Does Medicare Cover Physical Therapy?

Of all the service categories on this site, physical therapy is the one where Medicare actually does its job well. There’s no annual visit cap. There’s no specialty tier. There’s no prior authorization wall in Original Medicare. As long as your therapist documents that you’re making progress toward functional goals, the program will pay — even into expensive territory above the $2,410 annual threshold, even for chronic conditions, even after a stroke when recovery is going to be measured in months and years.

This is genuinely good news, and it deserves to be stated cleanly because so much of Medicare coverage runs in the opposite direction. The catch — to the extent there is one — is administrative. The therapist documentation has to be solid. The plan of care has to be signed and re-signed on schedule. The KX modifier has to be added correctly above the threshold. None of this is hard, but it requires a competent therapy practice that knows how to bill Medicare. Pick a poorly-run practice and you’ll discover what “covered with documentation requirements” can mean in practice.

What Original Medicare covers

Outpatient physical therapy is a Part B benefit. Coverage requires:

• A physician-signed plan of care documenting medical necessity
• A therapist who is a Medicare-enrolled provider (PT, OT, or speech-language pathologist as appropriate)
• Ongoing documentation of progress toward functional goals
• Re-certification of the plan of care every 90 days for continuing care

Covered settings include:

• Outpatient PT clinics
• Hospital outpatient departments
• Skilled nursing facilities (when not in a Part A skilled-stay)
• Home health agencies (under the home health benefit, separate from outpatient PT)
• Therapist’s office or your home (when delivered by an independent therapist)

Cost-sharing in 2026:

• Annual Part B deductible: $257
• After the deductible: 20% coinsurance on the Medicare-approved amount
• Medigap policies (Plans G, N, etc.) cover the 20% coinsurance, typically reducing your out-of-pocket to nearly $0

The Medicare-approved amount for a typical outpatient PT visit ranges from $90 to $130 depending on the codes billed. Your 20% share is $18 to $26 per visit if you’re on Original Medicare without Medigap.

The annual threshold and what it actually means

This is the part where most explanations get confusing, so it’s worth saying clearly: there is no longer an annual cap on physical therapy under Medicare. It was repealed permanently in 2018.

What exists in its place is an annual threshold for documentation. In 2026, that threshold is $2,410 for combined PT and speech-language pathology services, with a separate $2,410 threshold for occupational therapy. (The numbers update annually based on inflation.)

When your annual therapy spending crosses that threshold, two things happen:

1. Your therapist adds the KX modifier to each subsequent claim. The KX modifier is a code that attests “continued therapy is reasonable and necessary.” It’s a billing code, not a request for permission. The therapist documents medical necessity in your file, adds the modifier to the claim, and the claim is paid.
2. Medicare may target a sample of claims for manual medical review when annual spending exceeds $3,000. This is a sample-based audit process — a small number of claims may be selected for additional documentation review. The vast majority of patients never have a claim selected for this review.

In practice: as long as your therapist is documenting your progress and using the KX modifier appropriately above the threshold, your therapy is paid. Patients regularly receive 50, 80, even 100+ visits per year without coverage interruption when medically necessary.

When PT crosses into Part A territory

A different coverage structure applies to inpatient rehab.

If you’re admitted to a hospital and then transferred to a Skilled Nursing Facility for rehabilitation, the SNF stay is covered under Part A as long as:

• You had a qualifying inpatient hospital stay of at least 3 days (note: observation status doesn’t count)
• You enter the SNF within 30 days of hospital discharge
• You need skilled rehab or nursing services daily
• A physician certifies the medical necessity

Cost-sharing for SNF stays in 2026:

• Days 1–20: $0 coinsurance
• Days 21–100: $209.50 per day
• Beyond 100 days: 100% out of pocket

Most patients are discharged from SNF rehab within 20–30 days, so the worst-case cost for a typical post-surgery rehab stay is in the $2,000–$3,000 range — and Medigap Plans G, N, and others cover that SNF coinsurance entirely.

For more intensive rehabilitation needs — typically after stroke, traumatic brain injury, or complex orthopedic surgery — Inpatient Rehabilitation Facilities (IRFs) provide a higher level of care than SNFs. IRF stays are also covered under Part A, with similar cost-sharing structure.

Home health PT vs. outpatient PT

Two different benefits, two different cost structures. They’re worth distinguishing because patients often confuse them.

Home health PT (Medicare home health benefit) Covered when:

• You qualify as homebound (leaving home is a considerable and taxing effort)
• Your physician orders home health services
• You require skilled care intermittently
• You receive care from a Medicare-certified home health agency

Cost: $0 coinsurance for the home health PT visits themselves under the Medicare home health benefit.

This is the right benefit for someone recently discharged from a hospital who’s struggling to leave home for outpatient PT. Coverage is time-limited — typically a 60-day “episode” with possible extensions if continued homebound status and skilled need persist.

Outpatient PT delivered at home A different model: an independent licensed PT comes to your house and bills under Part B as outpatient therapy. You’re not required to be homebound; the home is just a setting. Cost: 20% Part B coinsurance.

Some areas have growing outpatient-at-home practices, especially for orthopedic post-surgical care.

Medicare Advantage and PT — the friction point

If you’re on a Medicare Advantage plan, your PT coverage is technically equivalent to Original Medicare’s — federal rules require MA plans to cover all the same services Original Medicare covers. In practice, MA plans usually:

• Charge per-visit copays ($25–$45 is typical) instead of 20% coinsurance
• Require prior authorization, often after a small number of initial visits
• Have a network of preferred providers

Most patients can find a competent PT in their MA plan’s network without trouble. The friction usually arises when ongoing care extends past the plan’s authorized number of visits — getting the next batch authorized often requires the therapist to submit functional documentation, sometimes multiple times. A competent PT practice handles this routinely; an inexperienced one can leave you with care interruptions.

If you’re choosing between Original Medicare with a Medigap policy versus Medicare Advantage and you anticipate significant ongoing PT needs (e.g., post-stroke recovery, chronic Parkinson’s care), Original Medicare with Medigap usually delivers a smoother experience. The cost-sharing predictability and absence of prior authorization friction matters when you’re going to therapy 2–3 times a week for months.

Common reasons PT claims get denied

Most denials are administrative, not clinical:

• Plan of care expired (not re-certified at 90 days)
• Therapist documentation doesn’t show progress or skilled need
• KX modifier not used above threshold
• Therapist isn’t Medicare-enrolled
• Services billed under wrong codes (e.g., billing exercise tolerance as therapeutic exercise)

When claims are denied, the appeal process works. Submit a redetermination with the therapist’s documentation and the clinical rationale, and most administratively-denied claims are reversed.

Bottom line

Physical therapy is one of the few categories where Medicare’s coverage is genuinely good and the practical experience matches the theoretical coverage. No visit cap. Reasonable cost-sharing. Medigap fills the gap if you carry one. The main thing is choosing a therapy practice that knows how to bill Medicare correctly and document medical necessity, particularly above the $2,410 annual threshold. Get that right, and ongoing PT — even for years — is something Medicare will support.