Dear APTA CO Member:
We want to share an important and time-sensitive update regarding Medicaid reimbursement for outpatient physical therapy services.
As many of you are now seeing, reimbursement rates for outpatient physical therapy were reduced effective April 1, 2026. We know this is both unexpected and frustrating. We believed these changes in rates would not happen until July 1.
These reductions stem from an Executive Order issued by the Governor in October, which authorized mid-year budget-balancing actions across Medicaid. You can find the executive order here. This included rebalancing Medicaid provider rates to 85% to Medicare. It is unprecedented for rate reductions to happen through executive order. Many other provider groups experienced reductions in late 2025, but many rates had to be approved by the federal government. Those provider groups, including outpatient physical therapy, were included in the April 1 implementation.
Providers were not given clear or direct notice from the Department of Health Care Policy & Financing (HCPF) that these cuts would take effect on this timeline, and we recognize the real impact that lack of communication has on your practices and your patients. We share in your frustration, and we take seriously our responsibility to keep you informed and advocate on your behalf.
Please know that we have been actively engaged on this issue and will continue to be. We are having direct conversations with HCPF to seek clarity and improve communication with providers. We have also worked with legislators and the Joint Budget Committee to ensure they realize the real impacts cuts to Medicaid have on providers, your businesses, your patients, and the critical role physical therapy plays in the health care system.
The new rate schedule is particularly hard to find on HCPF’s website, but we have linked to their spreadsheet here, so you do not need to search for it yourself. To find the new April 1 rates, you need to scroll to the right and look for the column titled “Total Allowable Amount 04-01-2026 Rates”. This spreadsheet contains the new rates for all providers. Please reach out if you need any assistance.
The legislature is currently debating budget cuts for the next fiscal year, totaling over $1.5 billion. This budget package includes a continuation of the lowered rates. Given the catastrophic fiscal situation in the state, we believe these rates will unfortunately continue. This is a great opportunity to reach out to your state legislators and advocate for our profession and the importance of adequate payment for services. Click here for an easy-to-use email template to contact your elected officials.
Sincerely,
Rebekah Griffith PT, DPT, NCS, FAAOMPT
President