What is the difference between Medicare Part A and B therapy?

According to the Centers for Medicare & Medicaid Services, Original Medicare is divided into two parts, with each part covering different types of medical care. Understanding what is the difference between Medicare Part A and B therapy is crucial for navigating your healthcare options, as the distinction affects where you receive care, what services are covered, and your potential out-of-pocket costs.

Quick Summary

Medicare Part A primarily covers therapy provided during an inpatient hospital stay or skilled nursing facility stay, while Part B covers outpatient therapy services. These include physical, occupational, and speech-language therapies, with distinct cost-sharing structures and settings for each part.

Key Points

• Setting is Key: Medicare Part A covers inpatient therapy (hospital, SNF), while Part B covers outpatient therapy (clinics, offices).

• Coverage vs. Cost: Part A ties costs to a 'benefit period' following a hospital stay, while Part B involves an annual deductible and a 20% coinsurance for services.

• Outpatient Flexibility: Part B therapy does not require a prior hospital stay, offering more flexibility for ongoing or chronic conditions.

• Lifetime Limits: A lifetime limit of 190 days applies to inpatient psychiatric hospital care under Part A, while Part B has no such limit on medically necessary services.

• Medical Necessity: Both Part A and B require that a doctor certifies your therapy as medically necessary for coverage.

• Therapy Cap Eliminated: Medicare no longer has a therapy cap for outpatient services, but providers must confirm medical necessity once a certain cost threshold is reached.

• Medicare Advantage: Coverage rules for therapy can differ under Medicare Advantage (Part C) plans, so it is essential to check your specific plan details.

Medicare Part A: The Inpatient Therapy Plan

Medicare Part A, also known as hospital insurance, covers therapy services you receive as part of a stay in an inpatient setting. This is typically for short-term care following an illness, injury, or surgery. The coverage is tied directly to your admission as an inpatient, meaning therapy is part of a broader care plan that includes room and board, nursing care, and other hospital services.

Where is Part A therapy provided?

• Acute Inpatient Rehabilitation Facility (IRF): These facilities offer intensive, coordinated rehabilitation services for those recovering from serious injuries, illnesses, or surgery. A doctor must certify the need for intensive rehab, and the therapy is a core component of the daily treatment plan.
• Skilled Nursing Facility (SNF): If you require skilled nursing care or therapy after a qualifying three-day inpatient hospital stay, Part A covers therapy services in an SNF for a limited time.
• Psychiatric Hospital: Inpatient mental health services, including therapy, received in a psychiatric hospital are covered by Part A, with a lifetime limit of 190 days.

Part A cost structure for therapy

Costs under Part A are managed per “benefit period,” which begins the day you are admitted as an inpatient and ends once you have not received inpatient hospital or SNF care for 60 consecutive days.

• Deductible: You must pay a deductible for each benefit period before Medicare begins to pay.
• Coinsurance: After the deductible is met, you may face daily coinsurance charges for longer stays in a hospital or SNF.

Medicare Part B: The Outpatient Therapy Plan

Medicare Part B, or medical insurance, covers therapy services when you are an outpatient. Unlike Part A, this coverage is not tied to a hospital or SNF stay. Part B therapy is for situations where you require ongoing treatment, rehabilitation, or symptom management that does not require an overnight stay.

Where is Part B therapy provided?

• Private Practice Therapist Offices: This includes physical, occupational, and speech-language pathology clinics.
• Hospital Outpatient Departments: You can receive therapy in a hospital's outpatient clinic without being admitted as an inpatient.
• Comprehensive Outpatient Rehabilitation Facilities (CORFs): These facilities provide a wide range of outpatient rehab services.
• Skilled Nursing Facilities (SNFs): Part B covers therapy in an SNF if you are an outpatient or are not eligible for a Part A-covered stay.

Part B cost structure for therapy

Costs for Part B are based on an annual deductible and a coinsurance percentage.

• Premium: Most beneficiaries pay a monthly premium for Part B.
• Deductible: You must meet an annual deductible before Medicare starts paying its share.
• Coinsurance: After the deductible is met, you typically pay 20% of the Medicare-approved amount for the therapy services.
• No Therapy Cap: Medicare no longer has an annual therapy cap, but once costs reach a certain amount, your provider must confirm that the therapy remains medically necessary.

