Guide to Medical Coverage
Understanding Medicare coverage for your home medical equipment and respiratory supplies.
IN THIS GUIDE
Medicare at a Glance
Medicare Part A
Hospital stays, home health care and hospice services.
Medicare Part B
Physician visits, laboratory tests, ambulance services and home medical equipment.
Medicare Part D
Optional program benefits that cover prescription drugs.
For more information about your benefits or making coverage decisions, you can visit the official website for Medicare benefits at www.medicare.gov.
Who Qualifies for Medicare?
Age 65 or Older
Individuals 65 years of age or older.Permanent Kidney Failure
Individuals under 65 with permanent kidney failure requiring dialysis or a kidney transplant.Permanent Disability
Individuals under 65 who are permanently disabled and entitled to Social Security benefits.
What Will Medicare Pay For?
Medicare Part B covers medically necessary home medical equipment when certain Medicare coverage requirements are met.
Oxygen Equipment
Oxygen systems, concentrators and accessories.
Respiratory Devices
CPAP, respiratory assist devices and other devices.
Nebulizer Equipment
Nebulizers and related equipment.
Durable Medical Equipment
Medicare may cover other medically necessary equipment when it meets Medicare's coverage requirements.
What Can You Expect to Pay?
Medicare Part B generally covers 80% of the Medicare-approved amount for covered equipment and services after the annual deductible has been met. You are responsible for the remaining 20%, called coinsurance.
Medicare Part B Premium
You may also be responsible for a monthly Medicare Part B premium.
Annual Deductible
You are responsible for the annual Part B deductible.
Supplemental Insurance
If you have supplemental insurance, it may help pay some or all of the costs that Medicare does not cover.
Other Possible Costs
Upgraded Equipment
Medicare will pay only for items that meet your basic needs. Oftentimes you will find that your supplier 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 supplier should give you the option to allow you to privately pay a little extra money to get the 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 you to upgrade to a piece of equipment that you like better than the other standard option you may otherwise qualify for. This form is known as the Advance Beneficiary Notice or ABN.
Advance Beneficiary Notice (ABN)
The ABN your supplier completes for you 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 supplier 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.
The Advance Beneficiary Notice of Non-Coverage will also be used to notify you ahead of time that Medicare will probably not pay for a certain item or service in a specific situation, even if Medicare might pay under different circumstances. The form should be detailed enough that you understand why Medicare will probably 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.
Understanding Assignment
Assignment is a claim-by-claim contract between Medicare and your supplier.
When a supplier accepts assignment, they are agreeing to accept Medicare’s approved amount as payment in full.
If Your Supplier Accepts Assignment
- You will be responsible for 20 percent of the Medicare-approved amount. This is called your coinsurance.
- You also will be responsible for the annual deductible.
- If you have chosen to receive an upgraded product, you will also be responsible for any additional amounts disclosed on the Advance Beneficiary Notice (ABN) that identifies the additional features and fees you have approved.
If Your Supplier Does Not Accept Assignment
- If a supplier does not accept assignment with Medicare, you will be responsible for paying the full amount upfront. The supplier will still file a claim on your behalf, and any reimbursement made by Medicare will be paid to you directly.
- Important: Suppliers must still notify you in advance, using an Advance Beneficiary Notice (ABN), if they do not believe Medicare will pay for your claim.
Your Physician’s Role
Every item billed to Medicare requires a physician’s order or a special form called a Certificate of Medical Necessity (CMN). Sometimes additional documentation will be required, such as copies of office visit notes from prior visits with your physician or healthcare provider or copies of test results relevant to the prescription of your medical equipment.
Nurse Practitioners, Physician Assistants, Interns, Residents and Clinical Nurse Specialists can also order medical equipment and sign CMNs when they are treating you.
Your Healthcare Provider
All physicians and healthcare providers have the right to refuse to complete documentation for equipment they did not order, so make sure you consult with your physician or healthcare provider about your need for medical equipment or supplies before requesting an item from a supplier.
For every new item prescribed by your physician or healthcare provider, you should have a recent office visit that documents the reasons for ordering the equipment and products. Many items will now require you to have an in-person office visit with your doctor or healthcare provider to discuss the need and justification for the prescription of medical equipment before a supplier can fill those orders.
