Recent Policy development for Durable Medical Equipment (DME) Billing

The US Healthcare industry in its true sense is passing through a transition period, where each medical specialty is waiting on the fence, to find out if there is any further development to their current regime. In those specialties, the Durable Medical Equipment suppliers are also looking for information and updates that would normalize their business, streamline the revenue cycle and are hands-on with their DME billing and coding procedures.

The use of durable medical equipment in the home, while not a recent development, was formally recognized by the Congress with the passage of the original Medicare legislation. Since that time the statute has been amended to provide for a more workable, economical, and desirable interface among the administrative, supplier, and user communities.

So with regards to renting, purchasing or repairing and maintenance of Durable Medical equipment here are some developments you should keep in mind for perfect reimbursement.

Durable medical equipment billing recent policy developments:

  • As a thumb rule, DME requires a prescription to rent or purchase, as applicable, before it is eligible for coverage.
  • Certain items must be rented and may not be purchased (under “Capped Rentals”). Certain other items must be rented prior to being converted to purchase in accordance latest DME billing developments.
  • Medical Billers need to charge the applicable modifier after all HCPCS codes.
  • As a DME biller, you need to charge maintenance and repair modifier codes first after the procedure code.
  • Submit all claims for repairs with a complete description of services provided.
  • Always submit a complete description of the item.
  • With the initial claim, submit a factory invoice for the item (catalogs and retail price listings are not acceptable) and, if appropriate, a certificate of medical necessity form with the physician’s signature. Though this is not a recent development, don’t follow this procedure, and stand to lose reimbursement.
  • Do not staple this documentation to the claim form; also check HER or EMR prerequisites.
  • Submit all initial claims on paper to ensure that the appropriate documentation is received in the same envelope.
  • The additional documentation cannot be transmitted with electronically submitted claims.

 Durable Medical Equipment Guidelines for renting

DME rental against purchase coverage is based on the article prescribed, the patient’s prognosis, the time frame required for use, and the total cost (rental vs. purchase) for the equipment.

Remember that when DME is rented, the benefits cannot exceed the total of the cost to purchase the DME or the contracted fee schedule. This is one vital DME billing recent development policy.  Items that are considered to be a capped rental will be rented up to the allowed amount for purchase.

Durable Medical Equipment may be rented when: (Point to remember for the DME suppliers)

  • DME is not classified as “Routinely Purchased DME” (costing more than $200) or “Inexpensive DME” and anticipated medical need is for a limited time frame, or if the equipment requires high maintenance (i.e., requires specialized skills to service the item).

DME Billing requirements for Rentals

  • Always include modifier code on rental claim forms.
  • Indicate the beginning and ending dates of the rental period.
  • Always include the modifier “RR” in the first modifier location of field 24D on claims for rented items. Items filed without the “RR” modifier and without the rental dates will be considered as purchases and will be reimbursed accordingly.
  • Only bill for services already provided to a member.
  • Bill every 30 days of rental as one unit unless classified as a daily rental.
  • If an item is still being rented at the time of the claim, the claim must include the beginning date of the rental and indicate the last day of the billing cycle as the ending date of service.

Though with the ICD 10 transition, there is lots more development to look after, it should more or less be the work of your accounts department, rather than you (owner) have to dig deep into the new developments. As of now, the smooth passage of the new federal health care policy is what everybody is looking at. Is it good or bad for the DME, along with the overall healthcare industry is anybody’s guess?