
Quick Look Back at the Modifier
Modifier 97 has been effective since January 1, 2018, alongside modifier 96 to distinguish rehabilitative and habilitative services. Modifier 96 replaced the HCPCS modifier SZ. This change was primarily driven by ACA requirements to track habilitative and rehabilitative services separately for benefit limits.
Insurers needed to count habilitative and rehabilitative visits for crucial health benefit limits, and thus, the modifier was introduced.
Scenarios Where Modifier 97 is Applicable
Modifier 97 may apply to various clinical situations, but the following is a breakdown of the most common ones.
Note that since the modifier is rehabilitative, patients must have a previously functional skill (lost or impaired) that can be restored via therapy.
Physical Therapy for Ischemic Stroke
Consider the case of a 67-year-old patient who sustains a cerebral artery ischemic stroke in the left middle region. This leaves her with a hemiparesis on the right side, plus an impaired gait. She is moved for acute hospitalization and referred to an outpatient physical therapy for:
- Gait training
- Balance retraining
- Lower-extremity therapeutic exercise
The primary aim of the care plan is to restore the patient’s pre-stroke level of ambulation. After the service, the physical therapist bills CPT code 97110 (therapeutic exercises) with modifier 97 to identify the service as rehabilitative, per the payer’s billing policy.
Physical Therapy Post Distal Radius Fracture
Take the case of a 54-year-old female patient who undergoes internal fixation and open reduction of a distal radius fracture.
The patient sustained a fracture after a fall and presents to the physician’s clinic for cast removal. The physician refers her for occupational therapy to restore:
- Activities of daily living (ADLs)
- Grip strength
- Fine motor coordination
Note that the patient was able to do these functions easily prior to the injury. Following the occupational therapy service, CPT code 97530 (therapeutic activities) is billed with the modifier 97 to indicate its rehabilitative nature, as required by payer policy.
Speech-Language Pathology
Imagine a 72-year-old male patient who develops oropharyngeal dysphagia as a result of a brainstem stroke. Additionally, the patient fails the bedside swallow screen, so a videofluoroscopic swallow study is used to confirm aspiration.
For treatment, the patient is sent for an outpatient speech-language pathology evaluation. The therapy aims at rehabilitating swallowing. Following the therapy, the team bills CPT code 92526 with modifier 97.
Important Note: Modifier 97 is not limited to PT and OT alone; it applies to all three rehab disciplines if the service is for restorative purposes.
Modifier 97 – Billing Guidelines
Ensuring the accurate use of modifiers in billing is imperative to avoid delays and reimbursement dismissal. For modifier 97, the following guidelines apply:
Apply Modifier for Rehabilitative Intent Only
Some therapeutic services are both habilitative and rehabilitative in nature. For example, CPT code 97110 for therapeutic exercises can also be reported when exercises are performed for habilitative purposes, i.e., helping a patient acquire a function they did not develop earlier.
For instance, if physicians are teaching a child with cerebral palsy to ambulate, use modifier 96 instead of 97, as using them interchangeably within a single claim line is not right.
Append the Modifier with Therapy-Specific Modifiers
UnitedHealthcare’s Habilitative and Rehabilitative Services Policy follows the CMS framework. According to this, providers must continually report therapy-specific modifiers when reporting modifier 97. As a general rule:
- Modifier GN applies when services are rendered under a speech-language pathology plan of care.
- Modifier GP is used to identify services delivered under a physical therapy plan of care.
- Modifier GO is appended when services are performed under an occupational therapy plan of care.
Quick Insight: Modifier 97 does not replace GN/GO/GP; it supplements them.
Append PTA and OTA Modifiers Correctly
According to CMS’s Billing Examples Using CQ/CO Modifiers, modifier CQ (for physical therapy services by a PTA) or CO (for occupational therapy services for OTA) must be reported when a therapist’s assistant provides more than 10% of the service. This requirement is in accordance with the CMS’s de minimis standard.
Document Rehabilitative Intent in the Medical Record
According to the requirements, the care plan should state specific details regarding the procedure. These include the:
- Function or skill being restored
- Patient’s prior function level
- Measurable goals
- Impairment base level
Remember, if the documentation does not support the service’s restorative purpose, the claim will likely be denied.
Check for Payer-Specific Requirements
Typically, most commercial insurers have similar requirements for modifiers 96 and 97. The modifiers are used to track ACA essential health benefit visit limits for rehabilitative and habilitative services separately.
More importantly, traditional Medicare or Medicaid, and grandfathered plans typically do not require an ACA habilitative/rehabilitative visit cap. Traditional Medicare does not require modifiers 96 or 97 for claims processing. However, many commercial payers use them to track habilitative and rehabilitative services.
Therefore, you should review the payer’s policy manual before you append the 97 modifier.
Use Modifier 97 with Applicable CPT Codes
Modifier 97 can be appended commonly with:
- 97000 series (PT/OT evaluations and procedures)
- 92500 series (SLP services)
Modifier 97 should only be appended to therapy-related CPT codes and does not apply to surgical, imaging, or purely diagnostic services.
Partner with MediBillMD for Streamlined Therapy Billing
Modifier 97 looks simple enough, but requirements can stack up quickly, especially when it must be used with therapy modifiers, like GN, GO, GP, CQ, and CO, each with its specific pairing requirements. Additionally, payer expectations can add complexity.
If your team is losing time to reimbursement rejections for therapy services, MediBillMD’s medical billing services ensure they focus on patient care rather than claim resubmissions.
