Practice Management Blog

Medicare Billing Guidelines For Physical Therapists in Australia

Physiotherapists in Australia provide vital treatment and interventions for a range of chronic conditions, so it’s no surprise that physio practices are amongst the top allied health professional Medicare claimants with over 2.5 million claims every year.

Medicare in Australia makes it possible for clients with chronic (ongoing) conditions to access funding for physiotherapy services. This is great news for physiotherapists as it means you can help more people, and still receive remuneration for your work.

With hundreds of physiotherapists throughout Australia using our practice management software, we’ve witnessed first-hand how Medicare works for physiotherapy claims. We’ve distilled the most important learnings about Medicare billing guidelines for physical therapy to make it easier to access the benefits for your clients by answering the five most asked questions.

Looking for Medicare billing guidelines for the US? We’ve got you covered.

Who is eligible to claim Medicare benefits?

Medicare rebates are available for physiotherapy, but they can only be accessed under the CDM (Chronic Disease Management) Program. In order for a client to access these benefits, they will need to:

1. Have a chronic condition

This refers to a condition that they have suffered from for more than six months. According to the CDM:

A chronic medical condition is one that has been (or is likely to be) present for six months or longer, for example, asthma, cancer, cardiovascular disease, diabetes, musculoskeletal conditions, and stroke. There is no list of eligible conditions. However, the CDM items are designed for patients who require a structured approach and to enable GPs to plan and coordinate the care of patients with complex conditions requiring ongoing care from a multidisciplinary team.
Patients have complex care needs if they need ongoing care from a multidisciplinary team consisting of their GP and at least two other health or care providers.

Physiotherapy forms an important part of treatment for a number of chronic conditions including neck and back pain, osteoarthritis, rotator cuff tears, bursitis, tendon pain, tennis elbow, and other musculoskeletal conditions.

2. Have a valid referral from a general practitioner or medical specialist

The client will also need to have the right referral form from their GP, who needs to have specified your physiotherapy clinic for treatment.

How many visits does the Medicare CDM Program Rebate Cover?

The Medicare Chronic Disease Management Plan allows for a maximum of 5 rebated appointments per year to any allied health practitioner who has been referred. The covers all allied health services, including physiotherapy as well as occupational therapy, dietetics, podiatry, and others.

This might mean that a doctor refers a client to you for three physiotherapy consults, and the remaining two consults are allocated to an occupational therapist.

The five visits are renewed each calendar year, but a new referral is needed at the start of the period.

Should you offer billing or patient claims?

As part of the Medicare billing guidelines for physical therapy, you can choose whether you want to process bulk bill claims or patient claims. 86% of all Medicare claims are bulk billed, but for allied health providers (such as physiotherapists), the percentage is a lot lower at around 65%.

Bulk Billing

Bulk billing is where Medicare pays you directly, not the client. In other words, the client assigns their right to claim a Medicare benefit to your practice. This billing method means that the client doesn’t pay anything, and you receive payment from Medicare once you have submitted your claim to them (on behalf of your client). The most important restriction with this method (and the reason many physiotherapists choose not to offer bulk billing) is that all bulk bill claims have a rate cap meaning that you can only charge the amount allocated by Medicare Australia. You cannot charge a ‘gap’ fee. A physiotherapy session for a chronic condition (Chronic Disease Management) will be paid out at $53.80.

Patient Claims

A patient claim is when the client or a claimant (a parent or guardian) pays your practice for the full amount of the physiotherapy service. You then lodge a Medicare claim on their behalf. If Medicare accepts the claim, the designated amount is paid directly to the client or claimant. This option allows for a ‘gap’ fee for which the client is liable, and you can choose what you charge for your services because there is no rate cap. You may choose to charge $100 for your services; your client will pay you $100 and then receive their Medicare rebate back of $53.80.

This is the route that most physiotherapy practices opt for, following this simple 3-step process:

  1. The client settles your invoice in full after the session using a debit card.
  2. You swipe their Medicare card and access the rebate on behalf of the client.
  3. You swipe their debit card again, and the Medicare rebate is immediately put back on the client’s card.

Whether you offer bulk billing or patient claims, the process is a lot easier with Power Diary’s Medicare integration.

How can physiotherapists claim Medicare benefits?

You have three main options for processing Medicare claims:

  • Medicare Online – this service allows your practice management software (such as Power Diary) to connect directly and process Medicare claims. Learn how to process Medicare claims through Power Diary here.
  • Easyclaim – here you can process Medicare claims via a physical terminal in your practice. Physical terminals are offered by HICAPS, CBA, ANZ, and Tyro. Most allow for customer card payments, but there may be some limitations. Your terminal may also integrate with some practice management systems (read about Tyro’s integration with Power Diary here).
  • PRODA – Provider Digital Access (PRODA) is online identity verification and authentication system that allows you to access government online services. This is Medicare’s online web portal, where providers can submit and manage their claims. It’s free for physiotherapists to use, but it’s limited as it does not integrate with any practice management software systems, nor will it process your clients’ payment cards. Many of our clients have found this process to be difficult to navigate both in terms of filing claims and reconciling payments.

What about Medicare billing guidelines for physical therapy for Telehealth services?

With the recent rapid growth of Telehealth services offered by allied health providers such as physiotherapists, billing, and claims for health services are still playing catch-up. It can be difficult to find a good solution that allows your client to pay for and claim back Telehealth service fees. These are the most common options:

Bulk Billing

If you offer bulk billing, but your practice management software is not set up for telehealth service payments, you can process the bulk bill claim as you normally would via your software. You will then take the Medicare card details over the phone or during the consult.

Patient Claims

Patient claims put the client at a disadvantage with telehealth services as the payment is processed during the consult when they provide their credit card details over the call. You then email them the invoice which they can use to claim back from Medicare. The other option is to email them an invoice that they can pay via direct transfer.

Power Diary’s Solution

Power Diary is the ideal solution for claiming telehealth services as it is fully online, bypassing the need for hardware and terminals. Clients do not have to submit manual claims using an invoice that you provide (saving them time), and it’s easy for you to monitor payments and rebates securely (offering you peace of mind along with a cost and time saving).

Power Diary supports Medicare codes for telehealth services, including the temporary Covid-19 items. This makes it easy to use the practice management software to support your practice’s billing even if you provide remote services. To learn more about the codes for allied health providers, the full list is available here.

When will I receive payment?

If you submit a claim to Medicare during business hours, you can expect to have the claim approved in real-time. In some cases, Medicare may need to review or request clarification from the client or provider and this can delay the payment. Once the issue has been resolved and approved by Medicare, you can expect to receive the benefit payment by the next business day.

Successful bulk billing claims made by 9 pm Canberra time (GMT+10) on a business day will be issued the following business day. If claims are made on a weekend or public holiday, they will be processed the next business day.

If you don’t offer bulk billing and instead opt for patient claims, you will be paid by the client immediately. The client will usually receive their benefit payment from Medicare the same day.

The most important learnings in terms of Medicare billing guidelines for physical therapy practices in Australia are:

  • Your clients can access Medicare benefits if they have a chronic condition and a referral from a GP;
  • You can bill for a maximum of 5 consults per calendar year;
  • You will need to choose whether you offer bulk billing or patient claims (or a mix of the two);
  • The easiest way to claim benefits from Medicare is to use practice management software (whether you offer in-person or Telehealth appointments);
  • Payment from Medicare is settled promptly (in most cases it is immediate).

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