Does Health Insurance Cover Occupational Therapy?

Occupational therapy helps people regain life skills lost through injury or illness. So, health insurance should cover it, right? Yes, most health plans do cover it – but how they do so can vary widely.

occupational therapy health insurance coverage

Every year, millions of Americans of all ages take part in some form of occupational therapy.

Considering how common this kind of treatment is these days, it begs the question: do US health insurance plans cover it?

Almost all insurance plans offer some form of occupational therapy. However, insurance companies usually require a physician’s referral. In other words, your occupational therapy needs to be ‘medically necessary’ for insurance to cover it.

That’s just part of the story here, though. Even though most health plans cover this type of care, there are many different approaches.

For example, some plans only cover specific forms of occupational therapy. Others only cover it when it’s provided in certain settings. And nearly all limit how many hours, days, or visits they’ll cover.

You’ll learn more about each of these aspects of occupational therapy coverage in this article as well as:

  • How specific types of health plans cover occupational therapy
  • Whether insurance companies or policies specialize in covering occupational therapy
  • The many different limits and restrictions US health insurance policies put on this coverage
  • How much occupational therapy costs if you don’t have health coverage
  • What to do if your health plan won’t pay for the occupational therapy you need

What is Occupational Therapy?

Before we tackle how and when health insurance tends to cover this kind of care, lets define occupational therapy.

It’s important to get that out of the way because although most Americans know what physical therapy is and why it’s needed, the same can’t be said of occupational therapy. If you don’t know the difference between the two, scroll down to the end of this article. You’ll learn all about it there.

Basically, the main point of occupational therapy is to “help people across the lifespan to do the things they want and need to do.” In many cases, that includes regaining skills they lost because of an injury or illness so they can lead normal lives.

Along those lines, the exercises most often tied to this sort of therapy usually focus on “activities of daily living” like:

  • Bathing
  • Dressing
  • Feeding
  • Personal hygiene
  • Other forms of self-care

In some cases, though, occupational therapy goes beyond those basics. For instance, it isn’t unusual for it to help people with these skills, too:

  • Cooking
  • Driving
  • Housekeeping
  • Gardening

There are a wide range of activities that occupational therapy can address. Some sessions even focus on things like balancing a checkbook or keeping a schedule. Occupational therapists also:

  • Train patients how to use “assistive devices” (like jar openers, key holders, and reachers)
  • Fit them with braces or splints
  • Evaluate their home and work environments and suggest changes that could aid their recovery

As mentioned earlier, many people need occupational therapy after a health condition. Here are some conditions that can require a visit to an occupational therapist, according to cigna.com:

  • Stroke, heart attack, or amputation
  • Multiple sclerosis, chronic obstructive pulmonary disease (COPD), or arthritis
  • Alzheimer's disease, post-traumatic stress disorder, or other mental or behavioral issues
  • Mental or physical impairments someone has had since birth

All sorts of injuries can prompt a need for this therapy, too.

How Do Different Types of Health Insurance Plans Cover Occupational Therapy?

Here’s how specific plan types treat occupational therapy.

Job-based health insurance policies

If you get your health coverage from an employer (yours or your spouse’s) you’re in luck. Most of these policies will help you pay for at least some forms of occupational therapy.

They likely won’t pay for all forms of it, though. And they’ll require a physician to prescribe the forms they do cover.

Expect any employer-sponsored or job-based health plan you’re offered to tie other requirements to occupational care coverage, too.

An example: for insurer Aetna to cover occupational therapy, it must be “medically necessary.” What does that mean? The therapy has to help a person learn or relearn daily living skills. They define that as “significantly improve, develop, or restore physical functions lost or impaired as a result of a disease, or injury.”

Aetna will cover this kind of therapy if it’s “for the specific purposes of designing and teaching a maintenance program for the patient to carry out at home.”

It won’t cover it, however, if it’s “of a palliative nature.” That means it can’t just relieve pain; it must treat a specific condition. And it can’t be “provided for maintenance of the patient’s status.” In other words, it has to help the patient improve in some area. The company states that it’s not necessary “for members whose condition is neither regressing nor improving.”

On top of that, the therapy must be performed “in accordance with an ongoing, written plan of care that is reviewed with and approved by the treating physician.” And “there must be a reasonable expectation that a member’s condition will improve significantly in a reasonable and generally predictable period of time” as well.

