Medicare Progress Note Requirements and Compliance Guide

Medicare’s requirements for documentation are often confusing to rehabilitation therapists and none more so than Progress Reports. In this guide, we are going to clarify what needs to be included in this document and why Medicare deems it necessary. We will also touch on what may happen if you don’t comply. …

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A key to compliance: Medicare's Progress Note Requirements

Medicare’s requirements for documentation are often confusing to rehabilitation therapists and none more so than Progress Reports. In this guide, we are going to clarify what needs to be included in this document and why Medicare deems it necessary. We will also touch on what may happen if you don’t comply.

Justifying Care: why do progress notes exist?

Let’s start with the reasoning behind this documents. From Medicare’s perspective, the primary purpose of all Part B documentation is to demonstrate that the care fully supports the medical necessity of the services provided. That means a Progress Report must clearly describe how the services are medically necessary for that patient. Your daily treatment notes are valuable for justifying your billing but these more periodic reports are the justification for continuing services because they demonstrate your care meets the requirement of being medically necessary.

What is Medical Necessity?

Just to review, Medicare’s definition of medical necessity comes in two parts. First, according to the LCD for the Medicare Administrative Contractor, National Government Services (NGS, 2019) for those patients receiving rehabilitative therapy:

              “…the patient’s condition has the potential to improve or is improving in response to therapy, maximum improvement is yet to be attained; and there is an expectation that the anticipated improvement is attainable in a reasonable and generally predictable period of time.”


“Improvement is evidenced by successive objective measurements whenever possible. If an individual’s expected rehabilitation potential is insignificant in relation to the extent and duration of therapy services required to achieve such potential, rehabilitative therapy is not reasonable and necessary.”

In terms of rehabilitative therapy the terms improvement, expectation, reasonable and predictable period of time are all critical to understanding Medicare’s perspective. CMS says, when providing rehabilitative services, your patient must be able to improve and the improvement should happen in a reasonably, predictive time frame.

The second part relates to maintenance therapy which, to be clear, is now allowed. The criteria for meeting medical necessity for patients receiving maintenance therapy is:

“In the case of maintenance therapy, treatment by the therapist is necessary to maintain, prevent or slow further deterioration of the patient’s functional status and the services cannot be safely carried out by the beneficiary him or herself, a family member, another caregiver or unskilled personnel.”

In this scenario, your justification for meeting medical necessity must show that the patient needs to your skilled care, as a PT or OT, to prevent a decline in functional status. Again the Progress Report is where this happens best.

Writing Progress Reports

Progress Reports need to be written by a PT/OT at least once every 10 treatment visits. PTA/OTA’s cannot write progress notes. It’s also important to remember the time involved in writing a progress report cannot be billed separately. Like all documentation, Medicare considers it included in the payment for the treatment time charge.

Progress Reports do not need to be a separate document from a daily treatment note. As long as the treatment note contains all the elements (listed below) of a Progress Report, Medicare will consider you to be in compliance with their requirements. With that said, having a separate document makes it much easier to track the 10 visits and comply from a timing perspective. After all who needs to be counting visits by hand to remain compliant?

Minimum Elements

The following are the minimum required elements for a Progress Report and you must have all in your note or it cannot be considered a Progress note.

  Beginning and end dates of the reporting period of this report;

  Date the report was written;

  Objective reports of the patient’s subjective statements;

  Objective measurements (impairment/function testing) to quantify and demonstrate progress;

  Description of changes in status relative to each goal currently being addressed;

  Assessment of improvement, extent of progress (or lack thereof) toward each goal;

  Plans for continuing treatment including any changes to the treatment plan as appropriate;

  Changes to goals, discharge or an updated plan of care that was sent to the physician/NPP;

  Signature of the clinician with credentials.

There is no particular format required by Medicare as long as all the above is contained in the note as long as it happens at least once every 10 treatment visits. When co-treating a patient with a PTA or OTA the PT or OT must personally provide one full billable service on one date of service (DOS) within that progress note period. The PT/OT’s signature on the note for that DOS verifies your compliance with this rule.

What happens if I skip progress notes or otherwise fail to comply?

Failing to comply can have some significant consequences, which is why you need to make sure that you’re doing your progress notes. It’s key to have systems in place – MWTherapy’s EMR can help you stay compliant. If your Medicare Administrative Contractor were to decide to do a chart audit on your practice they would request some number of records for your Medicare patients. If, in the course of the audit, they find you do not have the correct Progress Reports included in the chart they can deem your care for that patient as not being medically necessary. Any care that does not meet the medical necessity requirement is considered unnecessary and Medicare can, and most likely will, determine they overpaid you. They will ask for their money back, usually with penalties and interest as well. It may also open the door for a more extensive audit of your charts which you really don’t want.

It is far better to be very familiar with these requirements and be sure your systems and processes are set up to make compliance as easy as possible. It will make your life substantially easier.

The bottom line

Keep this guide handy to stay on track with Medicare’s progress note requirement. With a little bit of planning, you’ll be able to comply with Medicare’s progress note requirement and keep your charts compliant and on track. MWTherapy has built-in compliance tools to help keep you on track and to remind you to get your progress notes done.

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