Key Differences Explained

Feature	Medicare Part A (Inpatient)	Medicare Part B (Outpatient)
Coverage Setting	Primarily covers therapy received during an inpatient stay in a hospital, skilled nursing facility (SNF), or psychiatric hospital.	Covers therapy received in a doctor's or therapist's office, hospital outpatient department, or CORF.
Cost Structure	Costs are tied to each “benefit period,” which includes a deductible and potential daily coinsurance for longer stays.	Costs are based on an annual deductible, after which you pay a 20% coinsurance for most services.
Pre-requisite	Requires a qualifying inpatient hospital stay for SNF care eligibility.	Does not require a prior hospital stay for coverage.
Duration of Care	Designed for short-term, intensive care following a hospital admission.	Covers long-term, ongoing therapy for chronic conditions or recovery.
Home Health Care	May cover home health therapy as part of a post-hospitalization benefit.	May cover therapy at home if not eligible for the home health benefit or if the provider travels to your home.
Lifetime Limit	A lifetime limit of 190 days applies to inpatient care in a psychiatric hospital.	No lifetime limit on coverage for medically necessary services.

Making the Right Choice for Your Needs

The appropriate Medicare part for your therapy needs depends entirely on your specific medical situation. If you require intensive, round-the-clock care following a major event like a stroke or surgery, Part A's inpatient coverage would be your primary source of therapy. For those with chronic conditions, recovering at home, or needing a few sessions a week, Part B's outpatient coverage is the correct route.

It's important to remember that both Parts A and B require that therapy be deemed medically necessary by a doctor and follow a certified plan of care. Your physician and therapy provider will work together to determine the most suitable setting and program for your recovery, which dictates which part of Medicare is billed. For beneficiaries who have Medicare Advantage (Part C) plans, the coverage details may be slightly different and are determined by the private insurance company, so it is always wise to check your plan's specific benefits.

Conclusion

Navigating the differences between Medicare Part A and B therapy coverage can feel complex, but the core distinction is the setting in which care is provided. Part A is for inpatient therapy as part of a hospital or skilled nursing facility stay, covering intensive, short-term recovery. Part B is for outpatient therapy, including ongoing treatment at clinics, offices, and even at home. Understanding these fundamental differences is key to ensuring you receive the proper care and managing your costs effectively.

For further details on your Medicare plan and services, you can visit the official Medicare website.

Frequently Asked Questions

Is physical therapy covered by Medicare Part A or Part B?

Physical therapy can be covered by both Medicare Part A and Part B. Part A covers physical therapy received as an inpatient in a hospital or skilled nursing facility. Part B covers physical therapy received as an outpatient, such as at a clinic or doctor's office.

Does Medicare cover in-home therapy services?

Yes, both Medicare Part A and Part B may cover in-home therapy. Part A can cover it as part of a home health care benefit after a hospital stay. Part B can also cover in-home therapy, often when you are not eligible for the home health benefit but are homebound and require skilled services.

What is the difference in costs for therapy under Part A versus Part B?

Under Part A, costs include a deductible per benefit period and potential daily coinsurance for extended inpatient stays. Under Part B, you must meet an annual deductible, and then you typically pay 20% of the Medicare-approved amount for each service.

Is there a limit on how many therapy sessions Medicare will cover?

For Original Medicare (Parts A and B), there is no longer a limit on how much Medicare will pay for medically necessary therapy services. However, if your costs exceed a certain threshold, your provider must confirm the medical necessity of your ongoing treatment for coverage to continue.

Does Medicare cover occupational and speech therapy?

Yes, Medicare covers occupational therapy (OT) and speech-language pathology (SLP) services. Like physical therapy, Part A covers these as inpatient services, and Part B covers them as outpatient services, provided they are medically necessary.

Can I receive therapy under both Medicare Part A and Part B at the same time?

Generally, no. If you are receiving inpatient therapy under Part A, you cannot receive therapy services under Part B during the same period. Services must be billed under the correct part based on your inpatient or outpatient status.

Does Medicare cover therapy in a psychiatric hospital?

Yes, Medicare Part A covers therapy services received during a stay in a psychiatric hospital. However, there is a lifetime limit of 190 days for such inpatient care in a specialized psychiatric facility.