Intensive Outpatient Program

Intensive Outpatient Program

Table of Contents

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Effective 1/1/2024, section 4124 of the CAA 2023 establishes Medicare coverage and payment for IOP services for individuals with mental health needs when furnished by hospital outpatient departments, CMHCs, RHCs and FQHCs.

An IOP is a distinct and organized outpatient program of psychiatric services provided for individuals who have an acute mental illness, which includes, but is not limited to conditions such as depression, schizophrenia, and SUDs. IOP services are not required to be provided in lieu of inpatient hospitalization.

IOP vs. Partial Hospitalization Program

An IOP furnishes treatment at a level more intense than outpatient day treatment or psychosocial rehabilitation, but less intense than a PHP. Programs providing primarily social, recreational, or diversionary activities are not considered intensive outpatient programs.

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Provider Types Eligible to Provide IOP

  • HOPD – TOB 12x, 13X, 85X
  • CMHC – TOB 76X
  • RHC – TOB 71X
  • FQHC – TOB 77X
  • OPD – TOB 087x (freestanding non-residential OTP); TOB 13X or 85X (hospital-based OTP); condition code 89 is used for provider-based OTP.

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Medicare Beneficiary Eligible for IOP Services

A Medicare beneficiary must have a mental disorder (including SUDs) which severely interferes with multiple areas of daily life, including social, vocational and/or educational functioning. In addition, IOP patients must be able to cognitively and emotionally participate in the active treatment process and be capable of tolerating the intensity of an IOP program. Patients meeting benefit category requirements for Medicare coverage of an IOP are those who need more intensive treatment than that provided by outpatient services, but who need less intensive treatment than that provided by a PHP. There must be evidence of the need for the acute, intense, structured combination of services provided by an IOP.

Patients admitted to an IOP do not require 24-hour per day supervision as provided in an inpatient setting, must have an adequate support system to sustain/maintain themselves outside the IOP, and must not be an imminent danger to themselves or others. Patients admitted to an IOP generally have an acute onset or decompensation of a covered Axis I mental disorder, as defined by the current edition of the Diagnostic and Statistical Manual published by the American Psychiatric Association or listed in Chapter 5, of the version of the ICD applicable to the service date, which severely interferes with multiple areas of daily life.

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Active Treatment and Treatment Plan

IOPs are structured to provide intensive psychiatric care through active treatment that utilizes a combination of the clinically recognized items and services described in Section 1861(ff) of the Social Security Act (the Act).

Patients admitted to an IOP must be under the care of a physician who certifies the need for intensive outpatient services, including the need for a minimum of nine hours per week of services, as evidenced by their plan of care (treatment plan). An IOP must incorporate an individualized treatment plan which describes a coordination of services wrapped around the particular needs of the patient and includes a multidisciplinary team approach to patient care under the direction of a physician. IOP reflects a high degree of structure and scheduling. The treatment goals must be measurable, functional, time-framed, directly related to the reason for admission to the program, and medically necessary.

Recertification must address the continuing serious nature of the patients’ psychiatric condition requiring active treatment in an IOP.

Discharge planning from an IOP may reflect the types of best practices recognized by professional and advocacy organizations that ensure coordination of needed services and follow-up care. These activities include linkages with community resources, supports, and providers in order to promote a patient’s return to a higher level of functioning in the least restrictive environment.

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Covered IOP Services

Services generally covered for the treatment of psychiatric patients (including patients with SUD) are:

  • Individual and group therapy with physicians, psychologists, or other mental health professionals (including SUD professionals) authorized by the state.
  • Occupational therapy services are covered if they require the skills of a qualified occupational therapist and are performed by or under the supervision of a qualified occupational therapist or by an occupational therapy assistant.
  • Services of social workers, trained psychiatric nurses, and other staff trained to work with psychiatric patients. These include principal illness navigation services provided by auxiliary staff, including peer support specialists.
  • Drugs and biologicals furnished to outpatients for therapeutic purposes, but only if they are of a type which cannot be self-administered.
  • Activity therapies but only those that are individualized and essential for the treatment of the patient's condition. The treatment plan must clearly justify the need for each particular therapy utilized and explain how it fits into the patient's treatment.
  • Family counseling services. Counseling services with members of the household are covered only where the primary purpose of such counseling is the treatment of the patient's condition. These include counseling services for caregivers.
  • Patient education programs, but only where the educational activities are closely related to the care and treatment of the patient. These services include caregiver training services furnished for the benefit of the patient.
  • Medically necessary diagnostic services related to mental health treatment.

