Does Medicare Pay for Total Knee Replacement?

Total knee replacement is a significant medical procedure, and understanding Medicare coverage is a common concern. Medicare generally covers it when medically necessary. The extent of coverage and costs depend on the type of Medicare plan: Original Medicare (Parts A and B) or a Medicare Advantage Plan (Part C). This article explores Medicare coverage for total knee replacement, including the roles of various Medicare parts, approval requirements, patient financial responsibilities, and post-surgical care.

Medicare Parts and Total Knee Replacement Coverage

Medicare’s structure dictates coverage for total knee replacement components. Original Medicare is divided into Part A, which primarily covers inpatient services, and Part B, which addresses outpatient and professional services. Medicare Advantage Plans, offered by private insurers, consolidate these benefits.

Medicare Part A, known as Hospital Insurance, covers inpatient hospital stays, including the operating room, nursing care, and medications administered during hospitalization for a total knee replacement. Part A is the primary payer for these facility-related costs if the surgery requires an overnight stay.

Medicare Part B covers services from doctors and other healthcare providers. This includes the surgeon’s fees for performing the knee replacement, the anesthesiologist’s fees, and outpatient services such as diagnostic tests conducted before or after the surgery. If a total knee replacement is performed in an outpatient setting, Part B would also cover the facility costs.

Medicare Advantage Plans (Part C) are offered by private companies approved by Medicare. These plans cover at least the same services as Original Medicare Parts A and B, including total knee replacement. However, Medicare Advantage Plans often have their own rules regarding referrals, network providers, and cost-sharing, which can vary significantly. Beneficiaries should consult their plan documents for coverage details.

Requirements for Coverage Approval

For Medicare to cover total knee replacement, the procedure must be medically necessary. A healthcare provider makes this determination based on established medical guidelines. Medical necessity means services are needed to diagnose or treat an illness, injury, or condition, and meet accepted medical standards.

Common conditions necessitating total knee replacement include severe osteoarthritis, rheumatoid arthritis, or significant pain and functional limitations unresponsive to conservative treatments. Medicare guidelines often require evidence of advanced joint disease (e.g., X-rays, MRI) and documented unsuccessful non-surgical therapies. Conservative treatments include pain relievers, anti-inflammatory medications, physical therapy, weight loss, or assistive devices. A documented trial of at least three months of conservative therapy is typically expected before surgery.

Prior authorization may be required by Medicare or Medicare Advantage plans before surgery. This step ensures the procedure meets medical necessity criteria. Failure to obtain prior authorization could result in reduced coverage or denial of payment. The patient’s doctor documents medical necessity and submits required information to Medicare or the Medicare Advantage plan for approval.

Patient Financial Responsibilities

Even with Medicare coverage, beneficiaries incur out-of-pocket costs. These vary by Medicare plan. Original Medicare costs include deductibles and coinsurance.

For inpatient hospital stays covered by Medicare Part A, beneficiaries pay a deductible per benefit period. In 2025, the Part A inpatient hospital deductible is $1,676. This deductible covers the beneficiary’s share of costs for the first 60 days of Medicare-covered inpatient hospital care in a benefit period. For longer stays, daily coinsurance amounts apply, such as $419 per day for days 61 through 90 and $838 per day for lifetime reserve days in 2025.

Medicare Part B has an annual deductible, which is $257 in 2025. After this deductible is met, beneficiaries typically pay 20% of the Medicare-approved amount for most doctor’s services, outpatient care, and durable medical equipment. There is no annual out-of-pocket maximum with Original Medicare.

Medicare Advantage Plans have different cost-sharing structures, including copayments and an annual out-of-pocket maximum. In 2025, the maximum out-of-pocket limit for in-network services in Medicare Advantage plans is $9,350. These plans may also require beneficiaries to pay their Part B premium ($185 per month for most in 2025). Medigap policies (Medicare Supplement Insurance) can help cover some out-of-pocket costs, such as deductibles and coinsurance, not paid by Original Medicare.

Post-Surgical Care Coverage

Following total knee replacement, Medicare covers necessary care and rehabilitation for recovery. These services help patients regain strength, mobility, and independence. Coverage for post-surgical care is primarily through Medicare Parts A and B, depending on the setting.

Physical therapy (PT) is important for recovery. Inpatient physical therapy is covered by Part A if part of a skilled nursing facility (SNF) stay meeting Medicare criteria. Outpatient physical therapy services, in a clinic or hospital outpatient department, are covered by Medicare Part B. After meeting the Part B deductible, Medicare typically covers 80% of the approved amount for outpatient therapy services.

Skilled nursing facility (SNF) stays are covered by Medicare Part A if certain conditions are met, such as a qualifying inpatient hospital stay of at least three consecutive days before SNF admission. For SNF stays, Medicare covers the first 20 days at no cost. For days 21 through 100, a daily coinsurance of $209.50 applies in 2025. Beyond 100 days in a benefit period, the beneficiary is responsible for all costs.

Home health care services can also be covered by Medicare Part A or Part B for homebound individuals requiring skilled care (e.g., skilled nursing, therapy) in their home. This includes physical therapy, occupational therapy, or skilled nursing visits. For covered home health services, beneficiaries generally pay nothing, though the Part B deductible and 20% coinsurance may apply to durable medical equipment provided as part of home health.

Durable Medical Equipment (DME), such as walkers, crutches, or hospital beds, needed after surgery, is generally covered under Medicare Part B. Medicare typically pays 80% of the approved amount for these items after the Part B deductible is met, if prescribed by a Medicare-enrolled doctor for home use.