Medicare & Insurance Guide
Both Medicare and private health insurance plans pay for a large portion or even all of many types of medical equipment used in the home. This type of equipment is referred to as durable medical equipment or home medical equipment. The guide below will help you understand the Medicare guidelines related to home medical equipment. Most health insurance plans have similar rules to Medicare, but you should know that all private health insurance plans vary and the specific rules of your plan may differ from these Medicare guidelines. We accept most of the major health insurance plans. We would be happy to work with you and your insurance company to help you understand how your plan works as it relates to home medical equipment needed by you or a loved one.
Who qualifies for Medicare benefits?
- Individuals 65 years of age or older
- Under 65 with permanent kidney failure (beginning three months after dialysis begins), or
- Under 65, permanently disabled and entitled to Social Security benefits (beginning 24 months after the start of disability benefits)
The Different Benefits of Traditional Medicare
- Medicare Part A benefits cover hospital stays, home health care and hospice services
- Medicare Part B benefits cover physician visits, laboratory tests, ambulance services and home medical equipment
- While oftentimes you do not have to pay a monthly fee to have Part A benefits, the Part B program requires a monthly premium to stay enrolled. In 2006 that premium is set at $88.50 per month. Typically, this amount will be taken from your Social Security check.
What Can You Expect to Pay?
- Every year, in addition to your monthly premium, you will have to pay the first $124 of covered expenses out of pocket and then 20 percent of all approved charges if the provider agrees to accept Medicare payments.
- Unfortunately, your medical equipment provider cannot automatically waive this 20 percent or your deductible without suffering penalties from Medicare. They must attempt to collect the coinsurance and deductible if they are not covered by another insurance plan; however, certain exceptions can be made if you suffer from qualifying financial hardships.
- If you have some type of supplemental insurance, that plan may pick up this portion of your responsibility after your supplemental plan’s deductible has been satisfied.
- If your medical equipment provider does not accept assignment with Medicare you may be asked to pay the full price up front, but they will file a claim on your behalf to Medicare. In turn, Medicare will process the claim and mail you a check to cover a portion of your expenses if they approve the charges.
Other possible costs:
- Medicare will pay only for items that meet your basic needs as prescribed by a physician. Oftentimes you will find that your provider offers a wide selection of products that vary slightly in appearance or features. You may decide that you prefer the products that offer these additional features. Your provider should give you the option to pay a little extra money to get a product that you really want.
- To take advantage of this opportunity, a new form has been approved by the Centers for Medicare and Medicaid Services (CMS) that allows patients to upgrade to a piece of equipment that they like better than other standard options prescribed by their physician.
- The Advance Beneficiary Notice, or ABN, must detail how the products differ, and requires a signature to indicate that you agree to pay the difference in the retail costs between two similar items. Your provider will typically accept assignment on the standard product and apply that cost toward the purchase of the fancier item, thus requiring less money out of your pocket.
Purpose of ABN
- The Advance Beneficiary Notice also will be used to notify you ahead of time that Medicare will not probably pay for a certain item or service in a specific situation, even if Medicare might pay under different circumstances. The form should not be generic and you should understand why Medicare will not pay for the item you are requesting.
- The purpose of the form is to allow you to make an informed decision about whether or not to receive the item or service knowing that you may have additional out-of-pocket expenses.
Durable Medical Equipment (DME) Defined
- In order for any item to be covered under Medicare, it typically has to meet the test of durability. Medicare will pay for medical equipment when the item:
- Withstands repeated use (excludes many disposable items such as underpads)
- Is used for a medical purpose (meaning there is a condition which the item will improve)
- Is useless in the absence of illness or injury (thus excluding any item preventive in nature such as bathroom safety items used to prevent injuries)
- Used in the home (which excludes all items that are needed only when leaving the confines of the home setting)
Understanding Assignment (a claim-by-claim contract)
- When a provider accepts assignment, it is agreeing to accept Medicare’s approved amount as payment in full.
- You will be responsible for 20 percent of that approved amount. This is called your coinsurance.
- You also will be responsible for the annual deductible, which is $124.00 for 2006.