Prescriptions Before Delivery
For some items, Medicare requires your supplier to have completed documentation — which is more than just a call-in order or a prescription from your doctor or healthcare provider — before they can deliver these items to you:
- Decubitus care (wheelchair cushions, pressure-relieving surfaces placed on a hospital bed and air-fluidized beds)
- Seat lift mechanisms
- TENS Units (for pain management)
- Power Operated Vehicles/Scooters
- Electric or Power Wheelchairs and related options and accessories
- Negative Pressure Wound Therapy (wound vacs)
The list of items that require an office visit and written order before delivery has been expanded due to new provisions of the Affordable Care Act to include all items that cost more than $1,000, and commonly prescribed items such as oxygen, hospital beds, wheelchairs and more. There are over 150 products across multiple product categories that are affected. Your supplier will be able to tell you if the item ordered by your doctor or healthcare provider is subject to these additional requirements.
Important: Your supplier cannot deliver these products to you without a written order from your doctor or healthcare provider, nor can they get the documentation at a later date because if they do, Medicare can never make payment for those products to you or your supplier. So please be patient with your supplier while they collect the required documentation from your physician or healthcare provider.
How Medicare Pays for Your Equipment
How Medicare Pays for Your Equipment:
Purchase
Purchase it outright, then the equipment belongs to you.
Continuous Rental
Rent it continuously until it is no longer needed.
Capped Rental
Medicare will rent the item for a total of 13 months and consider the item purchased after having made 13 payments.
Oxygen Equipment
Medicare will not allow you to purchase these items outright, even if you think you will need them 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.
If you have oxygen therapy, Medicare will make rental payments for a total of 36 months, during which time this fee covers all service and accessories.
Beyond the 36 months, for a period of two additional years, Medicare will limit payments to a small fee for monthly gas or liquid contents, where applicable, and a limited service fee to check the equipment every six months.
Repairs & Service
After an item has been purchased for you, you will be responsible for calling your supplier anytime that item needs to be serviced or repaired.
When necessary, Medicare will pay for a portion of repairs, labor, replacement parts, and for temporary loaner equipment to use during the time your product is in for servicing.
All of this is contingent on the fact that you still need the item at the time of repair and continue to meet Medicare’s coverage criteria for the item being repaired.
What Is Competitive Bidding?
In many parts of the country, a program called Competitive Bidding requires you to obtain certain medical equipment from specific, Medicare-contracted suppliers in order for Medicare to pay.
Not all products are subject to competitive bidding in the same area. If you are located in a city where the program is in effect, you will need to obtain some or all of the following items from a contracted supplier:
- Oxygen, oxygen equipment, and supplies
- Standard power wheelchairs, scooters, and related accessories
- Enteral nutrition, equipment, and supplies
- Continuous Positive Airway Pressure (CPAP) devices and Respiratory Assist Devices (RADs), and related supplies and accessories
- Hospital beds and related accessories
- Walkers and related accessories
- Support surfaces (Group 1 and Group 2 mattresses and overlays)
- Manual Wheelchairs and accessories
- Mail-order and direct delivery of diabetic supplies
- Nebulizers
- Home infusion therapy including insulin pumps and supplies
- TENS Units and supplies
- Patient Lifts
- Commodes
- Seat Lifts
- Negative Pressure Wound Therapy Devices and related supplies and accessories
How Do I Know If Competitive Bidding Applies to Me?
Competitive Bidding areas are designated based on the ZIP code of your permanent residence on file with Social Security.
To find out if your ZIP code is affected by Competitive Bidding, call 1-800-MEDICARE (1-800-4227).
You may also visit Medicare.gov and look up suppliers in your area by ZIP code. A notice will appear if your area is subject to Competitive Bidding.
If medical equipment is marked with an orange star, it will need to be provided by a contracted supplier, also marked with an orange star.
Throughout this guide, products that are potentially impacted by the competitive bidding program will be designated with a double asterisk (**).
Your provider can assist you with answering your questions about competitive bidding and can address whether or not they have been contracted to provide the services you need if subject to competitive bidding.