The October 2009 Medicaid Bulletin contains two items of significance to occupational therapy providers of outpatient specialized therapy to Medicaid recipients.

  These include reinstatement of a prior authorization (PA) requirement and the reimbursement rate reductions for all providers.
Prior Authorization
 Prior authorization will apply to all services except those provided by Local Education Agencies (LEAs) and services to dually eligible (Medicare/Medicaid) recipients where Medicare is the primary payer.  The Implementation schedule is:

• Services to recipients under the age of 21-PA goes into effect 12/1/09
• Services to recipients age 21 and older-PA goes into effect 1/1/10

The Division of Medicaid is currently selecting a vendor to manage the prior authorization process.
Reimbursement Rate Reductions
As part of the spending cuts passed by the legislature to balance the state budget, all Medicaid providers will be affected by a reduction in reimbursement rates.  Occupational therapy services, along with services provided by most physician and non-physician providers, will be cut 4.9% for the fiscal year that began July 1.  The cuts will be implemented beginning October 1, 2009 but will be annualized over the remaining nine months of the fiscal year. 
These new measures will impact both providers and service recipients.  However, in June most of the outpatient speicialized therapy service benefit was slated to be eliminated as part of budget reductions.  NCOTA was able to advocate successfully to retain the therapy benefit.  The prior authorization requirement and rate reductions are being applied to all or most Medicaid services in order to reduce costs, monitor utilization and ensure that services are medically necessary.  NCOTA continues to monitor proposals associated with the therapy benefit. 
To view the October Medicaid Bulletin online, go to:  http://www.ncdhhs.gov/dma/bulletin/1009bulletin.htm#ost