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Noncovered Services

The following are generally not covered except as indicated:

  • Meals and transportation.
  • Activity therapies, group activities, or other services and programs which are primarily recreational or diversional in nature. Outpatient psychiatric day treatment programs that consist entirely of activity therapies are not covered.
  • "Geriatric day care" programs are available in both medical and nonmedical settings to provide social and recreational activities to older individuals who need some supervision during the day while other family members are away from home. Such programs are not covered since they are not considered reasonable and necessary for a diagnosed psychiatric disorder, nor do such programs routinely have physician involvement.
  • Psychosocial programs.
    • These are generally community support groups in nonmedical settings for chronically mentally ill persons for the purpose of social interaction. Outpatient programs may include some psychosocial components; and to the extent these components are not primarily for social or recreational purposes, they are covered. However, if an individual's outpatient hospital program consists entirely of psychosocial activities, it is not covered.
    • Programs comprised primarily of diversionary activity, social, or recreational therapy does not constitute an IOP. Psychosocial programs which provide only a structured environment, socialization, and/or vocational rehabilitation are not covered by Medicare.
  • Programs that only monitor the management of medication for patients whose psychiatric condition is otherwise stable are not covered by Medicare.
  • Vocational training. While occupational therapy may include vocational and prevocational assessment and training, when the services are related solely to specific employment opportunities, work skills or work settings, they are not covered by Medicare.

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Frequency and Duration of IOP Services

There are many factors that affect the outcome of treatment including the nature of the illness, prior history, the goals of treatment and the patient's response.

There are no specific limits on the length of time that services may be covered. As long as the evidence shows that the patient continues to show improvement in accordance with his/her individualized treatment plan and the frequency of services is within accepted norms of medical practice, coverage may be continued.

If a patient reaches a point in his/her treatment where further improvement does not appear to be indicated, evaluate the case in terms of the criteria to determine whether with continued treatment there is a reasonable expectation of improvement.

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Discharge from IOP

Patients in an IOP may be discharged by either stepping down to a less intensive level of outpatient care when the patient’s clinical condition improves or stabilizes and the patient no longer requires structured, intensive, multimodal treatment, or by stepping up to a more intensive level of care. This may include a PHP or an inpatient level of care (which would be required for patients who need 24-hour supervision).

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IOP Billing Basics

Claims for IOP services must include condition code 92.

FQHCs and RHCs must submit claims for IOP services using revenue code 0905 and Condition Code 92. FQHCs and RHCs should review CR 13264 for additional requirements.

Sequential Billing Requirement

Medicare requires claims for IOP services to be submitted in DOS order. Therefore, Medicare consistency edits ensure outpatient providers submit claims for a continuing course of treatment for a patient in DOS sequence. This means that the initial claim for services must be finalized before a claim for subsequent DOS are submitted. Claims submitted out of sequence will be RTP.

Sequential billing requires that the appropriate frequency digit (last digit in TOB) be submitted:

  • TOB XX1 = Admission though discharge claim
    • Examples: 0131; 0851; 0761
  • TOB XX2 = First in a series of claims
    • Examples: 0132, 0852, 0762
  • TOB XX3 = Claim for continuing course of treatment
    • Not admission or discharge claim
    • Examples: 0133, 0853, 0763
  • TOB XX4 = Last claim in a series/discharge claim
    • No additional IOP services are anticipated
    • Examples: 0134, 0854, 0764

Therefore, IOP claims must be submitted in DOS sequence for a continuing course of treatment:

  • If a patient completes their course of treatment in the same month, submit the claim with the TOB reflecting the admission through discharge (121 or 131, 851, or 761).
  • If the patient does not complete their course of treatment in the initial month, submit the claim with the TOB reflecting the first interim claim (122 or 132, 852, or 762).
  • If the patient does not complete their course of treatment in the subsequent month, submit the claim using the TOB for a continuing claim (123 or 133, 853, or 763).
    • Use the continuing claim TOB until the last month of treatment.
  • Submit the claim for the last (final) month of treatment with TOB 124 or 134, 854 or 764.

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Line-Item DOS Reporting

  • Hospitals (other than CAHs and CMHCs): Report LIDOS on each revenue code line in FL 45 “Service Date” in MMDDYY order. Each service provided must be repeated on a separate revenue code line along with the specific DOS for each occurrence.
  • CMHCs: Report the DOS per revenue code line for IOP claims spanning two or more dates. This means each service (revenue code) provided must be repeated on a separate line-item along with the specific date the service was provided for every occurrence. LIDOS are reported in FL 45 "Service Date" in MMDDYY order.

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Patient Discharge Status Codes

  • Report the patient status code 30 (still a patient) for IOP services billed on a TOB XX2 and XX3 (interim claims).
  • Otherwise, report the patient discharge status code that is appropriate for the discharge claim.

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Discharge Status Codes

Ensure that the patient discharge status code is billed correctly on the discharge claim.

