Medicare Physical Therapy Rules & Regulations

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Medicare Part B covers medically necessary outpatient physical therapy up to a specified annual dollar limit. The therapy must be reasonable and necessary to help you regain strength and mobility, maintain a level of strength and mobility or keep you from suffering further functional deterioration.

Medicare Physical Therapy Coverage Limits

Medicare’s combined cap for physical therapy, or PT, and speech language pathology services, or SLP, is $1,940 per calendar year. You are limited by the $1,940 cap whether you do only PT, only SLP, or a combination of both. Medicare permits an exception to this cap if your physical therapist certifies that additional therapy is medically reasonable and necessary for you to improve, maintain function or not lose more function. This certification must be fully documented in your medical record and on the Medicare claim form. If Medicare approves additional therapy, it will be limited by a combined PT and SLP threshold of $3,700. Once you reach $3,700, Medicare may initiate a special review of your medical records to justify further coverage.

Tip

  • If you are covered under a Medicare Part C Advantage Plan, your plan covers at least what Medicare Parts A and B cover but may cover more than Medicare. You should check with your plan.

Eligibility

All Medicare participants with Part B are eligible for medically necessary PT. Medicare will cover 80 percent of the Medicare-approved cost, and you or your co-insurance will be responsible for 20 percent of the cost. The Part B deductible applies to this coverage. The cap and threshold limits are based on the total cost, even if Medicare only pays 80 percent of it.

Your physical therapist must give you a written Advance Beneficiary Notice of Noncoverage if Medicare determines that your initial or continued PT is not reasonable or necessary and denies coverage. The therapist must give this to you before he begins any of the noncovered therapy, so you can decide to forgo the therapy or pay privately.

Medically Reasonable and Necessary Standards

Medicare requires the following to establish that the PT is medically reasonable and necessary:

  1. A physician or other medical professional  must certify that you are in need of skilled and specialized physical
    therapy due to injury, illness or clinical condition.
  2. The proposed therapy must be reasonable for your diagnosis and the severity of your impairment.
  3. You must require PT for one of the following reasons:
  • To restore your function after illness or injury
  • To maintain a level of function that cannot be
    maintained without skilled PT
  • To prevent functional deterioration that will likely
    occur without skilled PT

Tip

  • State law governs whether or not you can obtain physical therapy services without a physician's order. However, a physician's order will help you satisfy Medicare's reasonable and necessary requirement.

The Physical Therapy Plan of Care

Your physician or physical therapist handles submitting paperwork to Medicare. Each time you begin a new PT series, your physician or physical therapist must submit a written plan of care. The plan must establish the reasonableness and necessity of the proposed therapy and include:

  • The physician or other medical professional's certification that you need skilled physical therapy. 
  • The results of  the therapist's initial evaluation and functional assessment.
  • Your diagnosis.  
  • The planned physical therapy services and the amount, frequency
    and duration of these services.
  • The anticipated goals of the therapy, both short term and
    long term. 

Your physician or therapist can modify the plan of care in writing anytime during your treatment. During treatment, the therapist may periodically re-evaluate you. The therapist will compare your current function level to your previous function level and determine where you are in achieving the plan of care’s goals. If the plan is complete or needs updating, your therapist will note this. Your therapist may confer with your physician and must submit Medicare’s required reporting and documentation.

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