Medical Review Changes for Inpatient Rehabilitation Facilities (IRFs)

Two key areas the federal review contractors will be targeting next.

An MLN Matters article published on Dec. 11 reported on a recent advisement from the Centers for Medicare & Medicaid Services (CMS) to its medical review contractors related to therapy services in Inpatient Rehabilitation Facilities (IRFs). Consistent with what we are seeing in the field, two key areas were addressed in this guidance to contractors:

  • Therapy intensity of services

 

  • Individualized one-to-one therapy as the standard of care


Intensity of Service

Medical review contractors were advised that further review of claims should occur when at least three hours of therapy per day, at least five days per week (or, in certain well-documented exceptions, at least 15 hours of intensive rehabilitation therapy within a seven-consecutive day period) is not provided. Therapy hours include physical therapy, occupational therapy, speech-language pathology, or prosthetics/orthotics. CMS instructed that this further review will require the use of clinical review judgment to determine medical necessity of the intensive rehabilitation therapy program based on the individual facts and circumstances of each case, and it will not be based on any threshold of therapy time. 

The good news is that this guidance suggests that Medicare will not arbitrarily deny a claim for missing therapy minutes if the patient’s overall picture demonstrates that the care is reasonable and necessary to be performed in an IRF. The bad news is that there likely will be more upcoming audits based on the intensity of therapy services. 

Auditing the minutes of therapy, at least during the first two weeks, can be automated based on minutes reported in the IRF-PAI, making the identification of cases that do not meet the threshold more common. This trigger for medical review underlines the importance of documentation by clinical staff, both in daily notes and in the team notes, to demonstrate the reasons a patient has not received the requisite therapy – and to validate what changes are being made in the plan to meet the patients’ needs. There should also be support earned for ongoing IRF services by demonstrating that the patient has the potential to achieve goals.

Individualized One-to-One therapy as the Standard of Care

While CMS has frequently noted that the expectation for the therapy mode of care delivery is predominantly one-to-one services, we have seen an increase in denials when patients receive concurrent and/or group therapy, regardless of whether the preponderance of care is one-to-one. In this guidance, CMS further advised its medical review contractors that the standard of care for IRF patients is individualized (i.e., one-on-one) therapy. CMS further noted that group and concurrent therapy can be used on a limited basis, but it did not clarify the parameters for “limited.” Additionally, CMS advised that in those instances in which group therapy better meets the patient’s needs (on a limited basis), the situation/rationale that justifies group therapy should be specified in the patient’s medical record at the IRF. 

What’s the best course of action for IRFs?

Recent work with our clients demonstrates that therapy intensity and complexity is already being reviewed by medical review auditors. We recommend that IRFs review and improve their processes for:

  • Tracking and monitoring the minutes of therapy;

 

  • Clearly documenting missed minutes, reasons for missed therapy, and interventions to assure that the intensity is met;

 

  • Documenting the complexity of the therapy provided by ensuring that specific tests and measures and assessment of quality and safety of patient functional activities are included in the notes, rather than just repetitive language about increasing distance for locomotion, etc.; and

 

  • Assuring that the team documentation addresses participation in therapy as part of the ongoing assessment of IRF needs.

The aforementioned MLN Matters article can be located online at: https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNMattersArticles/Downloads/SE17036.pdf

 

Facebook
Twitter
LinkedIn

Angela Phillips, PT

Angela M. Phillips, PT, is President & Chief Executive Officer of Images & Associates. A graduate of the University of Pennsylvania, School of Allied Health Professions, she has almost 45 years of experience as a consultant, healthcare executive, hospital administrator, educator, and clinician. Ms. Phillips is one of the nation’s leading consultants assisting Inpatient Rehabilitation Facilities in operating effectively under the Medicare Prospective Payment System (PPS) and in addressing key issues related to compliance.

Related Stories

Leave a Reply

Please log in to your account to comment on this article.

Featured Webcasts

Sepsis Sequencing in Focus: From Documentation to Defensible Coding

Sepsis sequencing continues to challenge even experienced coding and CDI professionals, with evolving guidelines, documentation gaps, and payer scrutiny driving denials and data inconsistencies. In this webcast, Payal Sinha, MBA, RHIA, CCDS, CDIP, CCS, CCS-P, CCDS-O, CRC, CRCR, provides clear guideline-based strategies to accurately code sepsis, severe sepsis, and septic shock, assign POA indicators, clarify the relationship between infection and organ dysfunction, and align documentation across teams. Attendees will gain practical tools to strengthen audit defensibility, improve first-pass accuracy, support appeal success, reduce denials, and ensure accurate quality reporting, empowering organizations to achieve consistent, compliant sepsis coding outcomes.

