Medicare Rules for Physical Therapy and Occupational Therapy

If you are like most Americans, there will come a time when you could benefit from physical, occupational, or speech therapy. Thankfully, Medicare offers these services for all enrollees. This article will address what is covered, how long you can receive services, and how much you can expect to pay.

Medicare physical therapy
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The Difference Between Physical and Occupational Therapy

Physical therapy and occupational therapy are often interchanged in lay speak. The truth is they are not the same. Physical therapy aims to treat or at least improve an impairment whereas occupational therapy teaches you how to function with that impairment. For example, physical therapy strengthens a shoulder injury but occupational therapy helps you to use the shoulder in everyday activities.

Speech therapy also falls under therapy services and can be especially helpful after a stroke.

Is Therapy Medically Necessary?

You cannot get therapy just because you want it. There must be a confirmed and documented medical reason for Medicare to pay for it. This means your healthcare provider must assign a proper diagnosis code that justifies their order for therapy.

If Medicare denies the request for therapy, it could be that the wrong diagnosis code was selected. You should contact your healthcare provider to see if another code can be used to add support for your need for services. Otherwise, you may need to appeal your case to Medicare.

Can You Get Therapy at Home?

Most people will drive to an office or facility to complete their therapy sessions but some people may not have the means to get out of the house. In these cases, home therapy may be covered by Medicare.

The first requirement is that you be homebound to receive home health services. According to Medicare, this means that you are unable to leave your home without help, leaving your home is too physically taxing or your medical condition is too serious to recommend you leaving the home. It is not simply a transportation issue.

The second requirement is that therapy be performed by a qualified professional who will "safely and effectively" establish a program that will improve or at least maintain your condition. Generally speaking, services are not intended to last forever but should span a reasonable period of time to achieve the intended goal.

People on Medicare Advantage plans (as opposed to Original Medicare) may have another option. As of 2019, some Medicare Advantage plans may be offering ride shares as a supplemental benefit. This could improve access to physical therapy and occupational therapy outside of the home for people who do not otherwise have the means to travel to their appointments.

How Much Therapy Can You Get?

Medicare does not cut you off after at a specific number of visits. It used to limit your physical therapy and occupational therapy sessions based on how much you spent on those services in a given year.

Depending on which therapists you use and if they accept assignment, you may be charged more or less per session. Shopping around for the lowest cost could increase how many sessions you could get covered. As with other Medicare-approved services, you will pay a 20% coinsurance for each session.

Until 2018, Medicare paid for these therapy services but limited how much it would pay for them. This was known as the therapy cap. In 2018, there was a $2,010 cap for physical therapy and speech therapy combined and a separate $2,010 cap for occupational therapy. However, later in 2018, Congress passed the Bipartisan Budget Act of 2018 and the therapy cap met its timely end. The legislation affected claims retroactively starting on January 1, 2018.

Understanding the Therapy Cap

Ending the therapy cap does not mean that you can get as much therapy as you want. The government wants to be sure that these services are medically necessary.

Once you have spent $2,010 on physical therapy and speech therapy combined or on occupational therapy alone in a calendar year, your therapist needs to add a billing code (known as the KX modifier) to your medical record as a flag to the government. Technically, the $2,010 amount is not a cap since it does not stop you from getting more therapy. It is instead seen as a "threshold" limit.

After you have spent $3,000 for physical therapy and speech therapy combined or $3,000 for occupational therapy, Medicare may audit your case to make sure continued sessions are medically necessary. Your therapist needs to explain why additional sessions are indicated and clearly document this in your medical record. Failure to properly document this information could lead to Medicare denying coverage for additional therapy that calendar year.

Summary

Physical therapy, occupational therapy, and speech therapy are covered by Medicare. There used to be a therapy cap on how much Medicare would pay but the cap was lifted in 2018. To be sure that services are not being overutilized, Medicare will audit cases after $3,000 is spent in a calendar year to make sure that continued therapy sessions are medically necessary.

A Word From Verywell

It is important you get the care you need. Physical and occupational therapy are common after surgery or after an injury. Speech therapy may be needed after a stroke. There are many other conditions that qualify. You can be reassured Medicare will cover these services as long as your therapist documents why and how often you need them.

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Article Sources
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  1. Thomas Kornfield et al. Medicare Advantage Plans Offering Expanded Supplemental Benefits: A Look at Availability and Enrollment. Commonwealth Fund. February 2021. doi:10.26099/345k-kc32

  2. Congress.gov. H.R.1892 - Bipartisan Budget Act of 2018. Updated February 9, 2018.

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