Value Description
01 Discharged to home or self-care (routine discharge)
02 Discharged or transferred to a short-term general hospital for inpatient care
03 Discharged or transferred to SNF with Medicare certification in anticipation of skilled care
04 Discharged or transferred to a facility providing custodial or supportive care (ICF)
05 Discharged or transferred to another type of institution
06 Discharged or transferred to home under care of organized home health service organization
07 Left against medical advice or discontinued care
09 Discharged from outpatient care to be admitted to this same hospital which the patient received outpatient services
20 Expired (or did not recover – Christian Science Patient)
21 Discharged and transferred to court or law enforcement
30 Still a patient
41 Expired in a medical facility, i.e., hospital, SNF, ICF or freestanding hospice
43 Discharged or transferred to federal health care facility
50 Hospice – home
51 Hospice – medical facility providing hospice level of care
61 Discharged or transferred to a hospital-based Medicare approved swing bed
62 Discharged or transferred to IRF including rehabilitation distinct part units of a hospital
63 Discharged or transferred to a Medicare-certified LTCH
64 Discharged or transferred to a nursing facility certified under Medicaid but not certified under Medicare.
65 Discharged or transferred to a psychiatric hospital or psychiatric distinct part of a hospital (effective for discharges on or after 4/1/2004).
66 Discharged or transferred to a CAH

 

Note: Codes used for Medicare claims are available from the NUBC via the NUBC’s Official UB-04 Data Specifications Manual. Refer to the NUBC for coding updates.

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IOP FAQs

  1. Are IOP and PHP different names for the same program?

    Answer: No; effective 1/1/2024, Medicare covers IOP services for those with a psychiatric or substance use disorder.

    The level of treatment provided in an IOP is more intensive than outpatient day treatment or psychosocial rehabilitation, but less intensive than services rendered in a PHP.

    IOP closes the coverage gap for patients requiring more intensive services than traditional outpatient therapy provides yet less intensive than services provided in a PHP or inpatient psychiatric program.
     
  2. Please clarify the difference between the required number of "hours" versus "services" per day/week? For example, the regulation states a minimum of nine hours per week to meet the definition of IOP.

    Answer: The Medicare beneficiary receiving IOP services requires a minimum of nine hours of services per seven consecutive day span as evidenced by their plan of care.

    Medicare reimburses IOP services via APC. CMS designated that a level 1 APC applies when up to three services per day are rendered. A level 2 APC applies when four or more services are rendered per day.

    Starting in CY 2024 and subsequent years, the payment structure for Intensive Outpatient Program services provided in hospital outpatient departments and CMHCs has been set to four (4) separate APCs:
  • APC 5851 – IOP (up to three services per day) for CMHC IOPs
  • APC 5852 – IOP (four or more services per day) for CMHC IOPs
  • APC 5861 – IOP (up to three services per day) for hospital-based IOPs
  • APC 5862 – IOP (four or more services per day) for hospital-based IOPs
  1. I understand that one primary code should be rendered for each day of IOP. Please clarify which codes are considered “primary” for IOP services? In addition to billing a primary code, what additional codes can be billed for IOP services?

    Answer:
IOP primary CPT/HCPCS codes include:
90832 90834 90837 90845 90846 90847
90853 90880 96112 96116 96130 96132
96136 96138 G0410 G0411    
Additional IOP services:
90785 90791 90792 90832 90833 90834
90836 90837 90838 90839 90840 90845
90846 90847 90849 90853 90880 90899
96112 96116 96130 96131 96132 96133
96136 96137 96138 96139 96146 96156
96158 96161 96164 96167 96202 96203
97151 97152 97153 97154 97155 97156
97157 97158 97550 97551 97552 G0023
G0024 G0129 G0140 G0146 G0176 G0177
G0410 G0411 G0451      

 

Resources:

Reminder: For the most current information check the quarterly I/OCE, OPPS, FQHC, and RHC updates

  1. Medication management services by an MD or APRN are an integral component of IOP treatment. Do those services provided by the MD/APRN count toward the total of nine hours of IOP per week?

    Answer: The treatment plan must include all specific treatments ordered, including reference to any psychotropic medication management, the expected timeframes and outcomes for each treatment, and the discharge plan. In addition, the individual Plan of Care should reflect that a minimum of nine hours of IOP services per seven consecutive day span is planned.

    Whether such services “count” toward the minimum number of hours per seven consecutive day span depends upon what code is billed and whether the code is billed on the UB-04 versus the 1500 claim.
  • When a code is billed on a 1450 (UB-04) claim to Medicare Part A, the code may be considered for inclusion toward the number of hours of IOP services rendered per seven consecutive day span.
  • When a code is billed on the 1500 (professional) claim to Part B, the code is not considered for inclusion toward the number of hours of IOP services rendered per seven consecutive day span.
  1. Can IOP and PHP services be billed on the same date of service?

    Answer: IOP claims are billed with condition code 92 while PHP claims are billed with condition code 41. Condition code 92 and 41 cannot be billed on the same claim; thus, all services relevant to the psychiatric care plan are billed as either IOP or PHP, not both.

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Revised 4/19/2024