Medicare Therapy Coverage: PT, OT & SLP Explained (2026)

Medicare sets no lifetime dollar cap on therapy, but once your combined therapy charges pass $2,480 in 2026, one billing code decides whether Medicare pays.1 That code is the KX modifier: your therapist appends it to attest the therapy is still medically necessary, and without it Medicare's claims system automatically denies every claim above the threshold. Outpatient physical therapy (PT), occupational therapy (OT), and speech-language pathology (SLP) are covered under Medicare Part B when a doctor orders them and they are medically necessary; after the annual Part B deductible of $283, you pay 20% of the Medicare-approved amount for each session.2,3

What Medicare Part B covers

Medicare Part B covers three categories of outpatient therapy when a physician or other qualified practitioner orders the services and they are medically necessary:3

• Physical therapy (PT): evaluation and treatment for mobility, strength, pain, and functional limitations.
• Occupational therapy (OT): evaluation and treatment to help you perform daily activities after illness, injury, or disability.
• Speech-language pathology (SLP): evaluation and treatment for swallowing disorders, language difficulties, and voice and cognitive-communication problems.

Coverage applies whether you receive services in a private outpatient therapy office, a hospital outpatient department, a skilled nursing facility on an outpatient basis, or in your home through a home health agency. The setting determines which Medicare billing rules apply, but the core benefit is Part B in each case.

Medicare Advantage (Part C) plans must cover every medically necessary PT, OT, and SLP service that Original Medicare would cover.4 Individual plans may require prior authorization before certain therapy services, so check your plan's Evidence of Coverage before beginning a new course of treatment.

What Medicare therapy coverage costs in 2026

Part B covers outpatient therapy at 80% of the Medicare-approved amount once you meet the annual deductible. You pay the remaining 20% coinsurance, plus the $283 deductible if you have not yet met it for the year.2

If you have a Medigap (Medicare Supplement) policy, it generally covers the 20% coinsurance you would otherwise owe. If you are in a Medicare Advantage plan, your plan's cost-sharing structure applies instead of the standard 20% coinsurance.2

How the KX modifier threshold works

Before 2018, Medicare imposed hard annual dollar caps on outpatient therapy. The Bipartisan Budget Act of 2018 repealed those caps. In their place, Congress established a threshold and attestation system built on the KX modifier, a billing code a therapist appends to a claim to attest that services above a set dollar amount remain medically necessary.1

For 2026, the threshold is $2,480 for the combined total of PT and SLP services for a single beneficiary, and a separate $2,480 threshold applies to OT services.1 Medicare tracks spending independently for the PT-plus-SLP pool and the OT pool, so hitting the threshold in one pool does not affect the other.

Once your combined PT and SLP charges reach $2,480 in a calendar year, your treating therapist must add the KX modifier to every subsequent claim.1 The modifier is a formal attestation that:

1. The therapist has assessed you and determined that continued therapy is medically necessary.
2. That determination is documented in your medical record.

Without the KX modifier on a claim above the threshold, Medicare's system automatically denies it. This is not a judgment call, it is an automated processing rule. If your therapist omits the modifier on a claim above $2,480, that specific claim will not pay, even when the therapy itself is genuinely medically necessary.1

If you are approaching or have passed $2,480 in combined PT and SLP charges, confirm with your therapist that they are tracking your running total and will attach the KX modifier to each claim going forward.1 Ask to see that it is reflected on the Medicare Summary Notice you receive after each round of billing.

The targeted medical review threshold

At $3,000 in therapy spending, claims become subject to targeted medical review. A Medicare contractor may request documentation from the treating therapist to verify medical necessity before payment is approved. This threshold is set at $3,000 through CY2028, after which it is indexed annually to the Medicare Economic Index (MEI), per CMS guidance on therapy services.1

Targeted review does not mean the therapy is denied. It means a Medicare contractor is more likely to audit a specific claim or request supporting records. The practical takeaway for patients is the same as with the KX threshold: make sure your therapist keeps thorough notes documenting medical necessity at each visit, and that the KX modifier is on every claim above $2,480.1

There is no lifetime cap on medically necessary therapy

Medicare does not limit how much therapy it will pay for over your lifetime, as long as the therapy remains medically necessary.3 The old lifetime caps were a source of real hardship for beneficiaries with chronic or degenerative conditions who needed ongoing therapy, and the 2018 repeal eliminated them.

What Medicare still requires is that each course of therapy be ordered by a physician or qualified practitioner and that the services remain medically necessary throughout treatment. If a physician determines that further therapy is not reasonable and necessary, coverage may end. But the dollar amount you spent in prior years has no bearing on whether coverage applies now.

Medicare Advantage and therapy coverage

Medicare Advantage plans must cover PT, OT, and SLP whenever those services would be covered by Original Medicare.4 Most Medicare Advantage plans, however, require prior authorization before approving a new course of treatment or continuing treatment beyond a set number of visits. Failing to obtain prior authorization can result in a denied claim even when the therapy is medically necessary.

As the Original Medicare vs. Medicare Advantage comparison explains, one key difference is that Original Medicare generally does not require prior authorization for outpatient therapy, while nearly all Medicare Advantage plans do. If you are in a Medicare Advantage plan and your therapy requests have been denied or limited, you have the right to appeal; ask your plan for its formal appeals process in writing.

To check your own spending against the threshold or confirm that a claim was processed with the KX modifier, review your Medicare Summary Notice or call 1-800-MEDICARE (1-800-633-4227).

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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.