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Modifier CO is a HCPCS Level II payment modifier used to identify outpatient occupational therapy services furnished in whole or in part by an Occupational Therapy Assistant (OTA).

The modifier was established under the Bipartisan Budget Act of 2018. Effective January 1, 2020, CMS required reporting of Modifier CO when applicable, and effective January 1, 2022, qualifying services furnished in whole or in part by an OTA became subject to the Medicare payment adjustment established by law.

Modifier CO does not replace Modifier GO. Modifier GO identifies that the service was furnished under an occupational therapy plan of care, while CO identifies that an OTA furnished all or part of that service.

Modifier

CO

Modifier Name

Outpatient Occupational Therapy Services Furnished in Whole or in Part by an Occupational Therapy Assistant (OTA)

Plain English Explanation

Modifier CO tells Medicare:

“This occupational therapy service was furnished entirely or partially by an Occupational Therapy Assistant (OTA).”

The modifier allows Medicare to apply the appropriate payment policy for OTA services.

Purpose of Modifier CO

Modifier CO is used to:

  • Identify services furnished by an Occupational Therapy Assistant.
  • Apply Medicare’s OTA payment adjustment.
  • Distinguish services furnished by an Occupational Therapist (OT) from those furnished in whole or in part by an OTA.
  • Ensure compliance with CMS outpatient rehabilitation billing rules.
  • Support accurate reimbursement.

Understanding Modifier CO

An Occupational Therapy Assistant (OTA) works under the supervision requirements established by Medicare, state law, and employer policies.

Modifier CO applies when:

  • The OTA furnishes the entire service, or
  • The OTA independently furnishes more than 10% of a service or unit of service (the Medicare de minimis standard).

The de minimis calculation applies to both timed and untimed services according to CMS rules.

When to Use Modifier CO

Append Modifier CO when:

  • The service is furnished under an occupational therapy plan of care.
  • An OTA performs the entire service.
  • An OTA independently furnishes more than 10% of a service or unit.
  • Medicare or another payer requires OTA reporting.

Modifier CO is reported together with Modifier GO on applicable Medicare claims. Claims missing the required GO/CO combination may be returned as unprocessable.

Common CPT codes include:

CPT CodeDescription
97165OT evaluation – low complexity
97166OT evaluation – moderate complexity
97167OT evaluation – high complexity
97168OT re-evaluation
97110Therapeutic exercises
97112Neuromuscular reeducation
97530Therapeutic activities
97535Self-care/Home management training

When NOT to Use Modifier CO

Do not use Modifier CO when:

  • The Occupational Therapist performs the service entirely.
  • OTA participation does not exceed the Medicare de minimis threshold.
  • The service is physical therapy (use CQ, when applicable).
  • The service is speech-language pathology.
  • The service is unrelated to an occupational therapy plan of care.

Medicare Rules

Under Medicare:

  • Modifier CO must be reported when applicable for outpatient occupational therapy services furnished in whole or in part by an OTA.
  • CO must be paired with Modifier GO.
  • The modifier applies when the OTA independently furnishes more than 10% of a service or unit.
  • Applicable services receive the OTA payment adjustment under the Medicare Physician Fee Schedule.

Commercial Insurance Rules

Commercial payer policies vary.

Some commercial insurers:

  • Require Modifier CO.
  • Follow Medicare therapy assistant rules.
  • Do not apply Medicare’s payment adjustment.
  • Use payer-specific documentation requirements.

Always verify payer-specific billing policies before claim submission.

Documentation Requirements

Documentation should include:

  • Certified occupational therapy plan of care.
  • Initial occupational therapy evaluation.
  • Daily treatment notes.
  • Progress reports.
  • Minutes furnished separately by the OT and OTA.
  • Documentation supporting application (or non-application) of the de minimis standard.
  • Therapist and OTA signatures, when required.

Real Billing Examples

Example 1 – Entire Service by OTA

An OTA independently performs 30 minutes of therapeutic activities under an occupational therapy plan of care.

Billing

  • CPT 97530
  • Modifiers GO CO

Example 2 – Shared Treatment

An Occupational Therapist performs 12 minutes of therapeutic exercise and the OTA independently performs 18 minutes.

Because the OTA furnished more than 10% of the service, the applicable unit(s) require Modifier CO under Medicare’s de minimis policy.

Example 3 – Self-Care Training

An OTA provides self-care and home management training.

Billing

  • CPT 97535
  • Modifiers GO CO

Example 4 – Neuromuscular Reeducation

An OTA performs neuromuscular reeducation to improve upper-extremity coordination.

Billing

  • CPT 97112
  • Modifiers GO CO

Example 5 – Incorrect Use

An Occupational Therapist performs the entire treatment session without any OTA involvement.

Billing

  • CPT 97530
  • Modifier CO

This is incorrect because no portion of the service was furnished by an OTA.

CMS-1500 Claim Example

FieldExample
CPT97535
Modifier 1GO
Modifier 2CO
Diagnosis PointerS62.101D (Example)
Units2

Common Denial Reasons

  • Missing Modifier CO.
  • Missing Modifier GO.
  • Incorrect modifier combination.
  • OTA involvement not documented.
  • Incorrect application of the de minimis standard.
  • Documentation inconsistent with billed services.
  • Invalid provider type.

How to Correct the Denial

  1. Review OT and OTA documentation.
  2. Verify the minutes performed by each provider.
  3. Apply the de minimis standard correctly.
  4. Ensure GO and CO are reported together when required.
  5. Submit a corrected claim.
  6. Appeal with supporting documentation if appropriate.

