X-rays
Plain x-rays of the knee are usually the only test (other than exam) necessary to diagnose most cases of degenerative arthritis. Usually there is no need for expensive testing with studies such as MRI to make this diagnosis...especially in it's more advanced stages. However, sometimes MRI or other testing may be helpful to determine the cause of the arthritis or to evaluate other issues.
Severe arthritis on x-rays is not always painful. In fact, sometimes a patient with terrible looking x-rays will really not be having much pain. A good doctor will usually treat the patient and NOT the x-rays, so if it is really not hurting much...then, sometimes no treatment may be needed even if the x-rays look pretty bad.
Other tests
If there is concern for rheumatoid arthritis or other systemic disease, some blood tests might be ordered. If the patient has an unusual history, other tests might be needed.
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