- If a provider does not accept assignment with Medicare, you will be responsible for paying the full amount upfront. The provider will still file a claim on your behalf and any reimbursement made by Medicare will be paid to you. (Providers must still notify you in advance, using the Advance Beneficiary Notice, if they do not believe Medicare will pay for your claim.)
Mandatory Submission of Claims
- Every provider is required to submit a claim for covered services within one year from the date of service
The role of the physician with respect to home medical equipment:
Every item billed to Medicare requires a physician’s order or a special form called a Certificate of Medical Necessity (CMN), and sometimes additional documentation will be required.
Nurse Practitioners, Physician Assistants, Interns, Residents and Clinical Nurse Specialists also can order medical equipment and sign CMNs when they are treating a patient.
All physicians’ have the right to refuse to complete documentation for equipment they did not order, so make sure you consult with your physician before requesting an item.
Prescriptions Before Delivery:
- For some items, Medicare requires your provider to have completed documentation (which is more than just a call-in order or a prescription from your doctor) before they can deliver these items to you:
- Decubitus care (wheelchair cushions and pressure-relieving surfaces placed on a hospital bed)
- Seat lift mechanisms
- TENS Units (for pain management)
- Electric Wheelchairs
How does Medicare pay for and allow you to use the equipment?
- Typically there are three ways Medicare will pay for a covered item:
- They will purchase it outright, then the equipment belongs to you,
- They will rent it continuously until it is no longer needed, or
- They will consider it a “capped” rental in which Medicare will rent the item for a total of 13 months and consider the item purchased after having made 13 payments.
- Medicare will not allow you to purchase these items outright (even if you think you will need it for a long period of time).
- This is to allow you to spread out your coinsurance instead of paying in one lump sum.
- It also protects the Medicare program from paying too much should your needs change earlier than expected.
BiPaps/Respiratory Assist Devices
- For a respiratory assist device to be covered, the treating physician must fully document in the patient’s medical record symptoms characteristic of sleep-associated hypoventilation, such as daytime hypersomnolence, excessive fatigue, morning headache, cognitive dysfunction, dyspnea, etc.
- A respiratory assist device is covered for those patients with clinical disorder groups characterized as (I) restrictive thoracic disorders (i.e., progressive neuromuscular diseases or severe thoracic cage abnormalities), (II) severe chronic obstructive pulmonary disease (COPD), (III) central sleep apnea (CSA), or (IV) obstructive sleep apnea (OSA).
- Various tests may need to be performed to establish the above diagnosis groups.
- Three months after starting your therapy, both your physician and you will be required to respond to questions in writing regarding your continued use along with how well the machine is treating the condition.
- Breast Prostheses are covered after a radical mastectomy. Medicare will cover:
- One silicone prosthesis every two years or a mastectomy form every six months.
- Mastectomy bras are covered as needed.
- There is no coverage for replacement prostheses due to wear and tear before the listed time frame. However, Medicare will cover replacement of these items due to:
- Irreparable damage, or
- Change in medical condition (e.g. significant weight gain/loss)
- Patients are allowed only one prosthesis per affected side, others will be denied as not medically necessary even if attempting asymmetry (need ABN).
- Mastectomy sleeves are not covered in the home setting because they do not meet Medicare’s definition of a prosthesis; however, it is possible that they may be covered under the hospital per diem if you request one during your hospital stay.
Cervical traction devices are covered only if both of the criteria below are met:
- The patient has a musculoskeletal or neurologic impairment requiring traction equipment.
- The appropriate use of a home cervical traction device has been demonstrated to the patient and the patient tolerated the selected device.
- A commode is only covered when the patient is physically incapable of utilizing regular toilet facilities. For example:
- The patient is confined to a single room, or
- The patient is confined to one level of the home environment and there is no toilet on that level, or
- The patient is confined to the home and there are no toilet facilities in the home.
- Continuous Positive Airway Pressure (CPAP) Devices are covered only for patients with obstructive sleep apnea (OSA).
- You must have an overnight sleep study performed in a sleep laboratory to establish a qualifying diagnosis. Home and mobile sleep labs/studies are not accepted.
- Medicare also will pay for replacement masks, cannulas, tubing and other necessary supplies.
- After three months of use, you will be required to verify if you are benefiting from using the device and how many hours a day you are using the machine.
- For diabetics, Medicare covers the glucose monitor, lancets, spring-powered devices, test strips, control solution and replacement batteries for the meter.
