Medicare Rules for Physical Therapy and Occupational Therapy

Therapy at a Facility or in Your Own Home

Medicare physical therapy
Pamela Moore / E+ / Getty Images

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. In 2012, Medicaid covered the benefit in 39 states.

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 injury 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 or Medicaid to pay for it. This means your healthcare provider must assign a proper diagnosis code that justifies their order for therapy.

If Medicare or Medicaid denies the request for therapy, it could be that the wrong diagnosis code has been selected. You should contact your healthcare provider to see if another code can be used to add support for your case.

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 or Medicaid.

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.

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.

How Much Therapy Can You Get?

There is not a specific number of visits you are allowed. Instead, therapy sessions are limited by total cost. Depending on which therapists you use and if they accept assignment, you may be charged more or less. As with other Medicare-covered services, you will pay a 20 percent coinsurance for each session.

For 2016, Medicare allows $1,960 for physical therapy and speech therapy combined and a separate $1,960 for occupational therapy, a minor $40 increase in benefits from 2015. This is known as the therapy cap. The therapy cap did not apply to Maryland hospitals until 2016.

Understanding the Therapy Cap

Reaching the therapy cap does not mean that your therapy has to stop. You and your therapist can appeal for additional care. Your therapist must document in your chart and explain why additional sessions are medically necessary. There is no guarantee Medicare will agree with their recommendation.

You may be approved for additional therapy. However, after you have spent $3,700 for physical therapy and speech therapy combined or $3,700 for occupational therapy, Medicare will audit your case. This could potentially lead to denial of further care.

View Article Sources
  • Centers for Medicare and Medicaid Services. Therapy Services. redirect=/TherapyServices/. Revised February 16, 2016. 
  • The Henry J. Kaiser Family Foundation. Medicaid Benefits: Physical Therapy Services. 
  • Benefits.
  • Medicare Limits on Therapy Services. Revised January 2016.