How Do the Costs and Limitations for Medicare-covered Outpatient Therapy Work?

Original Medicare covers outpatient therapy at 80% of the Medicare-approved amount. When you receive services from a participating provider, you pay a 20% coinsurance after you meet your Part B deductible ($198 in 2020). If you are in a Medicare Advantage Plan, your costs may differ. You should contact your plan directly to find out what your estimated costs may be.

Previously, there were limits, also known as the therapy cap, on how much outpatient therapy Original Medicare covered annually. In 2018, the therapy cap was removed. However, if your total therapy costs reach a certain amount, Medicare requires your provider to confirm that your therapy is medically necessary. In 2020, Original Medicare covers up to $2,080 for physical therapy (PT), speech/language pathology (SLP), and occupational therapy (OT) before requiring your provider to indicate that your care is medically necessary. Medicare pays for up to 80% of the Medicare-approved amount. This means Original Medicare covers up to $1,664 (80% of $2,080) before your provider is required to confirm that your outpatient therapy services are medically necessary. If your provider confirms that your therapy is medically necessary, your skilled therapy coverage should continue.

Read More: Am I Eligible for Medicare Coverage of Inpatient Therapy Services?
Learn About: What Are the Medicare Coverage Qualifications for Skilled Therapy Services in an Inpatient Rehabilitation Hospital?
Return to: Medicare In-Depth

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