8-Minute Rule for Medicare Billing

Medical items, equipment and medications can be easily counted for billing purposes. Be it one set of crutches or two millimeters of insulin, health care providers can track product usage and bill Medicare accordingly. 

But what about services? 

Medicare uses an “8-minute rule” to keep track of how much care was provided and how to bill and reimburse doctors and providers appropriately. 

What Is the 8-Minute Rule?

The 8-minute rule is Medicare’s way of dividing units of service. Each unit of service is a measurement of time.

• One unit applies to a health care appointment that lasts between 8 and 22 minutes.
• Each 15-minute interval thereafter counts as an additional unit of service.

For example, an appointment lasting between 23 and 37 minutes would be counted (and billed) as two units of service. 

The chart below shows the number of units that correspond to each appointment length. 

The name “8-minute rule” stems from the fact that appointments must last at least eight minutes to be billable to Medicare. If an appointment lasts for fewer than eight minutes, Medicare is not billed for the service. 

The 8-minute rule applies to time-based CPT (Current Procedural Terminology) codes. These codes are used to identify the types of services rendered. 

How Does the Medicare 8-Minute Rule Work?

Let’s say you visit a physical therapist and spend 17 minutes with the therapist assessing and discussing your condition. You then undergo an MRI, which takes 24 minutes. Next, you receive 33 minutes of physical therapy. Lastly, you spend six minutes asking your therapist some questions and further discussing your situation. 

The total amount of time you spent on all services was 80 minutes, so you therapist will bill Medicare for five units of service. 

The services received are not billed separately. They are all lumped together and billed as one service totaling five units of time. 

Which Insurance Types Follow the 8-Minute Rule?

The 8-minute rule is used by Medicare Part B, which provides coverage for outpatient services. Medicare Part A (inpatient benefits) does not use the 8-minute rule. 

But the 8-minute rule is not limited to just Medicare Part B. Medicaid, TRICARE and CHAMPUS (Civilian Health and Medical Program of the Uniformed Services) also use the 8-minute rule for billing purposes. 

Any insurance that follows Medicare billing guidelines will typically use the 8-minute rule, which can also apply to private insurance. 

8-Minute Rule vs. SPM

Another type of billing is SPM, or Substantial Portion Methodology.

Under SPM billing, units of service are also divided into 15-minute increments. However, each unit must last at least eight minutes to count as a new and separate unit. The eight-minute minimum is the “substantial portion” of the 15-minute interval. 

For example, a 47-minute appointment using the 8-minute rule would count as three units of service. But under SPM billing, it could count as four units. The first 38 minutes of the appointment counted as three units, and the final nine minutes of the appointment counted as a fourth unit because it was at least eight minutes long. 

Can Physical Therapists Bill Medicare Using the 8-Minute Rule?

Physical therapists bill Medicare using the 8-minute rule. Other types of therapists such as occupational therapists and speech therapists also commonly use the 8-minute rule for billing after treating a Medicare patient.  

Skilled nursing facilities, home health agencies and hospital outpatient departments also typically use the 8-minute rule for billing Medicare. 

Why Is It Important to Understand the 8-Minute Rule? 

By understanding the 8-minute rule, Medicare and other insurance beneficiaries can review their claims and ensure they are not being overcharged for services. Billing errors are common, and fraudulent or improper charges cost Medicare billions of dollars per year.

It’s always wise to review your medical claims and bills and knowing how the 8-minute rule works may protect you from being a victim.