Minnesota Hospital Association

Policy & Advocacy

Physician Supervision Requirements for Outpatient Therapeutic Services

In the 2009 outpatient prospective payment system rule, the Centers for Medicare and Medicaid Services (CMS) mandated a policy for “direct supervision” of outpatient therapeutic services. CMS characterized the change as a “restatement and clarification” of existing policy in place since 2001 leaving hospitals (including critical access hospitals) at risk of retroactive enforcement.

Given the lack of clinical evidence that such a policy was needed, through the years the Minnesota Hospital Association along with the American Hospital Association and other groups have urged CMS to rescind or significantly modify this policy. As a result of this advocacy CMS has adopted several positive modifications.

Under the modifications, certain types of non-physician practitioners may provide “direct supervision,” including physician assistants, nurse practitioners, clinical nurse specialists, certified nurse midwives and licensed clinical social workers (according to state license, scope of practice and hospital-granted privileges). CMS also removed all reference to the physical boundaries, but the supervising professional must be “immediately available to furnish assistance and direction throughout the performance of the procedure.”

In total, CMS changed the supervision requirement for 43 outpatient services: 16 services require “direct supervision” only for the initiation of the service, followed by “general supervision” once the patient is medically stable. Twenty-seven other services have been modified to a “general supervision” requirement. CMS also extended the enforcement delay for hospitals with less than 100 beds through 2013, but that delay has now expired.

Even with some modifications, MHA is concerned that this policy may be difficult for some hospitals to implement. MHA supports H.R. 2801/S. 1143, the Protecting Access to Rural Therapy Services Act of 2013 (PARTS), legislation that would adopt a default standard of “general supervision” and develop a reasonable exceptions process with provider input to identify specific procedures that require “direct supervision.” 

Physician Supervision White Paper

MHA developed a tool for members seeking to better understand and adapt to Medicare’s new policy requiring direct supervision of outpatient therapeutic services delivered in a hospital. The whitepaper provides a detailed flow chart to help hospital staff walk through the various elements of the direct supervision standard to determine if it applies to a particular service and, if so, what kind of staffing is required by Medicare.  

Download the Direct Supervision of Outpatient Therapeutic Services Toolkit

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