Insurance Verification for Rented DME items

April 25, 2016

Insurance Verification for Rented DME items

Durable Medical Equipment (DME) can be categorized as any piece of equipment that can provide relief or benefits (therapeutic) to a patient. Moreover, as the name signifies, the equipment is expected to withstand continuous usage. There are certain types of DME that may be required for a relatively shorter period of time, and it makes sense to rent such equipment rather than buy them. Insurance companies reimburse the cost of such rented items, which is called capped rental.

When a physician decides that a patient needs to go for rented DME, the patient need not worry about shipping and installing the equipment as the costs for the same along with handling, setting up, labor, repairs and maintenance are paid for by the insurance companies. However, there is a stipulation that the durable medical equipment supplier needs to meet eligibility criteria in addition to credentialing. As long as DME comes under insurance coverage it is taken to be part of the patient's DME benefits.

Here are a few billing requirements for durable medical equipment:

  • In order for DME to be rented or purchased, it has to be prescribed to make it eligible for coverage.
  • There are few items of DME that can only be rented and cannot be purchased; these are listed under 'capped rentals'.
  • Some DME items need to be rented first before you can convert them to purchasable DME, as per policy.
  • Billing has to be done on a typed CMS-1500 claim form (version 08/05)
  • The applicable modifier has to be billed after all Healthcare Common Procedure Coding System (HCPCS) codes that include NU, RR and more.
  • After the procedure code, the maintenance and repair modifier codes need to be billed.
  • While submitting any claims for repairs, detailed description of services needs to be included.
  • Factory invoice for the DME needs to be submitted along with the initial claim. A physician's certificate (duly appended with signature) of medical necessity also needs to be included.
  • All initial claims need to be submitted as hard copy (on paper) along with all other relevant documents related to the DME being rented or purchased.
  • All additional documentation has to be on paper, and cannot be submitted/transmitted electronically.


Services that do not have prior authorization (certification number) will be subject to medical review. In order for the medical review to take place certain conditions have to be fulfilled, they are:

  • The plan of treatment adopted by the physician, including for how long the prescribed DME will be required.
  • The therapeutic benefits and outcomes that can be expected through the treatment prescribed by the physician.
  • The use of the prescribed DME item has to be supervised by the physician who prescribes it.
  • The medical necessity for using the DME to be established through the description of the patient's status.
  • The durable medical equipment that is to be rented or purchased has to have a prescription, only then it will be covered by insurance.
  • Coverage will commence right from the day the DME is installed and certified as ready to use.
  • The reimbursement amount has to include charges for shipping, handling, setting up and cannot be claimed separately.

Certain billing requirements for renting DME need to be fulfilled, which include adding the modifier code in the claim forms. The approximate period the DME is going to be rented for needs to be specified (commencement and ending dates). The modifier 'RR' needs to be included on the claim form for items being rented. When a claim is submitted without the modifier 'RR' it will be considered as a purchase. Rental charges have to be for a 30-day period, unless specified as daily.


Category : Accounts Receivables / Claims Denials