- Medicare does not cover insulin injections or diabetic pills unless covered through a Medicare Part D benefit plan.
- Diabetics can obtain up to a three month supply at a time.
- Medicare will approve up to one test per day for non-insulin dependent diabetics and three tests per day for insulin-dependent diabetics without additional verification.
- Patients who test above these guidelines are required to be seen and evaluated by their physician within six months of ordering these supplies. In addition, patients must provide their provider with evidence of compliant testing every six months to continue getting refills at the higher levels.
- Any time your testing frequency changes, your physician needs to give your provider a new prescription.
- One complete pair after the last cataract surgery:
- two lenses
- tint, anti-reflective coating, UV (only when the doctor specifically orders these services for a medical need)
- A hospital bed is covered if one or more of the following criteria (1-4) are met:
- The patient has a medical condition which requires positioning of the body in ways not feasible with an ordinary bed. Elevation of the head/upper body less than 30 degrees does not usually require the use of a hospital bed, or
- The patient requires positioning of the body in ways not feasible with an ordinary bed in order to alleviate pain, or
- The patient requires the head of the bed to be elevated more than 30 degrees most of the time due to congestive heart failure, chronic pulmonary disease, or problems with aspiration. Pillows or wedges must have been considered and ruled out, or
- The patient requires traction equipment which can only be attached to a hospital bed.
- Lymphedema Pumps are covered for treatment of true lymphedema as a result of a:
- Congenital abnormality of lymphatic drainage such as Milroy’s disease, or
- Malignant tumor affecting lymphatic drainage, or
- Radical cancer surgery or radiation
- Before you can be prescribed a pump, your physician must monitor you during a four-week trial period where other treatment options are tried such as medication, limb elevation and compression garments. If, at the end of the trial, there is little or no improvement, a lymphedema pump can be considered.
- The doctor must then document an initial treatment with a pump and establish that the treatment can be tolerated.
- Lymphedema pumps also are covered for the treatment of chronic venus insufficiency (CVI).
- Before you can be prescribed a pump for this condition, your physician must monitor you during a six month trial period where other treatment options are tried such as medication, limb elevation and compression garments. If at the end of the trial the stasis ulcers are still present, a lymphedema pump can be considered.
- The doctor must then document an initial treatment with a pump and establish that the treatment can be tolerated, that there is a caregiver available to assist with the treatment in the home, and then the doctor must prescribe the pressures, frequency, and duration of prescribed use.
Medicare-covered drugs (other than Medicare Part D coverage)
- As of February 2001, all providers of Medicare-covered drugs are required to accept assignment on these items.
- Traditional Medicare will cover nebulizer drugs, infused drugs, immunosuppressive drugs, oral anti-cancer medications and parenteral nutrition.
Mobility Products: Canes, Walkers, Wheelchairs, and Scooters
- General Coverage Guidelines:
- Essentially the new Mobility Assistive Equipment regulations will ensure that Medicare funds are used to pay for:
- Mobility needs for daily activities within the home
- Least costly alternative/lowest level of equipment to accomplish these tasks.
- Most medically appropriate equipment (to meet the needs, not the wants)
- Medicare requires that your physician and provider evaluate your needs and expected use of the mobility product you will qualify for.
- They must determine which is the least level of equipment needed to help you be mobile within your home to accomplish daily activities by asking the following questions:
- Will a cane or crutches allow you to perform these activities in the home?
- If not, will a walker allow you to accomplish these activities in the home?
- If not, is there any type of manual wheelchair that will allow you to accomplish these activities in the home?
- If not, will a scooter allow you to accomplish these activities in the home?
- If not, will a power chair allow you to accomplish these activities in the home?
- Keep in mind if you have another higher level product in mind that will allow you to do more beyond the confines of the home setting, you can discuss with your provider the option to upgrade to a higher level or more comfortable product by paying an additional out of pocket fee using the Advance Beneficiary Notice select the product you like best.
- A face-to-face examination with your physician is required prior to the initial setup of a power chair or scooter.
- House must accommodate the use of any mobility product.
- Nebulizer machines, medications and related accessories are usually covered for patients with obstructive pulmonary disease, but can also be covered to deliver specific medications to patients with HIV, CF, brochiectasis, pneumocystosis, complications of organ transplants, or for persistent thick or tenacious pulmonary secretions.