Coding Tips

  • Always report GO with CO on applicable Medicare claims.
  • Document OT and OTA treatment minutes separately.
  • Understand the Medicare de minimis calculation.
  • Verify payer-specific requirements for commercial insurance.
  • Maintain detailed documentation supporting skilled occupational therapy.

Modifier CO vs Modifier GO

ModifierDescription
COIndicates an OTA furnished all or part of the service
GOIndicates the service was furnished under an occupational therapy plan of care

Modifier CO vs Modifier CQ

ModifierDescription
COOccupational Therapy Assistant (OTA)
CQPhysical Therapist Assistant (PTA)

Modifier CO vs Modifier GP

ModifierDescription
COOTA services
GPPhysical therapy plan of care

Modifier CO vs Modifier GN

ModifierDescription
COOccupational therapy assistant services
GNSpeech-language pathology plan of care

Frequently Asked Questions (FAQs)

Q1. What does Modifier CO mean?

Answer: It identifies outpatient occupational therapy services furnished in whole or in part by an Occupational Therapy Assistant (OTA).

Q2. Is Modifier CO always billed with GO?

Answer: Yes. For applicable Medicare occupational therapy claims, Modifier CO is reported with Modifier GO because GO identifies the occupational therapy plan of care while CO identifies OTA involvement.

Q3. What is the Medicare de minimis rule?

Answer: Generally, Modifier CO applies when the OTA independently furnishes more than 10% of a service or unit of service.

Q4. Does Modifier CO apply to physical therapy?

Answer: No. Physical Therapist Assistant (PTA) services require Modifier CQ.

Q5. Does Modifier CO affect Medicare payment?

Answer: Yes. Applicable Medicare Part B occupational therapy services furnished in whole or in part by an OTA are subject to the statutory payment adjustment.

AR Caller Tips

When following up on claims billed with Modifier CO:

  • Verify that GO and CO were reported together.
  • Confirm OTA participation is documented.
  • Review OT and OTA treatment minutes.
  • Verify whether the payer follows Medicare OTA payment rules.
  • Record the payer representative’s name, reference number, and appeal instructions.

Interview Questions

Question 1

What does Modifier CO indicate?

Answer: It identifies outpatient occupational therapy services furnished in whole or in part by an Occupational Therapy Assistant (OTA).

Question 2

Which modifier must accompany CO on Medicare OT claims?

Answer: Modifier GO.

Question 3

What is the Medicare de minimis threshold?

Answer: The modifier generally applies when the OTA independently furnishes more than 10% of a service or unit of service.

Question 4

Does CO apply to physical therapy services?

Answer: No. Physical therapy assistant services require Modifier CQ.

Practice Scenario

Scenario

A Medicare beneficiary receives 30 minutes of self-care and home management training. The Occupational Therapist provides 10 minutes, and the Occupational Therapy Assistant independently provides 20 minutes.

Question

Which modifiers should be appended?

Answer

Report CPT 97535 with Modifiers GO and CO, because the service was furnished under an occupational therapy plan of care and the OTA independently furnished more than the Medicare de minimis portion of the service.

Related Therapy Modifiers

  • GO – Services Delivered Under an Outpatient Occupational Therapy Plan of Care
  • GP – Services Delivered Under an Outpatient Physical Therapy Plan of Care
  • GN – Services Delivered Under an Outpatient Speech-Language Pathology Plan of Care
  • CQ – Services Furnished in Whole or in Part by a Physical Therapist Assistant (PTA)
  • KX – Requirements Specified in the Medical Policy Have Been Met (when applicable)

Common Billing Mistakes

  • Reporting CO without GO.
  • Applying CO when the OTA did not exceed the de minimis threshold.
  • Using CO for physical therapy services.
  • Failing to document OT and OTA treatment minutes separately.
  • Incorrectly calculating timed units.
  • Omitting CO when required.

Key Takeaways

  • Modifier CO identifies outpatient occupational therapy services furnished in whole or in part by an Occupational Therapy Assistant (OTA).
  • It must be paired with Modifier GO on applicable Medicare claims.
  • Medicare generally applies CO when the OTA independently furnishes more than 10% of a service or unit.
  • Accurate minute tracking and documentation are essential for compliant billing.
  • Proper use of Modifier CO helps reduce claim denials and supports accurate Medicare reimbursement.

References

  • CMS Medicare Claims Processing Manual, Chapter 5 – Part B Outpatient Rehabilitation Services.
  • CMS Therapy Services Billing Examples for CQ/CO Modifiers.
  • CMS Therapy Services MLN Educational Materials.
  • HCPCS Level II Code Book.
  • CPT® Professional Edition (American Medical Association).

Conclusion

Modifier CO is a critical Medicare payment modifier used to identify outpatient occupational therapy services furnished in whole or in part by an Occupational Therapy Assistant. Correct use requires understanding the de minimis standard, accurate documentation of therapist and assistant treatment time, and proper pairing with Modifier GO. Following current CMS guidance helps providers maintain compliance, reduce denials, and ensure accurate reimbursement for outpatient occupational therapy services.

Educational Disclaimer

This article was prepared with the assistance of artificial intelligence (AI) for educational and informational purposes. It is based on publicly available CMS guidance, Medicare outpatient rehabilitation billing policies, HCPCS Level II guidance, and general medical coding principles. It is not an official publication of CMS or the American Medical Association (AMA). Always consult the latest CMS Medicare Claims Processing Manual, Medicare Benefit Policy Manual, the HCPCS Level II Code Book, applicable Local Coverage Determinations (LCDs), National Coverage Determinations (NCDs), and payer-specific billing policies before coding, billing, or submitting claims.