Does Medicare Cover Ketamine Treatment?

Ketamine, a medication initially recognized for its anesthetic properties, has expanded its medical applications, particularly in mental health and pain management. This article clarifies how Medicare, the federal health insurance program for individuals aged 65 or older and certain younger people with disabilities, covers ketamine treatments.

Ketamine Coverage Across Medicare Parts

Medicare’s structure involves different parts, each with specific coverage rules for ketamine treatment. Original Medicare includes Part A (Hospital Insurance) and Part B (Medical Insurance), while Part D covers prescription drugs. Medicare Advantage Plans (Part C) combine these benefits and are offered by private companies.

Medicare Part A primarily covers inpatient hospital care. If ketamine is administered as part of a Medicare-covered inpatient hospital stay, such as for anesthesia during surgery, it is covered under Part A. This coverage is integrated into the overall inpatient benefit, meaning it is not a separate charge but part of the hospital services.

Medicare Part B covers medically necessary services and treatments received in an outpatient setting, including physician services and outpatient hospital care. This part covers ketamine if it is medically necessary and administered by a Medicare-approved healthcare provider. Physician-administered intravenous (IV) ketamine, when used as an anesthetic in an outpatient setting like an emergency room, can be covered by Part B. Esketamine (Spravato), an FDA-approved nasal spray for treatment-resistant depression and major depressive disorder with suicidal ideation, is also covered.

Spravato is covered under Medicare Part B when administered in a certified healthcare facility under medical supervision. It requires careful monitoring for potential side effects, such as dizziness or increased blood pressure, for at least two hours post-administration. Doctors must purchase and administer the drug in a medical setting, which aligns with Part B’s coverage for services provided in a clinic or doctor’s office. Part B covers both the drug and its administration, provided all conditions are met.

Medicare Part D plans cover prescription drugs filled at a pharmacy for self-administration. While IV ketamine and esketamine (Spravato) are covered under Part B due to administration requirements, other self-administered forms of ketamine may fall under Part D. This is less common for Medicare coverage, as most medically recognized ketamine treatments require professional oversight. Part D plans operate with formularies, which are lists of covered drugs, and may require prior authorization for certain medications.

Medicare Advantage Plans (Part C) are offered by private insurance companies approved by Medicare. These plans provide at least the same level of coverage as Original Medicare Parts A and B, but may offer additional benefits and have different rules, costs, and networks. Coverage for ketamine treatment under a Medicare Advantage plan follows the plan’s specific guidelines, which must align with or exceed Original Medicare’s coverage. Coverage for treatments like esketamine can vary among different Medicare Advantage plans and may require prior authorization.

Criteria for Medicare-Covered Ketamine Treatment

For Medicare to cover ketamine treatment, specific conditions and requirements must be met. The overarching principle is medical necessity, meaning a healthcare provider must deem the treatment necessary for diagnosing or treating a covered illness or injury. This determination is essential for any service or medication to be considered for Medicare coverage.

A primary consideration for Medicare coverage is the Food and Drug Administration (FDA) approval status for the specific use of ketamine. Ketamine is FDA-approved as a general anesthetic. Medicare covers ketamine when used for anesthesia during medically necessary procedures. Medicare does not cover off-label uses of ketamine, such as IV ketamine infusions for mental health conditions or chronic pain, because these uses are not FDA-approved.

An exception to this off-label policy is esketamine (Spravato), an FDA-approved nasal spray for treatment-resistant depression and major depressive disorder with suicidal ideation. For Spravato to be covered, patients must have a diagnosis of treatment-resistant depression or major depressive disorder and have previously tried and failed at least two traditional antidepressant medications. The treatment must be prescribed and administered by a certified provider within a Risk Evaluation and Mitigation Strategy (REMS) certified healthcare facility.

The setting in which the treatment is administered is a significant factor for Medicare coverage. Ketamine treatments, particularly esketamine, must be provided in an appropriate, licensed, and Medicare-approved facility. This requirement ensures patient safety due to the need for direct supervision by a qualified healthcare professional during and immediately after administration.

Prior authorization is required for many ketamine treatments, especially for esketamine (Spravato). This process involves the healthcare provider submitting documentation and medical records to Medicare or the Medicare Advantage plan for approval before treatment begins. The documentation must clearly demonstrate the medical necessity of the treatment, the patient’s diagnosis, and that all specific criteria, such as prior failed treatments, have been met. Without proper prior authorization, coverage may be denied, leaving the patient responsible for the full cost.

Patient Costs for Ketamine Treatment

Even when Medicare covers ketamine treatment, beneficiaries will incur out-of-pocket costs, which vary depending on the specific Medicare part and the type of treatment received. These costs involve deductibles, coinsurance, and copayments that patients are responsible for paying.

For ketamine administered during an inpatient hospital stay covered by Medicare Part A, patients are responsible for a deductible per benefit period. In 2025, the Part A deductible is $1,676. After meeting this deductible, patients may pay nothing for eligible inpatient services for the first 60 days of a benefit period. Beyond this, coinsurance amounts apply for extended stays.

Under Medicare Part B, which covers outpatient services including ketamine infusions and esketamine (Spravato) administration, patients are subject to a deductible and coinsurance. For 2025, the Part B deductible is $257. After this deductible is met, Medicare covers 80% of the Medicare-approved amount for covered services, leaving the patient responsible for the remaining 20% coinsurance. For Spravato, this 20% coinsurance applies to both the drug and the associated clinical monitoring.

For any ketamine product covered under a Medicare Part D prescription drug plan, out-of-pocket costs can vary based on the plan’s formulary and benefit design. These costs may include an annual deductible, copayments, or coinsurance for covered prescriptions. Part D plans also have different coverage phases, such as the initial coverage phase, coverage gap (donut hole), and catastrophic coverage, which can impact a patient’s financial responsibility throughout the year.

Medicare Advantage Plans (Part C) have their own cost-sharing structures, which can differ from Original Medicare. Patients in these plans may have specific copayments, deductibles, and out-of-pocket maximums set by their private insurer. While these plans must cover at least what Original Medicare covers, the exact copay for a service like esketamine may involve a fixed amount or a percentage-based coinsurance. Consult the specific plan’s benefit details to understand these costs.

Medigap, or Medicare Supplement Insurance, helps cover some of the out-of-pocket costs associated with Original Medicare Parts A and B. These plans can pay for deductibles, copayments, and coinsurance, reducing a beneficiary’s financial burden for covered ketamine treatments. A Medigap policy can significantly lower or even eliminate the 20% coinsurance required under Part B, potentially covering 100% of the cost for medically necessary services after the Part B deductible is met.

If ketamine treatment is not covered by Medicare—for instance, if it’s considered an off-label use or if medical necessity criteria are not met—the patient will be responsible for 100% of the cost. For IV ketamine infusions for conditions like chronic pain or mental health not involving esketamine, costs can range from $400 to $1,200 per session, with an initial series potentially costing $2,000 to $6,000 or more, all out-of-pocket.