The Affordable Care Act (ACA) requires coverage of certain essential health benefits (EHBs), two of which are rehabilitative and habilitative services and devices. Since the ACA did not define these terms or specify coverage requirements, it is left up to individual states to create benchmark plans to determine coverage requirements. As of January 1, 2018, there are two informational modifiers which should be used when reporting these two different types of services. Since physical therapy services may be either habilitative or rehabilitative, the appropriate modifier needs to be used when reporting these services.

What's the Difference?
Habilitative (modifier 96): services that help a person DEVELOP skills or functions they didn't have before.

Rehabilitative (modifier 97) services that help a person RESTORE functions which have become either impaired or lost.

Requirements may vary from payer to payer. Let's examine some key concepts excerpted from one payer's policy (emphasis added):

• There is the expectation that the therapy will assist development of normal function or maintain a normal level of function;
• An individual would either not be expected to develop the function or would be expected to permanently lose the function (not merely experience fluctuation in the function) without the habilitative service.
  

The above policy includes more descriptive requirements than the simplified description at the beginning of this article. As you can see, it is necessary to verify payer policies to ensure coverage requirements for medical necessity are met. Don't forget to also make sure that your documentation clearly identifies the type of service as well as payer requirements to ensure compliance in the case of an audit.