Medicare covers medically necessary rehabilitation in several settings. The correct benefit depends on the intensity of care, the setting, the person’s medical needs, and whether Medicare’s provider and certification requirements are met.
Inpatient rehabilitation
Part A covers medically necessary care in an inpatient rehabilitation facility when a provider certifies that the person needs intensive rehabilitation, continued medical supervision, and coordinated care. Covered services can include physical, occupational, and speech therapy, nursing, a semiprivate room, meals, drugs, and hospital supplies. Part B covers eligible professional services from doctors and other providers during the stay.
Skilled nursing, outpatient, and home rehabilitation
Part A may cover rehabilitation in a skilled nursing facility after a qualifying inpatient hospital stay when daily skilled care is required. Coverage is limited to 100 days per benefit period and has additional requirements.
Part B covers medically necessary outpatient physical therapy, occupational therapy, and speech-language pathology. There is no fixed annual dollar limit on medically necessary outpatient therapy, but Medicare may review records when spending reaches specified thresholds. Eligible therapy can also be delivered through the home health benefit when the homebound and skilled-care requirements are met.
Coverage is not limited to cases in which improvement is expected. Skilled therapy can be covered when needed to maintain function or prevent or slow deterioration. The service must still require the skills of a qualified therapist.
Costs and Medicare Advantage
Part A inpatient deductibles and daily coinsurance can apply. For outpatient Part B therapy, the Part B deductible and 20 percent coinsurance generally apply when the provider accepts assignment. Medicare Advantage plans must cover Medicare-covered rehabilitation but may use networks, copayments, and prior authorization.
What to do next
- Ask the provider which rehabilitation setting is medically required and which Medicare benefit will be billed.
- Confirm inpatient or observation status before relying on skilled nursing facility coverage.
- Verify facility certification and plan network status.
- Request written notice and appeal information if coverage is ending.
- Review Medicare’s pages on inpatient rehabilitation and physical therapy.
Sources
- Medicare: Inpatient rehabilitation care
- Medicare: Physical therapy services
- Medicare: Skilled nursing facility care
Coverage and costs can change each calendar year. Check current Medicare rules and current plan documents before receiving care. A provider’s estimate is not a Medicare coverage decision. Final payment depends on the claim and the applicable coverage requirements.
Last reviewed: August 2026. Medicare rules and plan benefits can change.