Non-covered items (partial listing):
- Adult diapers
- Bathroom safety equipment
- Hearing aides
- Van lifts or ramps
- Exercise equipment
- Humidifiers/Air Purifiers
- Raised toilet seats
- Massage devices
- Stair lifts
- Emergency communicators
- Low Vision Aides
- Grab bars
- Orthopedic shoes are covered when it is necessary to attach the shoe(s) to a leg brace.
- However, Medicare will only pay for the shoe(s) attached to the leg braces.
- Medicare will not pay for matching shoes, or for shoes that are needed for purposes other than for diabetes or leg braces.
- Ostomy supplies are covered for people with a:
- Patients can obtain up to a three month’s supply of wafers, pouches, paste and other necessary items at a time.
- Covered for patients with significant hypoxemia in the chronic stable state when:
- patient has a chronic lung condition or disease or hypoxemia that might be expected to improve with oxygen therapy, and
- patient’s blood gas levels or oxygen saturation levels indicate the need for oxygen therapy, and
- alternative treatments have been tried or deemed clinically ineffective.
- Categories/Groups are based on the test results to measure your oxygen:
- I 55≤ mmHg, or 88%≤ saturation
- For these results you must return to your physician 12 months after the initial visit to continue therapy for lifetime or until the need is expected to end.
- II 56-59 mmHg, or 89% saturation
- For these results, you must be retested within 3 months of the first test to continue therapy for lifetime or until the need is expected to end.
- III ≥60 or ≥90% not medically necessary
Parenteral and enteral therapy
- Parenteral therapy requires all or part of the gastrointestinal tract be missing. Nutritional formulas are delivered through a vein.
- Enteral therapy is covered for patients who cannot swallow or take food orally. Nutrition must be delivered through a tube directly into the gastrointestinal tract.
- Medicare will not pay for nutritional formulas that are taken orally.
- A lift is covered if transfer between bed and a chair, wheelchair, or commode requires the assistance of more than one person and, without the use of a lift, the patient would be bed confined.
- An electric lift mechanism is not covered; because it is considered a convenience feature. If you prefer to have the electric mechanism, your provider can usually apply the cost of the manual lift toward the purchase price of the electric model by using an Advance Beneficiary Notice. You would be responsible to pay the difference in the retail charges between the two items.
Seat Lift Mechanisms
- In order for Medicare to pay for a seat lift mechanism, patients must be suffering from severe arthritis of the hip or knee, or have a severe neuromuscular disease. In addition they must be completely incapable of standing up from any chair, but once standing they can walk either independently or with the aid of a walker or cane. The physician must believe that the mechanism will improve, slow down or stop the deterioration of the patient’s condition.
- Transferring directly into a wheelchair will prevent Medicare from paying for the device.
- Medicare will only pay for the lift mechanism portion. The chair portion of the package is not covered, and the patient will be responsible for the full amount of the chair.
- Group 1 products are designed to be placed on top of a standard hospital or home mattress. They can be utilize gel, foam, water or air, and are covered for patients that are:
- Completely immobile OR
- Have limited mobility with any stage ulcer on the trunk or pelvis (and one of the following):
- impaired nutritional status
- fecal or urinary incontinence
- altered sensory perception
- compromised circulatory status
- Group 2 products take many forms, but are typically powered pressure reducing mattresses or overlays. They are covered for patients with one of three conditions:
- Multiple stage II ulcers on the pelvis or trunk while on a comprehensive treatment program for at least a month using a Group 1 product, and at the close of that month, the ulcers worsened or remained the same. (Monthly follow-up is required by a clinician to ensure that the treatment program is modified and followed. This product is only covered while ulcers are still present.) OR
- Large or multiple Stage III or IV ulcers on the trunk or pelvis (Monthly follow-up is required by a clinician to ensure that the treatment program is modified and followed. This product is only covered while ulcers are still present.) OR
- A recent myocutaneous flap or skin graft for an ulcer on the trunk or pelvis within the last 60 days who were immediately placed on Group 2 or 3 support surface prior to discharge from the hospital and the patient has been discharged within last 30 days.
