Medicare's Durable Medical Equipment (DME) Benefits

Page Reviewed / Updated - Feb. 2014

Medicare does pay for durable medical equipment, but the devil is in the details.

Do Medicare's Benefits Include Home / Durable Medical Equipment?

Medicare is a federal health insurance program for the aging, elderly or disabled and the short answer is Yes! Medicare does pay for durable medical equipment (DME).  Prior to a more thorough discussion, it is important to distinguish between the different types of Medicare coverage because the benefits change depending on the type of coverage. Medicare Part A is hospital insurance, Part B is for outpatient services and Part C also called Medicare Advantage, is a combination of Part A and Part B sold by private companies instead of provided by the government.

Part A has strict requirements. Individuals must be Homebound, meaning they cannot leave their home without assistance and they must require skilled nursing care. If the equipment is medically necessary and purchased from an approved supplier, Part A will pay for 80% of the allowable amount for any specific item. The individual is responsible for the remaining 20% and any amount over the allowable limit.

Part B pays for home medical equipment for most Medicare recipients even if they are not Homebound. The equipment must be for use in the home or personal care residence such as assisted living but not in a nursing home. Home medical equipment must be medically necessary and purchased from a Medicare-approved supplier. Medicare Part B pays for 80% of the allowable purchase price and the individual is responsible for the remaining 20% and any amount over the allowable limit.

Part C, also known as Medicare Advantage Plans, is required by law to provide at least the same coverage as Part A and Part B. Therefore, if one has Medicare Part C, their plan will pay at least 80% of the allowable limit.

 

Types of DME Covered by Medicare

It is best to think of Medicare’s durable medical equipment coverage as having 2 levels: DME that is covered when determined to be medically necessary and DME that is never covered despite the need. For example, grab bar rails may be completely necessary for an individual however Medicare does not consider them to be medical equipment and therefore does not cover the cost.

DME vs. Home Care Supplies
It is common for persons not to make this distinction and it is one worth making as Medicare has a completely different policy for home and/or disposable medical supplies.  Read more

The table below list the most commonly requested durable medical equipment, whether it is covered and if not, Medicare’s reason for denying coverage. This list is by no means exhaustive, rather it is meant to provide the reader with a sense of Medicare’s logic so they may apply that to their own situation.

 

Medicare's 2014 Durable Medical Equipment Coverage

Item Type

Medicare Coverage Policy / Denial Reason

Air Cleaners / Conditioners

Environmental control equipment; not primarily medical in nature

Air Fluidized Beds

Covered

Bathtubs (Walk In)

Not covered; not primarily medical in nature. Find other assistance.

Beds (Oscillating)

Institutional equipment; inappropriate for home use

Blood Glucose Analyzers

Unsuitable for home use

Blood Sugar Monitors

Covered

Catheters

Nonreusable disposable supply

Commode Chairs

Covered

Crutches

Covered

Dehumidifiers and humidifiers

Environmental control equipment; not primarily medical in nature

Diabetic Test Strips

Covered

Diathermy Machines

Inappropriate for home use

Disposable Sheets

Nonreusable disposable supplies

Electrical Stimulation for Wounds

Inappropriate for home use

Elevators

Convenience item; not primarily medical in nature

Esophageal Dilators

Physician instrument; inappropriate for patient use

Exercise Equipment

Not primarily medical in nature

Fabric Supports

Nonreusable supplies; not rental-type items

Grab Bars

Self-help device; not primarily medical in nature

Heat and Massage Foam Pads

Not primarily medical in nature; personal comfort item

Home Oxygen Equipment

Covered

Hospital Beds

Covered

Incontinent Pads

Nonreusable supply; hygienic item

Infusion Pumps

Covered

Injectors (hypodermic jet)

Not covered self-administered drug supply; pressure powered devices

Irrigating Kits

Nonreusable supply; hygienic equipment

Massage Devices

Personal comfort items; not primarily medical in nature

Nebulizers

Covered

Overbed Tables

Convenience item; not primarily medical in nature

Powered / Electric Wheelchairs

Covered

Patient lifts

Covered

Preset Portable Oxygen Units

Emergency, first-aid, or precautionary equipment; not therapeutic

Raised Toilet Seats

Convenience item; hygienic equipment; not primarily medical in nature

Spare Tanks of Oxygen

Convenience or precautionary supply

Speech Teaching Machines

Education equipment; not primarily medical in nature

Stair Lifts

Not covered; not medical in nature.  Find other assistance.

