| Thu, Feb 14, 2013 @ 09:00 AM

Medicare Coverage for Outpatient Rehabilitation Therapy

Posted by Medicare Made Clear

Medicare Coverage for Outpatient Rehabilitation TherapyMedicare Part B covers outpatient occupational therapy (OT), physical therapy (PT) and speech-language pathology (SLP) services. These are rehabilitation therapy services that may help individuals regain or improve their ability to perform certain functions.

Outpatient rehabilitation services must be:

  • Provided by a skilled professional
  • Referred by a doctor who certifies that the therapy is medically necessary
  • Appropriate and effective in treating the condition
  • Reasonable in terms of frequency and duration

Therapy Caps

Medicare limits how much outpatient therapy it will help pay for in a calendar year. The limits, called “therapy caps,” are $1,900 for OT and another $1,900 for PT and SLP combined.

The Part B deductible ($147 in 2013) must be satisfied before Medicare starts to help with the cost of outpatient therapy. After that, Medicare will pay 80% of the cost up to the point where the amount the patient and Medicare together have paid reaches the cap.

Medicare does not cover outpatient therapy services that maintain a level of functioning or serve as a general exercise program. The therapy must contribute to improvements in the ability to perform daily activities. The therapist and the referring doctor evaluate progress. If improvement slows down too much or stops, then Medicare stops paying its share of the cost. You can continue the therapy, but you would have to pay the full cost yourself.

The therapy caps apply to services received in the following settings:

  • Therapist or physician offices
  • Outpatient rehabilitation facilities
  • Outpatient hospital departments
  • Skilled nursing facilities (nursing homes)
  • Home, when not part of a Medicare-covered home health benefit

There Are Exceptions

You may qualify for an exception to the therapy cap limits so that Medicare will continue to pay its share for your therapy services. Your therapist must document that the services you need are medically necessary. Medicare may review your medical record, even after your therapy is over and paid for. If the services you received above the therapy cap limits were not medically necessary, you might have to pay the total cost over the cap.

Medicare is most likely to cover additional therapy in complicated cases. In some cases, your doctor may have to get pre-approval from Medicare to continue your therapy. If Medicare denies a claim for services provided above the therapy cap, you can appeal through the regular Original Medicare appeals process.

Some Medicare Advantage plans apply the therapy caps and some don’t. Check with your specific plan to find out for sure. In addition, therapy received in outpatient hospital settings at particular times in 2012 may be exempt from the caps.

For more information, contact the Medicare helpline 24 hours a day, seven days a week at 1-800-MEDICARE (1-800-633-4227), TTY 1-877-486-2048. If you have questions about Medicare Made Clear, call 1-877-619-5582, TTY 711, 8 a.m. – 8 p.m. local time, seven days a week.


Medicare.gov: Visit the official U.S. government site for Medicare.

Part B Coverage: Learn what Part B covers on Medicare Made Clear.

APTA.org: Learn more from the American Physical Therapy Association site.

Y0066_130114_153542 CMS Accepted