Medicare generally covers medically necessary rehabilitation after hip surgery, but coverage specifics depend heavily on the setting where care is received. Recovery from a total hip replacement requires a period of intensive physical and occupational therapy, often called “skilled care,” to safely restore mobility and function. This recovery phase is designed to prevent complications, rebuild muscle strength, and help the patient regain independence in daily activities. Understanding how Medicare structures benefits for inpatient versus outpatient care is crucial for predicting coverage duration and potential out-of-pocket expenses.
Understanding Post-Surgery Rehabilitation Settings
Post-hip surgery rehabilitation is structured into two main categories of care settings, each covered under different parts of Medicare. The initial, most intensive phase often takes place in an inpatient setting, providing round-the-clock medical supervision. These facilities include Skilled Nursing Facilities (SNFs) or, for highly complex cases, Inpatient Rehabilitation Facilities (IRFs), sometimes called acute care rehabilitation centers. Both settings are designed for short-term, comprehensive recovery immediately following a hospital stay.
Once the patient is stable, rehabilitation transitions to an outpatient environment for the longer-term recovery phase. This care is delivered through dedicated outpatient physical therapy clinics, a doctor’s office, or certified home health care agencies. Outpatient therapy focuses on continued strength building, flexibility improvement, and functional training to achieve maximal long-term recovery goals. The distinction between inpatient and outpatient settings determines which part of Medicare pays for the services.
Medicare Part A Rules for Inpatient Care
Medicare Part A, also known as Hospital Insurance, covers the costs associated with facility stays for immediate, intensive recovery following a hip procedure. To qualify for Part A coverage in a Skilled Nursing Facility (SNF), the patient must first meet the “three-day rule.” This rule requires a qualifying inpatient hospital stay of at least three consecutive days, not including the day of discharge.
The SNF admission must occur within 30 days of leaving the hospital, and the care must relate to the condition treated during the inpatient stay. The patient must require and receive “skilled care” daily. This involves services that can only be safely and effectively performed by a licensed professional, such as a registered nurse or a physical therapist. This often includes complex wound care, medication management, and daily physical therapy sessions.
Part A coverage is structured around a “benefit period.” A benefit period begins the day a patient is admitted as an inpatient and ends when the patient has not received inpatient hospital or skilled SNF care for 60 consecutive days. For each benefit period, Medicare Part A covers up to 100 days of skilled care in an SNF. The first 20 days of a covered SNF stay are paid in full by Medicare, after the patient meets the Part A deductible.
If the patient requires a higher level of intensive rehabilitation, they may be admitted to an Inpatient Rehabilitation Facility (IRF). IRF coverage is for patients needing close medical supervision and coordinated care from a multidisciplinary team. This requires at least three hours of combined physical and occupational therapy per day. Medicare covers the first 60 days of care per benefit period after the deductible is met, with the patient incurring daily coinsurance charges starting on day 61.
Medicare Part B Rules for Outpatient Therapy
Following discharge from the hospital or an inpatient facility, recovery continues with long-term rehabilitation covered under Medicare Part B, which is Medical Insurance. Part B covers medically necessary outpatient physical therapy (PT), occupational therapy (OT), and speech-language pathology services. These services are important for maximizing the functional gains achieved during the initial inpatient phase and fully restoring strength and mobility.
Outpatient therapy can be provided in various settings, including dedicated physical therapy clinics, a doctor’s office, or through a certified home health agency. For Part B to cover these services, the patient must have a doctor’s referral. The care must be part of a certified plan of care that is regularly reviewed by the physician. The therapist must document that the patient’s condition requires skilled services to improve or safely maintain function.
The concept of a “therapy cap,” which previously limited Medicare payments for outpatient therapy, was eliminated in 2018. There is now no annual limit on how much Medicare will pay for medically necessary outpatient therapy services. However, once the total cost of therapy reaches a certain threshold, the therapist must confirm that continued treatment remains medically necessary. Part B also contributes to the cost of durable medical equipment, such as a walker or cane.
Patient Financial Responsibility and Cost Sharing
While Medicare covers a substantial portion of post-hip surgery rehabilitation, beneficiaries are responsible for financial obligations depending on the service setting. Under Part A for an SNF stay, the patient pays nothing for the first 20 days within a benefit period, provided the Part A deductible has been met. From day 21 through day 100, a daily coinsurance amount is required, which is \$209.50 per day in 2025. After day 100 in a benefit period, the patient is responsible for all SNF costs.
For outpatient therapy covered under Part B, the patient must first satisfy the annual Part B deductible. After the deductible is met, the patient is generally responsible for a 20% coinsurance of the Medicare-approved amount for all physical therapy and occupational therapy services. Medicare pays the remaining 80% of the approved amount.
Many beneficiaries utilize supplemental insurance, such as a Medigap policy, to help cover these out-of-pocket costs. Medigap plans are designed to “fill the gaps” in Original Medicare by covering deductibles, copayments, and coinsurance amounts. Alternatively, patients enrolled in a Medicare Advantage Plan (Part C) receive benefits through a private insurer. Their cost-sharing structure may differ, typically involving fixed copays for services instead of the 20% coinsurance required by Original Medicare.