DME Billing Services
A DME supplier's worst losses are silent. A capped-rental month that nobody billed produces no denial, no rejection and no line on a report — once timely filing closes, the money is gone. An item delivered before the paperwork that makes it payable existed is the same kind of loss: nothing looks wrong until the claim is reviewed. Neither is a coding problem, and neither gets fixed by working the denial queue harder. We bill the item rather than the claim. Every rental is tracked per patient per item across the full 13-month capped-rental cycle, with the modifier sequence applied in order and title transfer flagged before it falls due, and a monthly exception report lists every active rental whose expected billing date has passed without a claim — so the failure that never produces a denial produces a line on a report instead. The documentation is checked before delivery, not after. That means the written order carrying all six required elements, the face-to-face encounter inside the six-month window that replaced the old 45-day power mobility rule, prior authorization confirmed against the list that is a condition of payment rather than the broader Master List, and refill contact and date-of-service timing checked against the refill rules. Certificates of Medical Necessity are no longer part of any of it — CMS retired the form, and a claim that still carries one comes back returned. We work the rules as they read now, which matters in a category where much of what is still published describes the superseded version. Built for suppliers whose workflow is still shaped around the retired CMN, for companies missing monthly rental cycles, and for lines expanding into oxygen and positive airway pressure.
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What do DME billing services handle?
We bill DME suppliers across the item lifecycle — intake documentation, HCPCS Level II coding, monthly rental cycles, prior authorization and A/R follow-up — for equipment, wheelchairs, orthotics and prosthetics, supplies and the drugs dispensed with them. The largest DME losses never appear as denials: a capped-rental month nobody billed is gone once timely filing closes, so we run the rental calendar as a monthly exception report rather than a reminder. The second condition is sequence. A written order or prescription with six elements, and for items on the Required Face-to-Face Encounter and Written Order Prior to Delivery List a face-to-face encounter within the preceding six months, both have to exist before the equipment leaves the warehouse — so we check the dates before delivery and hold the item when they do not line up. Certificates of Medical Necessity are not part of this any more: CMS retired the CMN and the DIF for dates of service on or after 1 January 2023.
- Capped-rental tracking per patient per item across 13 months, with KH on the initial claim, KI on months two and three, KJ thereafter, and RR on every rental claim
- Face-to-face dates checked against the 6-month window before the written order for items on the Required Face-to-Face Encounter and Written Order Prior to Delivery List
- Standard written order elements verified before delivery — not a Certificate of Medical Necessity, which CMS retired for dates of service on or after 1 January 2023
- Prior authorization confirmed against the Required Prior Authorization List, which is the subset of the Master List that is a condition of payment — not the Master List itself
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Who This Page Is For
Common Billing Friction in DME
Capped-rental month tracking and the KH/KI/KJ sequence
For capped rental items furnished on or after 1 January 2006, Medicare pays a monthly rental amount during the period of medical need for no longer than 13 months of continuous use, and on the first day after the 13th continuous month in which payment is made the supplier must transfer title to the beneficiary (42 CFR 414.229(f), read 17 September 2026). The modifier sequence is fixed: KH is the DMEPOS item initial claim, purchase or first month rental; KI is the second or third month rental; KJ is the parenteral or enteral nutrition pump or capped rental months four to fifteen, which for a 13-month capped rental means every remaining month. RR marks the claim as a rental. Miss a cycle and the month is unrecoverable once timely filing closes — Medicare does not reopen it, and nothing appears on a denial report, because no claim was ever submitted. This is why the control has to be an exception report that lists every active rental whose expected billing date has passed without a claim, produced monthly, per patient, per item.
Standard written orders and face-to-face timing after the 2020 rule
Two rules here are commonly published in their superseded form. First, every DMEPOS item requires a written order or prescription for Medicare payment, and it must carry six elements: beneficiary name or Medicare Beneficiary Identifier, a general description of the item, quantity to be dispensed where applicable, order date, treating practitioner name or NPI, and the treating practitioner's signature. Second, the face-to-face window is 6 months, not 45 days: for power mobility devices and other items on the Required Face-to-Face Encounter and Written Order Prior to Delivery List, the treating practitioner must document and communicate that a face-to-face encounter occurred within the 6 months preceding the date of the written order (42 CFR 410.38(d), read 17 September 2026). Only for items on that list must the order reach the supplier before delivery; for everything else it must reach the supplier before the claim is submitted. Refills have their own timing: contact confirming the refill is needed must fall within 30 calendar days of the expected end of the current supply, and the date of service can be no earlier than 10 calendar days before that expected end. Certificates of Medical Necessity and DME Information Forms play no part — CMS retired them, and for dates of service on or after 1 January 2023 a claim received with one attached is rejected and returned to the supplier.
