The 8-minute rule: how to count PT units for Medicare and other plans

Medicare’s 8-minute rule says this: add up the minutes of all the timed codes in one visit, then bill one 15-minute unit for 8 to 22 minutes, two units for 23 to 37 minutes, and so on in 15-minute steps. The total minutes cap the total units. Within that cap, the codes that took the most time get the units. Commercial plans, Medicaid and Medicare Advantage plans can set their own rules, and some count each code on its own.

This guide covers the Medicare method from CMS’s own manual, worked examples, the assistant modifiers CQ and CO, the 2027 KX threshold, and what to check with other plans. Rules are as of November 2026.

What the rule applies to

Therapy codes come in two kinds.

• Untimed codes are billed once per day, whatever the minutes. CMS’s manual uses a speech-language evaluation as its example: one unit, regardless of time.
• Timed codes describe 15 minutes of direct, one-on-one time, and are billed in units. Therapeutic exercise (97110), neuromuscular re-education (97112), gait training (97116), manual therapy (97140) and therapeutic activities (97530) are timed codes.

The 8-minute rule only applies to timed codes. The source is the Medicare Claims Processing Manual, chapter 5, section 20.2.

The units table

These are the ranges CMS publishes. The pattern carries on past two hours.

Three rules sit on top of the table:

1. The total caps the units. Count the total timed minutes for the day, read the units from the table, and that is the most you can bill across all timed codes.
2. 15 minutes earns a unit. Any single timed code done for 15 minutes or more gets at least one unit, and one done for 30 minutes or more gets at least two.
3. Leftover minutes go to the biggest remainder. When the full units are assigned and one unit is left, it goes to the service with the most minutes left over. When several services each ran 7 minutes or less but add up to 8 or more, bill one unit for the one that took longest.

CMS also says the minutes before the eighth still count toward the total. The table is a rounding guide, not a reason to drop minutes.

Worked examples

These are CMS’s own examples from the manual, restated. The minutes are illustrative, not from a real patient.

Example 3 trips people up. The first 30 minutes of exercise make two full units. That leaves 3 minutes of exercise against 7 minutes of manual therapy, so the third unit goes to manual therapy.

Example 4 is the other common miss. Four services were done, but 49 minutes only supports three units, so the ultrasound is documented in the note and not billed.

What the note has to show

Medicare does not require minutes for each code in the treatment note. It does require two totals, under the Medicare Benefit Policy Manual, chapter 15, section 220.3:

• total timed code treatment minutes
• total treatment time, including untimed services

In practice, minutes by code make the unit split easy to defend, and many commercial plans ask for them. The billing side can only count what the note records, so the totals have to be in every daily note.

The same chapter sets the paperwork around the units:

• Plan of care certification. A physician or NPP certifies the plan, ideally within 30 days of the first treatment. A certification covers up to 90 calendar days.
• Recertification at least every 90 days, or sooner when the plan changes significantly.
• Progress reports at least once every 10 treatment days.

A unit counted perfectly is still denied if the plan behind it lapsed.

Assistants: the CQ and CO modifiers

When a physical therapist assistant or occupational therapy assistant furnishes a service in whole or in part, Medicare pays 85% of the fee schedule amount. The claim line carries CQ (PTA) or CO (OTA), next to the GP or GO therapy modifier. This comes from section 53107 of the Bipartisan Budget Act of 2018 and is explained on CMS’s therapy services page.

CMS’s de minimis rule decides when the modifier goes on:

• If the assistant’s independent minutes are 10% or less of the service, no modifier.
• If more than 10%, the modifier goes on.
• Last unit exception: when one 15-minute unit is left and the therapist alone furnished 8 or more minutes of it, that unit is billed without CQ or CO.
• Two-unit exception: when two units of the same service remain and the therapist and assistant each furnished 9 to 14 minutes (23 to 28 minutes together), one unit carries CQ or CO and the other does not.

CMS publishes billing examples for these cases on the same page. Keep a record of who furnished which minutes, because the split decides the payment.

The KX threshold for 2027

The old therapy cap is now a threshold. Once a patient’s yearly therapy spending passes it, each further claim needs the KX modifier, which says the care is medically necessary and the record shows why. Claims over the threshold without KX are denied.

The 2027 amounts are in the CY2027 Physician Fee Schedule final rule published November 9, 2026: CMS raised the 2026 amount by the Medicare Economic Index (MEI) and rounded to the nearest $10. The 2026 amounts are on the CMS therapy services page. The $3,000 review threshold stays at $3,000 for 2027, as of November 2026.

Two practical points:

• Medicare counts spending toward the threshold at the fee schedule rate, across every provider the patient sees that year. A new patient may arrive with part of the year’s amount already used.
• Passing $3,000 does not trigger review of every claim. CMS reviews selectively, using factors such as high denial rates or unusual billing patterns.

Telehealth through 2027

CMS’s therapy services page says the Consolidated Appropriations Act, 2026 extended the ability of PTs, OTs and speech-language pathologists to furnish telehealth services through December 31, 2027. Check the current list of covered telehealth codes before billing a remote visit, since the 8-minute rule still applies to the timed minutes.

Other plans: check before you count

Medicare’s method is not universal. Commercial plans, NY Medicaid and Medicare Advantage plans publish their own reimbursement policies for therapy, and the counting rule can differ:

• Some follow Medicare and pool the minutes across codes.
• Some count each timed code on its own, so a code needs its own 8 minutes to bill a unit. Two services of 7 minutes each would bill nothing under that method, where Medicare would allow one unit.
• Some ask for start and stop times, or minutes by code, in the note. Anthem, for example, introduced a timed-units policy in December 2024 that asked for start and stop times by code, then dropped that requirement for Anthem California in August 2025 after APTA’s objection.

Plans also set their own visit limits and authorization rules, which matter as much as the unit count. For each plan you see often, find its therapy reimbursement policy, note the counting method and the date of the version you read, and set your billing software to match.

Example (illustrative only): a visit has 20 minutes of therapeutic exercise and 20 minutes of manual therapy, 40 timed minutes in all. Medicare’s method allows three units, two of one code and one of the other. A plan that applies the same 8- and 23-minute marks to each code separately pays one unit of each, two in total, because neither code reached 23 minutes on its own. Same visit, one unit apart.

Common mistakes that cost units

• Rounding each code up on its own for a Medicare patient. That bills more units than the total minutes allow. CMS’s manual also flags practices that consistently bill units averaging under 15 minutes for review.
• Dropping a short service that should have won the leftover unit, as in example 3.
• Leaving total timed minutes out of the note. The units can’t be defended without it.
• Missing KX on claims after the threshold, which turns medically necessary care into a denial.
• Applying Medicare’s method to every payer. Per-code plans pay fewer units on the same visit.
• CQ or CO on the wrong lines, either missing (an overpayment risk) or added where the therapist furnished the minutes (an underpayment).

Sources

• Medicare Claims Processing Manual, chapter 5 (Part B outpatient rehabilitation), section 20.2
• Medicare Benefit Policy Manual, chapter 15, sections 220 and 230
• CMS: Therapy services (KX thresholds, CQ and CO modifiers, telehealth)
• CY2027 Medicare Physician Fee Schedule final rule, Federal Register, November 9, 2026
• APTA: Anthem changes payment policy on timed units (September 2025)

General information, not advice on a specific claim, contract or legal question. Rules and rates change; check the linked sources for the current version. CPT® is a registered trademark of the American Medical Association. Code descriptions here are paraphrased.