Finally, Aetna says this therapy needs to “be of the level of complexity” that only an occupational therapist (or doctor) can perform it. Otherwise, they won’t cover it.

Aetna is hardly unique in this regard. Other health insurance companies restrict occupational therapy coverage in similar ways. Humana, for instance, says it’ll only pay for this type of care if it “meets medical necessity guidelines.” It also requires prescriptions or referrals and limits the number of visits or sessions a patient can receive.

On top of that, even when your job-based health plan covers occupational therapy, you’ll still have to deal with copayments or coinsurance costs.

If it’s important to you to have health insurance that covers occupational therapy, carefully review any job-based plan offered to you. And if the documentation provided to you doesn’t make it clear, ask the employer. Or contact the insurance company behind the policy and ask someone there.

Most employer-sponsored health plans cover occupational therapy, but they often do so in such different ways that you shouldn’t assume they’re all the same.

Marketplace and off-marketplace policies

As you may know, the Affordable Care Act provides coverage for people who can’t get it elsewhere. (Like from an employer.)

But that’s not all the 2010 law, also called the ACA or Obamacare, did. It also requires health plans to cover 10 categories of services known as “essential health benefits.”

One of the 10 categories of services policies must cover: rehabilitative and habilitative services and devices.

These services and devices help people “keep, learn, or improve skills and functioning for daily living,” according to healthcare.gov.

That doesn’t mean all health insurance plans will pay for every form of occupational therapy. It also doesn’t mean they’ll all pay for this kind of care indefinitely.

As is the case with health coverage you get from an employer, marketplace coverage can be all over the board in this area. Why? States have some freedom when it comes to designing their “benchmark” plans. These plans serve as a model for what other plans sold in that state must cover.

Still, the policies you find on the marketplace do need to cover occupational therapy in some form. You know what that means: shop around. Look at a few different plans before you settle on one. And don’t just look at what they cover; look at how they cover it, too. Compare the copayments or coinsurance amounts they charge whenever you go to see your therapist.

And if you have questions, don’t be shy about picking up the phone or sending off an email.

Looking for this kind of coverage? Read this article of ours--”Which Type of Obamacare Plan is Right for You?

Medicaid

The federal government gives states some leeway when it comes to deciding how Medicaid cover occupational therapy. Unlike marketplace plans, Medicaid programs don’t have to pay for this type of therapy if they don’t want to.

That’s because, as medicaid.gov points out, federal law requires states provide certain “mandatory” benefits. While many benefits are mandatory, occupational therapy is optional. As a result, many state Medicaid programs don’t pay for occupational therapy under any circumstances.

Also, most programs that do pay for it restrict that coverage in various ways. Some limit the number of visits. Others even limit how much time someone can spend in a therapist’s office.

Don’t be surprised if your state’s Medicaid program has to approve any trips to an occupational therapist. And expect it to check in on how things are going now and then, too. It isn’t unusual for states to review treatment or care plans on occasion.

The good news: if you qualify for Medicaid and your program covers occupational therapy, you won’t have to pay much out of your own pocket. Most states that tie a copayment to this type of care charge very little for it. A few dollars per session, at most.

How can you find out if your state program covers occupational therapy? Contact your local Medicaid agency.

Medicare

In general, Original Medicare, or Medicare Part A and Part B, does a much better job than Medicaid of covering occupational therapy.

Actually, it does a better job than almost every other form of health insurance coverage.

How so? Medicare doesn’t tie this sort of coverage to ongoing improvement. So, it’ll keep paying even if you hit a plateau in your recovery. That’s unusual. Many job-based, marketplace, and off-marketplace health plans require you to keep showing progress if you want them to continue covering your therapy sessions.

Original Medicare often puts fewer limits on this kind of coverage than other plan types, too.

If you’re on Medicare and need occupational therapy, you’ll probably rely on Part B to cover it. As long as it’s medically necessary, Medicare Part B covers sessions in a number of settings. A few examples: private practices, hospital outpatient clinics, and skilled nursing facilities. It may even pay for you to receive this kind of care in your own home.

