How Much Physical Therapy Will Medicare Pay For?

Physical therapy is a healthcare service designed to improve how the body moves and functions following injury, illness, or surgery. It involves a combination of exercises, manual techniques, and education to enhance strength, flexibility, and overall mobility. Therapy also helps manage chronic conditions, alleviate pain, and prevent future injuries. Medicare, the federal health insurance program, does provide coverage for medically necessary physical therapy services. Understanding this coverage helps beneficiaries navigate their healthcare.

Medicare Coverage for Physical Therapy

Medicare covers physical therapy services based on the setting. Medicare Part B, Medical Insurance, primarily covers outpatient physical therapy. This includes therapy provided in various outpatient settings such as private physical therapy clinics, hospital outpatient departments, and physician’s offices. Part B also covers physical therapy services received in skilled nursing facilities when a patient is treated as an outpatient.

For physical therapy services received as part of an inpatient stay, Medicare Part A, Hospital Insurance, provides coverage. This applies when therapy is needed during a covered hospital stay or a skilled nursing facility stay after a qualifying hospital admission. In these settings, physical therapy is part of the overall inpatient benefit, with costs integrated into the total charges.

Medicare Part C, Medicare Advantage plans, are offered by private companies approved by Medicare. These plans must cover at least the same physical therapy services as Original Medicare (Parts A and B). However, Medicare Advantage plans may have different rules for provider networks, referrals, and cost-sharing. Beneficiaries enrolled in a Medicare Advantage plan should consult their specific plan documents to understand their physical therapy benefits.

Conditions for Coverage

For Medicare to cover physical therapy services, specific criteria must be met. The therapy must be deemed medically necessary by a physician or other authorized healthcare provider. This means it is required to diagnose or treat a condition, injury, or illness, or to restore and maintain function, not for general wellness. A doctor’s order, prescription, or referral is required before physical therapy services can begin.

The physical therapy must be provided by a licensed physical therapist or by a physical therapist assistant under the direct supervision of a licensed physical therapist. A written plan of care is a mandatory requirement, established by a physical therapist or physician and regularly reviewed by a physician. This plan outlines the patient’s diagnosis, long-term goals, and the type, amount, frequency, and duration of the therapy. The physician must certify this plan of care.

Medicare covers therapy not only for continuous improvement but also to maintain a patient’s current condition or to slow the progression of a condition, even if full recovery is not expected. While no hard cap exists on outpatient physical therapy costs, a “therapy threshold” monitors services. For 2024, this threshold is $2,330 for combined physical therapy and speech-language pathology services. Services exceeding this amount require the provider to attest to their medical necessity using a specific billing modifier, and may trigger a targeted medical review, but they can still be covered.

Your Share of Physical Therapy Costs

Your financial responsibility for physical therapy under Medicare involves out-of-pocket expenses. For outpatient physical therapy covered by Medicare Part B, beneficiaries must first meet an annual deductible. In 2024, this deductible is $240. After the deductible is satisfied, Medicare typically pays 80% of the Medicare-approved amount for the services. The beneficiary is then responsible for the remaining 20% coinsurance.

When physical therapy is received during a covered inpatient hospital or skilled nursing facility stay under Medicare Part A, the costs are generally part of the overall inpatient deductible and coinsurance for the stay. For 2024, the Medicare Part A inpatient hospital deductible is $1,632 per benefit period. For longer inpatient stays, coinsurance amounts apply, such as $408 per day for days 61-90 in a hospital, or $204 per day for days 21-100 in a skilled nursing facility. These costs are not separate charges for physical therapy but are part of the total bill for the inpatient care.

For beneficiaries enrolled in Medicare Advantage (Part C) plans, out-of-pocket costs can differ significantly from Original Medicare. These plans may have their own deductibles, copayments, or coinsurance amounts for physical therapy services. Review your specific plan’s Summary of Benefits to understand exact financial obligations, as these vary widely.

Medicare Supplement Insurance, or Medigap policies, can help reduce out-of-pocket costs for beneficiaries with Original Medicare. Medigap policies can cover some or all of the Medicare Part A and B deductibles and coinsurance, including the 20% coinsurance for outpatient physical therapy. This significantly lowers a beneficiary’s financial burden for medically necessary services. Medicare does not cover services not deemed medically necessary, such as general fitness, or those from non-approved providers. In these cases, the beneficiary is responsible for 100% of costs.