Medicare covers 80% of the approved amount for outpatient physical therapy after you meet your annual Part B deductible. You pay the remaining 20% as coinsurance, with no hard cap on the number of visits as long as your therapy is medically necessary. But the details vary depending on where you receive care, what type of Medicare plan you have, and how much therapy you need in a given year.
What You Pay for Outpatient Physical Therapy
Under Original Medicare (Part B), physical therapy works like most other outpatient services. You first pay the annual Part B deductible, then Medicare picks up 80% of the approved amount for each visit. Your share is the remaining 20% coinsurance. There’s no copay per visit beyond that percentage, though the dollar amount depends on what services your therapist bills for during each session.
If you have a Medigap (supplement) plan, it may cover part or all of that 20% coinsurance. Without supplemental coverage, costs can add up over a longer course of treatment. For example, if Medicare approves $150 for a session, you’d owe $30 out of pocket for that visit.
Annual Spending Thresholds
Medicare no longer has a strict annual dollar cap on physical therapy, but it does have spending thresholds that trigger extra scrutiny. For 2026, the threshold is $2,480 for physical therapy and speech therapy services combined. Occupational therapy has its own separate $2,480 threshold.
Below that amount, claims are processed normally. Once your therapy charges cross the threshold, your therapist must confirm in writing that continued treatment is medically necessary, supported by documentation in your medical record. Claims submitted above the threshold without this confirmation are automatically denied. If your spending climbs even higher, Medicare may flag your case for a targeted medical review, where a reviewer examines your records before approving further payment.
This doesn’t mean your therapy stops at $2,480. It means your therapist needs to keep thorough records showing why you still need treatment. If the documentation supports it, Medicare continues paying its 80% share well beyond that amount.
What “Medically Necessary” Means in Practice
Medicare only covers physical therapy that meets its standard for medical necessity. In practical terms, this means three things: your treatment must follow accepted standards of care for your condition, the frequency and duration of visits must be reasonable, and your medical record must show you’re making meaningful progress.
Your therapist documents your functional abilities before, during, and after treatment. Medicare wants to see that you’re improving in ways that matter for daily life, not just on paper. If you’ve plateaued or reached your therapy goals, coverage ends for that episode of care, even if you’d prefer to keep going. The progress needs to be sustainable and of practical value compared to where you started.
A doctor or other qualified provider must certify your therapy plan. This certification needs to happen within 30 days of your first treatment session, including your initial evaluation. Your therapist develops the plan of care, and your referring physician signs off on it within that window.
When You Might Owe the Full Cost
If Medicare determines that your physical therapy is no longer medically necessary, your therapist is required to notify you in advance using a form called an Advance Beneficiary Notice (ABN). This notice explains that Medicare likely won’t pay for the upcoming services and gives you three choices: have the claim submitted to Medicare anyway (and accept responsibility if it’s denied), agree to pay out of pocket without involving Medicare, or decline the services entirely.
This situation commonly arises when you’ve met your therapy goals and been discharged from your Medicare-covered episode but want to continue with maintenance or wellness-focused sessions. Your therapist can’t simply bill you without warning. If they fail to give you the ABN before providing services that Medicare denies, the therapist, not you, is financially responsible for the cost.
Physical Therapy at Home Costs Nothing Extra
If you qualify for home health services, physical therapy delivered in your home is covered differently. Medicare pays 100% of covered home health physical therapy, with no coinsurance and no deductible. You pay nothing for the therapy itself. The only exception is durable medical equipment (like a walker or exercise bands), which still falls under the standard 20% coinsurance after your Part B deductible.
To qualify, you generally need to be homebound and require skilled care on an intermittent basis, ordered by a physician. Home health PT can be a significant cost advantage if you meet the criteria, since the same therapy in an outpatient clinic would cost you 20% of every visit.
How Medicare Advantage Plans Differ
Medicare Advantage (Part C) plans must cover everything Original Medicare covers, including physical therapy. But the rules around accessing that coverage often differ in important ways.
Most Medicare Advantage plans require you to use in-network providers. Going out of network for physical therapy typically means higher costs or no coverage at all. Many plans also require prior authorization for certain services, meaning your plan must approve your therapy before it begins or before continuing past a certain number of visits. Original Medicare has no such pre-approval requirement for outpatient physical therapy.
Your cost-sharing structure may also look different. Instead of the flat 20% coinsurance, a Medicare Advantage plan might charge a fixed copay per visit, like $20 or $40. Some plans cap your total out-of-pocket spending for the year, which Original Medicare alone does not. Check your plan’s Summary of Benefits for the specific copay or coinsurance it charges for physical therapy, and whether it limits the number of covered visits per year.
Services From a Physical Therapist Assistant
If some or all of your therapy session is provided by a physical therapist assistant (PTA) rather than a licensed physical therapist, Medicare reduces its payment to 85% of the standard rate. This has been in effect since January 2022. The reduction applies to the Medicare payment, so your 20% coinsurance is calculated on the lower amount. In practice, this means your out-of-pocket cost per visit is slightly less when a PTA provides care, though the total reimbursement your therapy clinic receives is also lower.
This payment difference doesn’t change what services you can receive. PTAs work under the supervision of a physical therapist and deliver the same hands-on treatment. But it’s worth knowing that the billing structure differs, especially if your clinic discusses scheduling you with an assistant versus the lead therapist.