Durable Medical Equipment (DME) is any equipment that provides therapeutic benefits to those in need because of certain illnesses and/or medical conditions.
Those providing Durable Medical Equipment or Home Medical Equipment depends on the type of equipment as well as the jurisdiction.
With the term DME covering a wide range of devices, from wheelchairs to clutches to catheters, it may not always be clear to businesses on whether or not they need to be licenses in a participial state in order to provide medical equipment.
Depending on the equipment (e.g., a Pharmacy License), additional permits may be required.
Most Durable Medical Equipment consists of items which:
- Are primarily used to serve a medical purpose
- Are ordered or prescribed by a physician
- Are reusable
- Can be used repeatedly
- Are able to be used inside a home
To help you learn how to become a DME supplier for Medicare, we’ve prepared this step-by-step guide below to help you learn the basics.
How to Become a DME Supplier
Obtain a National Provider Identifier number
To start, obtaining a National Provider Identifier (NPI) number is necessary for meeting the DME license requirements. Existing providers typically have the numbers already, as it is required by the Center for Medicare and Medicaid Services (CMS) and commercial healthcare insurers.
The NPI is a 10-digit number that will be used as your identification in the system for all administrative and billing transactions. In order to register, you’ll need to go through the process with the National Plan and Provider Enumeration Systems (NPPES).
Promise to Meet all DME Standards
In order to become an accredited DME supplier, the CMS requires you to first meet a set 42 Code of Federal Regulations (CFR) of supplier standards. Once you’ve satisfied the set of supplier standards, you can obtain your Medicare billing privileges through the National Supplier Clearinghouse (NSC).
Go Through the DME Accreditation Process With an Approved Accreditation Company
Obtaining an approval during the accreditation process is the key answer to the question on becoming a DME supplier for Medicare.
To be approved, you first have to select from one of the approved accreditation companies and get acquainted with their rules and regulations. Once you fill out an application with the respective company then it will use the Quality Standards in order to assess your approval.
The accreditation process can take up to nine months for approval.
Get your DME Properly Bonded
One of the main costs of acquiring a DME is the security bond.
To meet the bonding requirement set in the enrollment process, you will have to provide a $50,000 bond to the CMS. To get bonded, you have to pay a fraction of the required amount of a bond premium. If your finances are in order, the rates are typically between 1% and 5%.
For example: If you provide a surety bond of $50,000, your cost would range between $500-$2500.
Durable Medical Equipment (DME)
Medicare Part B (Medical Insurance) will cover most of the medically required durable medical equipment (DME)to use in your home if prescribed by your doctor.
Medicare DME coverage includes, but isn't limited to:
- Blood sugar test strips
- Blood sugar monitors
- Infusion pumps & supplies
- Oxygen equipment & accessories
- Patient lifts
- Pressure-reducing beds, mattresses, and mattress overlays
- Wheelchairs & scooters
Medicare will also cover certain prescriptions and supplies that you use with your DME, even if they can only be used once. For example, Medicare covers medications that are used with nebulizers as well as test trips used with diabetes self-testing equipment.
Durable Medical Equipment Costs Without Medicare
Most DME suppliers are governed by stringent federal and state laws, especially those that participate in the Medicare/Medicaid program.
If a supplier is required to obtain a license, a DME company must obtain an “in-state” or a “resident” license which requires an extensive application, proof of insurance, various fees and an inspection. Medicare will cover the cost for different kinds of DME in different ways, depending on the type of equipment.
For example: If your supplier accepts your Medical and you pay 20% of the approved amount, the Part B Deductible will apply towards your durable medical equipment costs.
- You may choose to rent the DME equipment
- You may choose to purchase the DME equipment
- You may be able to choose whether to rent or purchase the DME equipment
If your doctors or suppliers aren’t enrolled in Medicare, they will not provide DME coverage or pay for claims submitted by them, including hospital bed coverage. In order to receive DME coverage by Medicare, your doctor and suppliers must also be enrolled.
Before you inquire about DME, it’s important to ask your suppliers if they’re enrolled in Medicare. If they are, they must accept assignment (i.e. the cost of a hospital bed).
If they’re only “participating” but enrolled in Medicare, they have the option to not accept assignment which means there is no limit on the amount they can charge you for the price of the hospital bed.
Ramifications of Not Having a License
A company providing Durable Medical Equipment without proper DME licenses may be subject to civil and criminal penalties.
If employees will be setting up or installing any of the equipment being provided, it’s imperative that companies ensure their employees are properly license or be faced with heavy fines.
DME providers include home health agencies, DME companies, practitioners, and physicians. Even if you are a licensed home health agency of physicians/practitioner, that does not exclude you from DME licensure.
The State Board of Pharmacy of Department of Health will issue a license.