Medicare Withholding Tax:  Request for Information

For-profit health care entities, such as physical therapist private practices, physician practices, and hospitals, may be subject to a 3% withholding tax after December 31, 2011, if the entity receives a single payment of $10,000 or more from the government for services.  Certain payments are exempt from the withholding requirement, including Medicaid payments.  However, Medicare and Tricare payments that involve a single payment amount of greater than $10,000 are subject to the withholding.  Further clarification is needed regarding the $10,000 threshold determination.  Health care professional organizations are strongly advocating for an exemption for this requirement.

APTA is examining the potential impact of this provision on physical therapy and is seeking your assistance.   If your practice or facility ever receives aggregated payments of $10,000 or more from Medicare or Tricare, please send this information to nancywhite@... .  This information will help APTA determine possible action related to this matter.  Thank you for your help.