Suction Pumps

Covered

Telephone Alert Systems

Emergency communications systems and not diagnostic or therapeutic

Toilet Seats

Not medical equipment

Traction Equipment

Covered

Treadmill Exercisers

Exercise equipment; not primarily medical in nature

Walkers

Covered

Walk In Bathtubs

Not covered; not primarily medical in nature. Find other assistance.

Wheelchairs

Covered

 

What are Medicare Suppliers vs. Medicare Participating Suppliers?

 To ensure that Medicare beneficiaries pay the least amount possible out of pocket for durable medical equipment, it is important to distinguish between Medicare Suppliers and Medicare Participating Suppliers.

Medicare Participating Suppliers are suppliers that have agreed to accept “assignment” or the Medicare approved price for a particular of item of DME. Purchasing from a Medicare Participating Supplier ensures the individual will not pay more than the 20% co-pay of the Medicare approved price for an item. This is usually the least expensive route for Medicare beneficiaries.

Medicare Suppliers are enrolled in Medicare’s program, meaning they will accept Medicare as a form of payment, but they have the flexibility to set their own prices. By using a Medicare Supplier, the individual may or may not spend the least amount out-of-pocket.

There are also DME suppliers that are not approved by Medicare. If one purchases from these suppliers, Medicare will not pay.

 

 

Finding Medicare Approved Suppliers

Medicare provides a searchable database of all approved suppliers. One can search by item type and by zip code. Results can be sorted to show Participating Suppliers first. Search for Medicare Approved Suppliers.

 

 

Renting vs. Buying Medical Equipment with Medicare

Typically the decision to rent vs. buy is not made by the individual Medicare recipient instead it is made by Medicare on an item by item basis. In many cases this works to the individual’s benefit as they do not have to spend additional money should an item break or require repairs. The Medicare-approved supplier will inform the individual if the item they require is available for rent or purchase.

 

 

What are Medicare’s Allowable Limits for Home Medical Equipment?

Medicare has determined the maximum dollar amount their Participating Suppliers are allowed to charge for any particular item of home medical equipment. This is referred to as the “allowable limit”. Medicare updates this regularly and communicates this information to all their suppliers.

Making sure suppliers only charge the allowable limit is a self-regulating process in that Medicare will only reimburse suppliers the allowed amount. If suppliers attempt to bill for more than the allowable limit, they run the risk of not being reimbursed at all.

 

 

What is Upgraded Equipment and How Does One Purchase it with Medicare?

Sometimes suppliers will reduce the cost of the upgraded equipment in order to make a sale.

Typically when Medicare approves an item of durable medical equipment, they will approve only the most basic item available. For example, Medicare may approve the purchase of a walker, but not one with wheels and a hand brake; this would be considered “upgraded equipment”.

It is possible that an upgrade is medically necessary and if so, Medicare will pay for its portion of the upgrade cost. One’s prescription must state specifically the medical reason for why an upgrade is necessary. For example, the individual does not have the physical strength or balance required to lift a standard walker and therefore one with wheels is required.

Upgrades are also possible simply because the individual prefers a different model. However in this situation, Medicare will not pay the additional cost instead the individual or the supplier is responsible for making up the difference. Medicare has developed a specific process for this situation to help avoid fraud and abuse. When an upgrade occurs, the suppliers provide the individual with a document called an Advance Beneficiary Notice (ABN) which requires their signature. The ABN states the nature of the upgrade and that the individual is responsible for the additional cost. It is worth noting that sometimes suppliers will reduce the cost of the upgraded equipment in order to make a sale. The ABN is then provided to Medicare by the supplier when requesting reimbursement.