Georgia Medicare Therapy Cap Repeal, KX Threshold 2026

If you have both Medicare and Georgia Medicaid and you need ongoing physical, occupational, or speech therapy, there is no longer an annual dollar cap that cuts your coverage off. The Medicare therapy cap repeal, enacted by the Bipartisan Budget Act of 2018, ended the old hard limit for good.1

What replaced it is a reporting step, not a ceiling. Once your therapy spending crosses an annual threshold, your therapist adds a billing code called the KX modifier to attest that continued care is medically necessary, and coverage keeps going as long as you need skilled therapy. For a Georgia dual eligible, the added protection is financial: Georgia Medicaid can pick up the 20% coinsurance that Medicare leaves you, so extended therapy does not have to mean a growing bill.

This guide explains what the cap was, what the 2018 repeal changed, the CY 2026 KX and medical review thresholds, how coverage works alongside the Jimmo settlement, and exactly how a Georgia beneficiary with both programs gets help and appeals a denial.

The Medicare therapy cap repeal, in plain terms

For 20 years, Medicare put an annual dollar limit on how much outpatient physical therapy (PT), occupational therapy (OT), and speech-language pathology (SLP) it would pay for. If your stroke recovery, Parkinson's therapy, or post-surgery rehab ran long, you could hit that limit partway through the year and lose coverage even though you still needed care. The Bipartisan Budget Act of 2018 ended that. It repealed the therapy cap and put a simpler system in its place.1

Here is what it means for you as a Georgia beneficiary:

• There is no ceiling on medically necessary therapy. As long as a therapist documents that skilled care is helping you improve, maintain function, or slow decline, Medicare Part B keeps covering it.5
• The "threshold" you may hear about is not a cap. It is the dollar point where your therapist adds the KX modifier to your claim, a routine attestation, not a stop sign.
• Ask one question at your visits: if you are getting a lot of therapy, ask your clinic to confirm they are tracking your yearly total and will add the KX modifier once you pass the threshold, so no claim gets denied on a technicality.

What you pay, and how Georgia Medicaid can cover it

The cap repeal removed the dollar limit. It did not remove ordinary Medicare cost-sharing. Under Original Medicare, outpatient therapy is a Part B service, so after the annual Part B deductible of $283 you pay 20% coinsurance of the Medicare-approved amount.2 That 20% adds up on a long course of therapy.

This is where being a Georgia dual eligible matters. If you qualify for a Medicare Savings Program, Georgia Medicaid pays part or all of your Medicare cost-sharing:

• Qualified Medicare Beneficiary (QMB) is the strongest. It pays your Medicare premiums, deductibles, and coinsurance, and federal law bars your provider from billing you for those amounts (no balance billing). For a QMB, the therapy coinsurance is covered in full.3
• In Georgia, you apply for QMB at your county Division of Family and Children Services (DFCS) office on form 700, online at Georgia Gateway, or by calling DFCS at 1-877-423-4746. An Extra Help application filed with the Social Security Administration also counts as an MSP application.3,6
• For 2026, the federal QMB limits are monthly income of $1,350 for an individual and $1,824 for a couple, with a resource limit of $9,950 individual and $14,910 for a couple. One caution specific to Georgia: the state's own MSP FAQ still publishes an older, lower resource ceiling of $7,390 for one person and $11,090 for a couple. If your savings fall between the two figures, apply rather than assume you are over the limit, and ask DFCS to confirm the current number.3 Neither figure is a self-screening cutoff even for someone above both: these are the federal standards, and states can effectively raise the income and resource limits by disregarding certain income and resources, so apply and let DFCS do the counting.3

If you have full Georgia Medicaid alongside Medicare, you may also be able to enroll in a Dual Eligible Special Needs Plan (D-SNP), the type of Medicare Advantage Special Needs Plan built for people who have both coverages. A D-SNP is an HMO or PPO that covers the same Part A and Part B benefits as any other Medicare Advantage plan, including outpatient therapy, adds care coordination, and must include Part D drug coverage; you can stay enrolled only as long as you keep meeting the plan's conditions. Which plans exist varies by county, because insurers choose where they do business, and Georgia's Department of Community Health announced that it would place a moratorium on contracting with any new D-SNPs starting August 1, 2025, to comply with the federal D-SNP integration rules, with further updates to come. So check what is actually offered at your address through the Medicare Plan Finder or with a GeorgiaCares counselor rather than assuming a particular plan is available.7

History of the Medicare therapy cap repeal

Understanding where the cap came from explains why the repeal mattered so much.1

• The cap began with the Balanced Budget Act of 1997. Congress set an annual per-beneficiary dollar limit on outpatient therapy, with PT and SLP sharing one limit and OT under a separate one.
• For years, Congress patched it rather than fixing it. An exceptions process let therapy continue past the cap when documented as medically necessary, but it had to be renewed again and again, leaving beneficiaries and clinics unsure each year whether coverage would hold.
• The Medicare Access and CHIP Reauthorization Act of 2015 extended the exceptions and shifted to a targeted, risk-based medical review, setting up the permanent fix that came next.

What the BBA 2018 Medicare therapy cap repeal changed

The Bipartisan Budget Act of 2018, at Section 50202, did what two decades of temporary patches had not: it permanently repealed the outpatient therapy caps.1 In their place, Congress kept two things that protect the program without limiting your care:

1. A KX modifier threshold. Above an annual dollar amount, your therapist attests in the record that continued therapy is medically necessary. There is no denial simply for crossing it.
2. A targeted medical review threshold. A higher dollar amount above which a Medicare contractor may, based on risk factors, ask to review documentation. This is a paperwork check, not a cap.

