Medicare can cover inpatient or outpatient prostate surgery. Typically, outpatient hospital stays are less than 24 hours. If an outpatient observation service lasts longer than 24 hours, you must get a Medicare Outpatient Observation Notice (MOON). What you pay as an inpatient or outpatient may be different.    Medicare Part A covers your inpatient hospital stay. Medicare Part B covers doctor services that may include prostate surgery.