Part B only assists in those last two settings after your Part A coverage runs out. (Medicare Part A focuses on care provided during inpatient hospital stays. Or stays in rehabilitation facilities, like skilled nursing homes. It also pays for some home care after you leave either of those settings.)

The best aspect of Original Medicare coverage of occupational therapy is how cheap it is. Besides your Part B premium, all you pay is your deductible and 20 percent of the Medicare-approved amount. Medicare Part B pays 80 percent of the cost of your therapy once you hit your deductible.

If that’s too much for you, consider buying Medicare Supplement insurance. As its name suggests, this product supplements your Medicare coverage by filling in its gaps. (Which is why some people call it Medigap or MedSup coverage.)

In this case, that means it’ll pay any out-of-pocket costs that may be tied to your occupational therapy sessions.

To learn more about MedSup or Medigap, read our article, “When Does it Make Sense to Get a Medicare Supplement Plan?” Also, learn more on Medicare Parts A and B in our “Ultimate Guide to Medicare.”

Which Insurance Companies Specialize in Occupational Therapy?

Wondering which insurance companies offer policies that focus on covering occupational therapy?

Unfortunately, the answer is none. That’s not a big deal, though. Pretty much every type of health insurance covers occupational therapy – to an extent.

One of the only exceptions, as mentioned earlier, is Medicaid. Some state Medicaid programs won’t pay for this kind of care no matter your situation. Still, more of them cover it than don’t.

More important than finding a health plan that covers occupational therapy at all is finding one that covers it in such a way that it meets your specific needs in this area. And to do that, you need to shop around and compare policies and quotes from several insurance companies.

How Much Does Occupational Therapy Cost?

Even if you have health insurance, visiting an occupational therapist probably won’t be free. In most cases, you’ll have cover a copay or a percentage of the overall cost of each session.

Still, that’s sure to be a better deal than paying for the whole thing out of your own pocket.

So, what do you have to pay for occupational therapy if you don’t have health insurance? (Or if your health plan doesn’t cover it.)

According to various sources, an initial evaluation can cost around $200. After that, individual occupational therapy sessions may cost between $40 and $200 (or more) per visit.

What you pay per session depends on a few factors. Some of them include:

  • Where you live or where you go to receive the therapy
  • The setting (hospitals and rehabilitation facilities charge more than private clinics)
  • The type of service or treatment you need

You may have to pay for more than just therapy sessions as you work to regain or relearn life skills after an illness or injury. You may have to buy one or more “assistive devices” to aid your recovery as well.

Some of them, like jar openers or key holders, tend to be cheap. Others, like shower benches, arm or leg splints, or reachers (to grab things), can be more expensive.

What Can You Do if Your Health Plan Won’t Pay for the Occupational Therapy You Need?

If your health insurance won’t pay for this kind of care, talk with your doctor or physician. If they believe you need occupational therapy to relearn or regain certain skills, they may be able to help.

They can provide support for the next step in this process, which is to contact your insurance company. Explain your situation to them. Tell them why you need this type of therapy. Offer to connect them with the doctor or physician who prescribed it.

If none of that works, look into filing an appeal with the insurer. You might even be able to have a third party review their decision. To learn more about this process, see our article on “How to Appeal a Health Insurance Claim Denial.”

Frequently Asked Questions

Q: Is occupational therapy the same as physical therapy?

A: These two types of therapy are not the same. Although they both help people rehabilitate from injuries or illnesses, they go about it in different ways.

According to St. Catherine University, the main difference between them is:

  • Occupational therapy “focuses on improving a client’s ability to perform activities of daily living”
  • Physical therapy “focuses on improving a client’s ability to perform movement of the human body”

What to know more about the latter? Read our article about health insurance and physical therapy.

Q: How can I tell if my health insurance plan covers occupational therapy?

A: If you haven’t done so already, pull out your policy and look it over. And if you don’t have a physical or printed document you can review, go on line. You should be able to find a digital copy of your policy on the insurance company’s website.

There’s a good chance that won’t offer much assistance. After all, insurance policies aren’t known for being easy to read or understand. So, if you’re still stumped after looking over your policy, call the insurer. Or email them. Or head to their website and chat with someone in customer service.

Any of those tactics should help you figure out if your plan covers this kind of therapy, when it covers it, and how much or how long it covers it.

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