March 26, 2026
I022426_SQUARE

Fracture Care Coding: Reduce Denials Through Accurate Coding, Sequencing, and Modifier Use

Expert presenters Kathy Pride, RHIT, CPC, CCS-P, CPMA, and Brandi Russell, RHIA, CCS, COC, CPMA, break down complex fracture care coding rules, walk through correct modifier application (-25, -57, 54, 55), and clarify sequencing for initial and subsequent encounters. Attendees will gain the practical knowledge needed to submit clean claims, ensure compliance, and stay one step ahead of payer audits in 2026.

February 24, 2026
Mastering Principal Diagnosis: Coding Precision, Medical Necessity, and Quality Impact

Mastering Principal Diagnosis: Coding Precision, Medical Necessity, and Quality Impact

Accurately determining the principal diagnosis is critical for compliant billing, appropriate reimbursement, and valid quality reporting — yet it remains one of the most subjective and error-prone areas in inpatient coding. In this expert-led session, Cheryl Ericson, RN, MS, CCDS, CDIP, demystifies the complexities of principal diagnosis assignment, bridging the gap between coding rules and clinical reality. Learn how to strengthen your organization’s coding accuracy, reduce denials, and ensure your documentation supports true medical necessity.

December 3, 2025

Proactive Denial Management: Data-Driven Strategies to Prevent Revenue Loss

Denials continue to delay reimbursement, increase administrative burden, and threaten financial stability across healthcare organizations. This essential webcast tackles the root causes—rising payer scrutiny, fragmented workflows, inconsistent documentation, and underused analytics—and offers proven, data-driven strategies to prevent and overturn denials. Attendees will gain practical tools to strengthen documentation and coding accuracy, engage clinicians effectively, and leverage predictive analytics and AI to identify risks before they impact revenue. Through real-world case examples and actionable guidance, this session empowers coding, CDI, and revenue cycle professionals to shift from reactive appeals to proactive denial prevention and revenue protection.

November 25, 2025

Trending News

Featured Webcasts

Mastering MDM for Accurate Professional Fee Coding

In this timely session, Stacey Shillito, CDIP, CPMA, CCS, CCS-P, CPEDC, COPC, breaks down the complexities of Medical Decision Making (MDM) documentation so providers can confidently capture the true complexity of their care. Attendees will learn practical, efficient strategies to ensure documentation aligns with current E/M guidelines, supports accurate coding, and reduces audit risk, all without adding to charting time.

March 31, 2026

The PEPPER Returns – Risk and Opportunity at Your Fingertips

Join Ronald Hirsch, MD, FACP, CHCQM for The PEPPER Returns – Risk and Opportunity at Your Fingertips, a practical webcast that demystifies the PEPPER and shows you how to turn complex claims data into actionable insights. Dr. Hirsch will explain how to interpret key measures, identify compliance risks, uncover missed revenue opportunities, and understand new updates in the PEPPER, all to help your organization stay ahead of audits and use this powerful data proactively.

March 19, 2026

Top 10 Audit Targets for 2026-2027 for Hospitals & Physicians: Protect Your Revenue

Stay ahead of the 2026-2027 audit surge with “Top 10 Audit Targets for 2026-2027 for Hospitals & Physicians: Protect Your Revenue,” a high-impact webcast led by Michael Calahan, PA, MBA. This concise session gives hospitals and physicians clear insight into the most likely federal audit targets, such as E/M services, split/shared and critical care, observation and admissions, device credits, and Two-Midnight Rule changes, and shows how to tighten documentation, coding, and internal processes to reduce denials, recoupments, and penalties. Attendees walk away with practical best practices to protect revenue, strengthen compliance, and better prepare their teams for inevitable audits.

January 29, 2026

AI in Claims Auditing: Turning Compliance Risks into Defensible Systems

As AI reshapes healthcare compliance, the risk of biased outputs and opaque decision-making grows. This webcast, led by Frank Cohen, delivers a practical Four-Pillar Governance Framework—Transparency, Accountability, Fairness, and Explainability—to help you govern AI-driven claim auditing with confidence. Learn how to identify and mitigate bias, implement robust human oversight, and document defensible AI review processes that regulators and auditors will accept. Discover concrete remedies, from rotation protocols to uncertainty scoring, and actionable steps to evaluate vendors before contracts are signed. In a regulatory landscape that moves faster than ever, gain the tools to stay compliant, defend your processes, and reduce liability while maintaining operational effectiveness.

January 13, 2026

Trending News

Happy National Doctor’s Day! Learn how to get a complimentary webcast on ‘Decoding Social Admissions’ as a token of our heartfelt appreciation! Click here to learn more →

CYBER WEEK IS HERE! Don’t miss your chance to get 20% off now until Dec. 1 with code CYBER25

CYBER WEEK IS HERE! Don’t miss your chance to get 20% off now until Dec. 2 with code CYBER24