DME and HME billing services

HME, home medical equipment, is the name suppliers give their business. DME, or DMEPOS, is the name payers give the benefit. A walker, an oxygen concentrator or a hospital bed delivered to a patient's home is billed the same way under either name: a HCPCS Level II code, the modifier for new, rental or used, and the documentation the item's coverage policy asks for. The HME glossary entry sets the two definitions side by side.

What changes from claim to claim is the payer. Medicare.gov says Part B covers medically necessary equipment that a doctor or other provider orders for use in the home, and pays only when the item comes from a supplier enrolled in Medicare; depending on the item, the patient rents it, buys it or gets to choose. Unlike other Medicare claims, the claim is routed by address: CGS's supplier manual sends it to the DME contractor for the state where the beneficiary lives, going by the address on file with Social Security, and the self-service guide the DME contractors publish together names Noridian for jurisdictions A and D and CGS for B and C. The same manual puts the place of service where the patient will mainly use the item. Its list of places that qualify includes the home, assisted living, a group home and a custodial care facility, while coverage in a skilled nursing or nursing facility is limited to certain items.

Medicaid's federal rule reaches past the home. Under the home health benefit, equipment and supplies are covered when they suit any setting where normal life activities take place, and a state may not exclude items outright: it has to give patients a way to ask for items that are not on its approved list. Each state then sets its own codes, prior authorization and fee schedule, and commercial plans set theirs by contract. Your biller keeps those rules per payer, because the same item can meet one payer's criteria and miss another's.¹¹

Pre-billing is four checks, run while the order is still at intake and before anything ships.

Eligibility comes first: active coverage on the delivery date, the plan that actually pays, any secondary, and for Medicare the DME contractor that will receive the claim. It is the same work the eligibility verification service runs for every patient on the schedule.

Same-or-similar comes second. A patient who already has the same or a similar item on file from another supplier is what triggers a same-or-similar denial, so the biller searches the contractor's claim history before delivery. In its same-or-similar resource list, CGS, which runs jurisdictions B and C, points suppliers to its myCGS portal, its phone response system and a lookup tool that lists the HCPCS codes that may count as the same as or similar to the item ordered. Where a match turns up and the patient still wants the item, an advance beneficiary notice is signed before delivery.

Documentation comes third. CMS's order requirements page lists six elements of a standard written order: the beneficiary's name or Medicare number, a description of the item, the quantity where it applies, the treating practitioner's name or NPI, the order date and the practitioner's signature. The complete order has to reach the supplier before the claim is sent. For items on the face-to-face and written-order-prior-to-delivery list, it has to be in hand before delivery, after a face-to-face encounter in the six months before the order. The clinical notes are read against the item's coverage policy at the same time.

Authorization comes fourth. CMS's Required Prior Authorization List covers groups such as power mobility devices, several orthoses, pressure reducing support surfaces, lower limb prosthetics and pneumatic compression devices, and prior authorization is a condition of payment for every item on it. Since January 1, 2025, CMS gives the contractor no more than 7 calendar days to review a standard request. The request goes in with the order and the notes, and the item is delivered once the decision is back.⁶

Supplies sent on a schedule, such as CPAP supplies, diabetic testing supplies and urological or ostomy items, make a new claim with every shipment, and each one has to stand on its own record. Your biller runs the checks on the resupply calendar, patient by patient, before each shipment: coverage still active on the ship date, the quantity inside what the item's policy allows, and the refill confirmation on file and dated inside the window. A patient who changed plans since the last shipment is caught before the box goes out, not on the remittance. Coverage is rechecked the same way eligibility verification works for the rest of the schedule, and a shipment that fails a check is held for intake to fix instead of billed.

The window comes from CMS's refill rule. The patient or their representative confirms the need for the refill within the 30 calendar days before the current supply is expected to run out, and the refill is not delivered sooner than 10 calendar days before the current supply ends. The record for a shipped refill shows the patient's name, the date of contact, the item, the patient's confirmation and why the refill is needed. Patients do not have to count what they have left, and an automated text or email counts when it captures the name, the items, the date and the patient's yes.⁸