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Medicare Coverage for Outpatient Therapy

Medicare Coverage for Outpatient Therapy in 2020

Your Medicare Part B benefit helps pay for medically necessary outpatient physical therapy, occupational therapy, and speech-language pathology services.  Medicare Part B will NOT pay for outpatient therapy if you are currently receiving Medicare Part A home health or skilled nursing services.  Synergy Health and Wellness provides both physical therapy and occupational therapy services, however, we do not provide speech therapy.  If you need speech therapy services, we recommend considering Med-speech Voice and Swallow services located in Palm Beach Gardens, Florida.   Medicare coverage for outpatient therapy has some changes for 2020.

Let’s Go Over the Numbers

Deductible:  Medicare Part B has a yearly deductible for 2020 of $198.  Patients are responsible for paying this amount unless they have a secondary insurance that pays for the deductible.

Co- Insurance:  Medicare Part B covers 80% of Medicare allowed charges after the deductible is satisfied.   Patients are responsible for the 20% balance unless you have a secondary insurance that covers the full 20%.  We are finding that some secondary insurances also have deductibles or only pay a percentage of this balance.

Therapy Cap:  Medicare has established limitations on the amount of therapy you can receive in a calendar year.  These limits are called “therapy caps” or “therapy cap limits.”

The therapy cap limits for 2020 are:

  • $2,080 for physical therapy (PT) and speech-language pathology (SLP) services combined
  • $2,080 for occupational therapy (OT) services

We estimate that $2,080 covers eighteen 1-hour therapy sessions.

Additional Coverage for Outpatient Therapy May Be Available

Therapy Cap Exception:  Medicare coverage for outpatient therapy also has something called the exceptions process.   You may qualify to get an exception to the therapy cap limits so that Medicare will continue to pay its share for your therapy services after you reach the therapy cap limits. Your therapist or therapy provider must:

  • Establish your need for medically reasonable and necessary services and document this in your medical record
  • Indicate on your Medicare claim for services above the therapy cap that your outpatient therapy services are medically reasonable and necessary

Medical Record Threshholds:   There are additional limits (called “thresholds”).  If you get outpatient therapy services higher than the threshold amounts, a Medicare contractor may review your medical records to check for medical necessity. The medical record threshold amounts for 2020 are:

  • $3,000 for PT and SLP combined
  • $3,000 for OT

In general (when an exceptions process is in effect), if your therapist or therapy provider provides documentation to show that your services were medically reasonable and necessary and indicates this on your claim, Medicare will continue to cover its share above the $2,080 therapy cap limits. Because Medicare doesn’t pay for therapy services that aren’t reasonable and necessary, your therapist or therapy provider must give you a written notice, called an Advance Beneficiary Notice of Non-coverage (ABN), before providing generally covered therapy services that aren’t medically reasonable and necessary for you at the time.  Medicare doesn’t pay for therapy services that aren’t medically necessary. The ABN lets you choose whether or not you want the therapy services. If you choose to get the medically unnecessary services, you agree to pay for them.

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