How Long Will Medicare Pay for Physical Therapy?

Medicare is a federal health insurance program for individuals aged 65 or older, certain younger people with disabilities, and those with End-Stage Renal Disease. Physical therapy is a common medical service designed to help individuals recover from injuries, manage chronic conditions, or regain physical function.

Medicare’s Criteria for Physical Therapy Coverage

Medicare covers physical therapy when it is medically necessary for treating an illness or injury, improving a condition, or restoring function. Services must be specific and complex enough that only a skilled therapist can provide them safely and effectively. This ensures that the therapy addresses a patient’s specific health needs and goals.

A physician’s order or certification is a fundamental requirement for Medicare coverage. This initial referral establishes the medical necessity for the therapy services. A qualified physical therapist then develops a comprehensive plan of care.

The plan of care details the patient’s diagnosis, long-term goals, and the specific type, frequency, and duration of therapy. A physician must certify this plan of care. Services must be provided by a licensed and Medicare-certified physical therapist, or by a physical therapist assistant under supervision.

Outpatient physical therapy services are covered in various settings, including a therapist’s private office, hospital outpatient departments, skilled nursing facilities (SNFs) on an outpatient basis, and through home health agencies. The setting does not alter the requirement for medical necessity and a certified plan of care.

Extending Physical Therapy Coverage Beyond Initial Thresholds

There is no fixed time limit for how long Medicare will cover medically necessary physical therapy services. However, specific thresholds require additional documentation to confirm ongoing medical necessity. In 2024, a threshold of $2,330 applies to combined physical therapy and speech-language pathology services.

This amount is not a cap on benefits but a point where providers must attest that services beyond this figure are medically necessary. To indicate this, providers append a “KX modifier” to claims exceeding this threshold. This modifier signifies the services are medically necessary and supported by documentation.

Services exceeding a higher threshold may be subject to a targeted medical review by Medicare contractors. In 2024, this higher threshold is $3,000 for combined physical therapy and speech-language pathology services. While not all claims above this amount are automatically reviewed, selected claims undergo scrutiny to ensure medical necessity.

The targeted medical review process focuses on providers with high denial rates or unusual billing patterns. As long as physical therapy remains medically necessary and documentation supports the ongoing need, Medicare will continue coverage.

Financial Responsibilities for Physical Therapy

Patients receiving outpatient physical therapy services generally incur financial responsibilities under Medicare Part B. Beneficiaries must meet the annual Part B deductible. In 2024, this deductible is $240. Medicare begins to pay its share of approved services only after the beneficiary has paid this amount out-of-pocket.

After the deductible is met, beneficiaries are typically responsible for a coinsurance amount. This usually involves paying 20% of the Medicare-approved cost for each physical therapy service. Medicare then covers the remaining 80% of the approved amount.

Beneficiaries should choose providers who “accept assignment.” This means the provider agrees to accept the Medicare-approved amount as full payment for services, limiting the patient’s out-of-pocket costs to the deductible and coinsurance. Providers who do not accept assignment may charge more than the Medicare-approved amount, leading to higher costs for the patient.

Physical therapy received during an inpatient hospital stay or in a skilled nursing facility may be covered differently. These services often fall under Medicare Part A, which has distinct cost-sharing rules, including a deductible per benefit period and daily coinsurance amounts after certain periods. The Part A deductible in 2024 is $1,632 per benefit period.

Disputing Medicare Coverage Decisions

Beneficiaries have the right to appeal a Medicare coverage decision if physical therapy services are denied. This appeals process allows individuals to challenge a determination they believe is incorrect.

The first level of appeal is a Redetermination. At this stage, the Medicare Administrative Contractor (MAC) that made the initial decision reviews the claim again.

If the redetermination is unfavorable, the next step is a Reconsideration. This second level of appeal involves an independent review by a Qualified Independent Contractor (QIC).

Should the reconsideration also result in an unfavorable decision, beneficiaries can request a hearing by an Administrative Law Judge (ALJ). This level of appeal typically requires that the amount in controversy meets a specific threshold to proceed. During the ALJ hearing, the beneficiary or their representative can present their case and evidence.

Following an ALJ decision, the next level is a review by the Medicare Appeals Council (MAC). This council, part of the Department of Health and Human Services, reviews the ALJ’s decision. The final administrative step is judicial review in a federal district court, which can be pursued if all prior administrative levels have been exhausted. Gathering all relevant medical records and documentation is important for supporting an appeal at any level.