Does Medicare Pay for Medically Necessary Knee Surgery?

Medicare provides health coverage for millions of Americans, primarily those aged 65 and older, and certain younger individuals with disabilities. Understanding how Medicare addresses major medical procedures like knee surgery is important.

Overall Medicare Coverage for Knee Surgery

Medicare covers knee surgery when a physician determines it is medically necessary. This means the surgery is appropriate and essential for diagnosing or treating an illness, injury, or condition. Coverage applies to various knee procedures, from total knee replacement (arthroplasty) to less invasive arthroscopic procedures for repairing cartilage or ligaments. Medicare covers treatment required to improve a beneficiary’s health or functional ability, not for cosmetic purposes or convenience.

How Different Medicare Parts Cover Knee Surgery

Medicare’s structure involves several parts, each covering distinct aspects of healthcare services related to knee surgery.

Medicare Part A, Hospital Insurance, covers inpatient hospital stays. This includes costs for the hospital facility, such as the operating room, nursing care, meals, and a semi-private room, when knee surgery requires an overnight stay. Part A also covers care in a skilled nursing facility (SNF) for a limited time following a qualifying inpatient hospital stay.

Medicare Part B, Medical Insurance, covers services provided by doctors and other healthcare providers. This includes surgeon’s fees, anesthesiologist’s services, and other physician services during surgery, whether inpatient or outpatient. Part B also covers diagnostic tests, such as X-rays, MRI scans, and laboratory tests, performed before surgery. Durable medical equipment (DME), like walkers, crutches, or wheelchairs, prescribed by a doctor for use at home, also falls under Part B.

Medicare Part C, Medicare Advantage Plans, are offered by private insurance companies approved by Medicare. These plans must provide at least the same benefits as Original Medicare (Parts A and B), but often include additional benefits like prescription drug coverage. While Medicare Advantage plans cover knee surgery, they may have different rules, costs, and network restrictions compared to Original Medicare. Beneficiaries should review their specific plan details regarding referrals, prior authorizations, and in-network providers.

Medicare Part D provides prescription drug coverage. This part helps cover the costs of medications prescribed before, during, and after knee surgery, such as pain relievers, antibiotics, or anti-inflammatory drugs. Coverage for specific drugs and their costs varies by plan, so check the plan’s formulary.

Patient Costs for Knee Surgery

Even with Medicare coverage, beneficiaries are responsible for certain out-of-pocket costs for knee surgery. These costs include deductibles, coinsurance, and copayments, which vary depending on the Medicare part and plan.

Under Original Medicare, the Part A deductible applies to each benefit period for inpatient hospital stays. For 2025, this deductible is $1,688 per benefit period. If a hospital stay extends beyond 60 days in a benefit period, a daily coinsurance amount applies, increasing after 90 days.

For services covered under Part B, an annual deductible must be met before Medicare pays its share. The Part B deductible for 2025 is $240. After this deductible is satisfied, beneficiaries pay 20% of the Medicare-approved amount for most doctor’s services, outpatient therapy, and durable medical equipment. There is no annual out-of-pocket maximum under Original Medicare Part A and Part B.

Medicare Advantage plans have different cost-sharing structures. These plans often feature their own deductibles, copayments for doctor visits or services, and coinsurance percentages, which can vary from Original Medicare. Medicare Advantage plans are required to include an annual out-of-pocket maximum, limiting the total amount a beneficiary pays for covered services in a calendar year. Once this maximum is reached, the plan pays 100% of covered services for the remainder of the year.

Many beneficiaries purchase Medigap, or Medicare Supplement Insurance, policies to help cover some of the out-of-pocket costs not paid by Original Medicare. These policies can help pay deductibles, coinsurance, and copayments, reducing a beneficiary’s financial responsibility for services like knee surgery. Medigap policies are standardized, meaning the benefits for each plan type (e.g., Plan G) are the same regardless of the insurance company.

Conditions for Medicare Coverage

For Medicare to cover knee surgery, specific conditions must be met. A qualified physician must document that the surgery is medically necessary to treat a diagnosed illness, injury, or condition affecting the knee, and that the procedure is an accepted medical practice.

The surgery must be ordered by a licensed physician enrolled in Medicare. It must also be performed by Medicare-approved providers and in Medicare-certified facilities, such as hospitals or outpatient surgical centers. These facilities and providers must meet federal health and safety standards to participate in Medicare.

Some procedures or services, especially under Medicare Advantage plans, may require prior authorization or pre-approval from the plan. The plan needs to review and approve the medical necessity of the surgery before it is performed for coverage to be assured. Failure to obtain prior authorization could result in the service not being covered, leading to higher out-of-pocket costs.

Coverage for Post-Surgery Recovery

Medicare provides coverage for various services to aid in rehabilitation after knee surgery. These services help regain strength, mobility, and function.

Physical therapy (PT) and occupational therapy (OT) are covered by Medicare when medically necessary. Outpatient PT and OT services are covered under Medicare Part B, helping beneficiaries improve movement, reduce pain, and perform daily activities. If therapy is provided during an inpatient hospital stay or a covered skilled nursing facility stay, it falls under Part A.

Skilled nursing facility (SNF) care is covered by Medicare Part A for short-term, medically necessary stays following a qualifying inpatient hospital admission. This coverage is for skilled nursing care or therapy services that can only be provided in a SNF setting. To qualify, a beneficiary must have had an inpatient hospital stay of at least three consecutive days, and the SNF care must be for a condition treated during the hospital stay.

Home health care services, including intermittent skilled nursing care, physical therapy, occupational therapy, and speech-language pathology services, are covered by Medicare Part A or Part B. These services are for beneficiaries who are homebound and require skilled care on a part-time or intermittent basis. This allows for medical and therapeutic support at home.

Durable medical equipment (DME), such as crutches, walkers, or wheelchairs, is covered under Medicare Part B when prescribed by a doctor for use at home to aid in recovery. Medicare pays 80% of the Medicare-approved amount for DME after the Part B deductible is met, with the beneficiary responsible for the remaining 20%.