- TENS units are covered for the treatment of chronic intractable pain that has been present for at least three months or more, and in some cases for acute post-operative pain.
- Not all types of pains can be treated with a TENS unit. TENS units have proven ineffective in treating headaches, visceral abdominal pains, pelvic pains, and TMJ pains, and therefore Medicare will not pay for the device when used to treat these conditions.
- For chronic pain sufferers, Medicare will pay for a one or two month trial rental to determine if this device will alleviate the chronic pain. You must return to your physician exactly 30-60 days after initial evaluation to authorize the purchase of this equipment.
- For acute post-operative pain sufferers, Medicare will consider rental payment for a maximum of 30 days. Any duration longer than that will require individual consideration.
- Special therapeutic shoes, inserts and modifications can be covered for diabetic patients with the following foot conditions:
- previous amputation of a foot or partial foot
- history of foot ulceration
- peripheral neuropathy with callus formation
- foot deformity
- poor circulation in either foot
- Urinary catheters and external urinary collection devices are covered to drain or collect urine for a patient who has permanent urinary incontinence or permanent urinary retention. Permanent urinary retention is defined as retention that is not expected to be medically or surgically corrected in that patient within 3 months.
Below is a summary of the standards Medicare requires of home medical equipment providers. Our company meets or exceeds all of these standards.
- A supplier must be in compliance with all applicable Federal and State licensure and regulatory requirements.
- A supplier must provide complete and accurate information on the DMEPOS supplier application. Any changes to this information must be reported to the National Supplier Clearinghouse within 30 days.
- An authorized individual (one whose signature is binding) must sign the application for billing privileges.
- A supplier must fill orders from its own inventory, or must contract with other companies for the purchase of items necessary to fill the order. A supplier may not contract with any entity that is currently excluded from the Medicare program, any State health care programs, or from any other Federal procurement or non-procurement programs.
- A supplier must advise beneficiaries that they may rent or purchase inexpensive or routinely purchased durable medical equipment, and of the purchase option for capped rental equipment.
- A supplier must notify beneficiaries of warranty coverage and honor all warranties under applicable State law, and repair or replace free of charge Medicare covered items that are under warranty
- A supplier must maintain a physical facility on an appropriate site.
- A supplier must permit CMS (formerly HCFA), or its agents to conduct on-site inspections to ascertain the supplier’s compliance with these standards. The supplier location must be accessible to beneficiaries during reasonable business hours, and must maintain a visible and posted hours of operation.
- A supplier must maintain a primary business telephone listed under the name of the business in a local directory or a toll free number available through directory assistance. The exclusive use of a beeper, answering machine or cell phone is prohibited.
- A supplier must have comprehensive liability insurance in the amount of at least $300,000 that covers both the supplier’s place of business and all customer and employees of the supplier. If the supplier manufactures its own items, this insurance must also cover product liability and completed operations.
- A supplier must agree not to initiate telephone contact with beneficiaries, with a few exceptions allowed. This standard prohibits suppliers from calling beneficiaries in order to solicit new business.
- A supplier is responsible for delivery and must instruct beneficiaries on use of Medicare covered items, and maintain proof of delivery.
- A supplier must answer questions and respond to complaints of beneficiaries, and maintain documentation of such contacts.
- A supplier must maintain and replace at no charge or repair directly, or through a service contract with another company, Medicare-covered items it has rented to beneficiaries.
- A supplier must accept returns of substandard (less that full quality for the particular item) or unsuitable items (inappropriate for the beneficiary at the time it was fitted and rented or sold) from beneficiaries.
- A supplier must disclose these supplier standards to each beneficiary to whom it supplies a Medicare-covered item.
- A supplier must disclose to the government any person having ownership, financial, or control interest in the supplier.
- A supplier must not convey or reassign a supplier number, i.e., the supplier may not sell or allow another entity to use its Medicare billing number
- A supplier must have a complaint resolution protocol established to address beneficiary complaints that relate to these standards. A record of these complaints must be maintained at the physical facility.
- Complaint records must include: the name, address, telephone number, and health insurance claim number of the beneficiary, a summary of the complaint, and any actions taken to resolve it.
- A supplier must agree to furnish CMS (formerly HCFA) any information required by the Medicare statue and implementing regulations.