CPT modifiers are two-character codes appended to a procedure code to provide additional information about the service performed. These modifiers help payers understand the specific circumstances under which a medical service was provided without changing the core procedure code. For therapy services, modifiers signal important distinctions, such as whether the service focuses on regaining lost function or developing a new one. They also communicate which type of licensed provider delivered the treatment, which impacts claims processing and reimbursement.
Defining Modifier 97
Modifier 97 designates Rehabilitative Services. This service helps a patient restore, keep, or improve skills and functioning for daily living lost or impaired due to sickness, injury, or disability. Modifier 97 is paired with Modifier 96 (Habilitative Services) to distinguish between restoring a previous function (rehabilitative) and acquiring a new skill that was never developed (habilitative). Providers use this modifier for accurate tracking and coverage determination, particularly for plans complying with the Affordable Care Act’s essential health benefit requirements.
The billing requirement associated with therapy assistants is addressed by the HCPCS Level II modifiers CQ and CO. The Centers for Medicare & Medicaid Services (CMS) established these modifiers to identify services furnished by a Physical Therapist Assistant (PTA) or an Occupational Therapy Assistant (OTA), respectively. The CQ modifier signals that an outpatient physical therapy service was provided in whole or in part by a PTA. The CO modifier is used for outpatient occupational therapy services delivered in whole or in part by an OTA.
These assistant-specific modifiers satisfy a mandate from the Bipartisan Budget Act of 2018, requiring CMS to track and reduce payment for services performed by assistants. Modifier 97 defines the type of therapy (rehabilitative), while the CQ and CO modifiers define the person delivering the service. These assistant modifiers must be used with the discipline-specific modifiers: GP for physical therapy, GO for occupational therapy, and GN for speech-language pathology.
Specific Situations Requiring Application
The application of the CQ or CO modifier is triggered by the “de minimis standard,” a regulatory threshold. This standard determines when an assistant’s service qualifies as “in whole or in part” for billing. For timed services, the modifier must be applied to a 15-minute unit if the assistant independently furnishes three minutes or more of that service. This means the assistant must provide greater than 10% of the 15-minute increment for the modifier to be required.
The rule applies to skilled therapeutic services performed independently by the assistant, not to concurrent services where the licensed therapist is present. For untimed therapy services, such as group therapy, the assistant modifier is required if the assistant provides more than 10% of the total service time. The assistant must always work under the established, active plan of care created by the supervising licensed therapist.
The necessity of the assistant modifier is determined on a line-item basis for each CPT code within a patient’s session. If a patient receives two units of therapeutic exercise, and the assistant independently provides the minutes for one unit, only that specific line item carries the CQ or CO modifier. This application ensures that only the portion of the service delivered by the assistant is subject to the payment adjustment.
Billing and Documentation Requirements
The consequence of applying the CQ or CO modifier is a mandated reduction in reimbursement for the billed service. For Medicare Part B, services with the assistant modifier are paid at 85% of the applicable payment rate. This 15% payment reduction took effect on January 1, 2022, resulting directly from federal legislation. Since many private payers follow Medicare’s lead, this payment reduction model is common across the healthcare landscape.
Accurate documentation is mandatory to support the use of the assistant modifier on the claim. Clinicians must clearly record who provided the service, including the identity of the assistant and the supervising therapist. The patient’s medical record must reflect the minutes of service delivered by both the assistant and the therapist. This detail is necessary for compliance and to ensure appropriate financial processing for the services rendered.