What the repeal did not do: it did not remove your Part B coinsurance, did not weaken the "reasonable and necessary" coverage standard, and did not override the Jimmo settlement. The artificial dollar limit is gone; everything else about how Medicare judges therapy stayed the same.

The KX modifier threshold and CY 2026 amounts

For calendar year 2026, the KX modifier threshold is $2,480 for physical therapy and speech-language pathology combined, and a separate $2,480 for occupational therapy. When your annual spending in a category crosses that amount, your therapist appends the KX modifier to each later claim to attest three things: the services are reasonable and necessary, the record documents that need, and your plan of care supports continuing.1

The practical risk for a beneficiary is small but real: if the therapist forgets to add the KX modifier on a claim above the threshold, Medicare's system will automatically deny that specific claim, even though the therapy was genuinely necessary.5 If you see a denial like that on your Medicare Summary Notice, it is usually a billing fix, not a coverage loss; ask your clinic to refile the claim with the KX modifier.

The targeted medical review threshold

Above the KX threshold sits a separate targeted medical review threshold of $3,000, which holds through CY 2028 and is indexed to the Medicare Economic Index after that.1 Crossing it does not deny your therapy. It means a Medicare contractor may select a claim for review and ask your provider for records showing the care is medically necessary. As long as the documentation supports the need, coverage continues.

How the cap repeal works with the Jimmo settlement

The cap repeal removed a dollar limit. The Jimmo v. Sebelius settlement protects the coverage standard behind it. Under Jimmo, Medicare covers skilled therapy when the skill of a professional is needed to maintain your condition or to prevent or slow decline, not only when you are expected to improve.4 The old "you must keep getting better to keep coverage" rule is a myth.

For a Georgia beneficiary with a chronic or progressive condition, the two work together. Multiple sclerosis, Parkinson's disease, ALS, and post-stroke maintenance no longer run into a dollar wall (cap repeal), and skilled maintenance therapy stays covered when a professional's skill is required to deliver it (Jimmo). Documentation should reflect both: the medical necessity the KX modifier attests to, and the skilled maintenance need that Jimmo protects.

Outpatient therapy vs home health and SNF therapy

The KX threshold framework applies to outpatient therapy under Part B, delivered at hospital outpatient departments, clinics, and private practices. Two related settings follow different rules:

• Home health therapy. If you are confined to the home, are under a plan of care a physician establishes and reviews, and need intermittent skilled care, Medicare covers therapy under the home health benefit when a Medicare-certified home health agency furnishes it. That benefit has its own rules, and you generally pay $0 for the covered home health services themselves.8
• Skilled nursing facility (SNF) therapy. Therapy during a covered Part A SNF stay is bundled into that benefit and is not subject to the outpatient KX threshold. A resident who receives outpatient therapy under Part B after the Part A benefit is exhausted is back under the outpatient rules.

If you also receive lymphedema treatment, note a separate benefit: under the Lymphedema Treatment Act, Medicare has covered compression garments and supplies for lymphedema since January 1, 2024, apart from the therapy visits themselves.9

What to do if your therapy is denied

A denial is not the end of the road. Original Medicare gives you five levels of appeal, each with its own deadline, and the first two carry no minimum dollar amount.10

If a specific therapy service is expected to be denied as not reasonable and necessary, your provider may give you an Advance Beneficiary Notice of Noncoverage (ABN, Form CMS-R-131) beforehand. Read the three options on that form carefully, because only one of them keeps your appeal rights. Option 1 means you receive the therapy and the provider bills Medicare, so if Medicare denies the claim you owe the bill but you can appeal. Option 2 means you receive the therapy and Medicare is not billed, so you pay and cannot appeal. Option 3 means you decline the service, with no claim and no appeal. An ABN is not itself a Medicare denial, and it is used only under Original Medicare, not by a Medicare Advantage or Part D plan.11 Local Coverage Determinations, the coverage rules a Medicare Administrative Contractor issues for its own jurisdiction, decide whether a service is reasonable and necessary there and cannot contradict a national coverage determination.12

Frequently asked questions

Is there still a Medicare therapy cap?

No. The Bipartisan Budget Act of 2018 permanently repealed the outpatient therapy caps. A threshold-and-attestation system using the KX modifier replaced them, and there is no dollar limit on medically necessary PT, OT, or speech therapy.

What are the 2026 therapy thresholds?

For CY 2026, the KX modifier threshold is $2,480 for physical and speech therapy combined and $2,480 for occupational therapy. The separate targeted medical review threshold is $3,000, which holds through CY 2028.

As a Georgia dual eligible, what do I actually pay for therapy?

Under Original Medicare you would pay the $283 Part B deductible and 20% coinsurance. If you are a Qualified Medicare Beneficiary through Georgia Medicaid, that cost-sharing is covered and your provider cannot bill you for it.

Does coverage stop if I am not getting better?

No. Under the Jimmo settlement, Medicare covers skilled therapy needed to maintain your condition or slow decline, not only therapy expected to improve you. A denial based only on lack of improvement is worth appealing.

What if my therapist forgets the KX modifier?

Medicare will automatically deny that claim once you are above the threshold. This is a billing fix, not a coverage loss. Ask your clinic to refile the claim with the KX modifier attached.

Resources and contacts

Learn more

Find personalized help navigating Medicare outpatient therapy coverage in Georgia at brevy.com.

The information on Brevy.com is for educational purposes only and is not a substitute for professional legal, financial, or medical advice. Rules vary by state and program and change frequently. Always verify with the relevant agency or a qualified professional. Brevy is not a law firm, financial advisor, or healthcare provider.