LCD coverage criteria and what the KX modifier attests
The DME MACs publish Local Coverage Determinations that define which clinical criteria support medical necessity for each item, and one point is worth correcting because suppliers plan around it wrongly: these LCDs are joint. A single policy carries all four jurisdictions — the positive airway pressure LCD, L33718, lists CGS Administrators for J-B and J-C and Noridian for J-A and J-D on the same document — so a supplier delivering in Texas (Jurisdiction C, CGS) and Pennsylvania (Jurisdiction A, Noridian) is working to the same coverage policy, not two. What differs between jurisdictions is the contractor you deal with, not the criteria. Positive airway pressure is the clearest worked example: continued coverage beyond the first three months requires the treating practitioner to conduct an in-person clinical re-evaluation no sooner than the 31st day and no later than the 91st day after therapy starts, documenting improved symptoms, plus objective evidence of adherence — defined in the LCD as use of at least 4 hours per night on 70 percent of nights during a consecutive 30-day period at any point in the first three months (L33718, read 17 September 2026). The KX modifier is the supplier's attestation that the coverage criteria in the applicable policy are met. Omitting it where it is required produces an immediate denial; applying it where the record does not support it is a False Claims Act exposure, which is why we attest from the chart rather than from the order. Bi-level devices without a backup rate (E0470) are not covered by that policy at all — they sit under the separate respiratory assist device LCD, with its own qualifying testing and criteria, which is why the KX attestation has to be made against the policy that actually applies to the item.
The Master List is not the prior authorization list
These are two different lists and treating them as one produces both unnecessary work and unbillable deliveries. The Master List of DMEPOS Items Potentially Subject to Face-To-Face Encounter and Written Orders Prior to Delivery and/or Prior Authorization Requirements is, in CMS's own words, a library from which items may be selected — it is not itself a requirement. The Required Prior Authorization List is the subset selected from it that requires prior authorization as a condition of payment, published in the Federal Register and posted on the CMS prior authorization website, effective no less than 60 days after publication (42 CFR 414.234, read 17 September 2026). A claim for an item on that list without a provisional affirmation is denied; a non-affirmed request can be resubmitted, but only before the item is furnished and before the claim goes in. Three of the codes on this page sit on that list today: the group 2 standard power wheelchair K0823 has required prior authorization nationwide since 1 September 2018, the group 3 standard single-power-option chair K0856 since 17 July 2017, and the knee orthosis L1843 since 12 August 2024 (CMS Required Prior Authorization List, read 17 September 2026). Two provisions in the same section are worth knowing because they change the workload: CMS may exempt a supplier that achieves a payable-claim rate of at least 90 percent on review, withdrawing the exemption if the non-payable rate later exceeds 10 percent; and an expedited review is available where the standard timeline could seriously jeopardize the beneficiary's life, health or ability to regain maximum function — expedited means faster than standard, not a longer window.
Competitive bidding is in a gap period, and rates changed accordingly
The DMEPOS Competitive Bidding Program is not currently running, and content that still describes contract-supplier status as a live gate for CPAP, oxygen, hospital beds or wheelchairs is describing a program that ended. Round 2021 awarded contracts for two product categories only — off-the-shelf back braces and off-the-shelf knee braces — and all of those contracts expired on 31 December 2023. Since 1 January 2024 CMS has been in a temporary gap period, and has said bidding for the next round will start after it completes notice-and-comment rulemaking; a Round 2028 FAQ has been published. During the gap, fees in former competitive bidding areas are adjusted based on 100 percent of the area's single payment amount increased by the projected change in the Consumer Price Index for All Urban Consumers from January 2023 to January 2024, and fees in non-bidding areas are set under the adjusted methodology at 42 CFR 414.210(g) (CMS DMEPOS Competitive Bidding page, read 17 September 2026). The practical consequence is that the rate a supplier should expect now depends on whether the delivery address sits in a former bidding area, and pricing built on Round 2021 assumptions is wrong in both directions.
DME-Specific Payer Issues We Watch For
Medicare
Issue: For items on the Required Face-to-Face Encounter and Written Order Prior to Delivery List, the face-to-face encounter must fall within the 6 months preceding the date of the written order, and both the order and the encounter documentation must reach the supplier before delivery. The 45-day power mobility window that is still widely published was superseded
Our approach: We check every face-to-face date against the order date and hold delivery where the encounter falls outside the 6-month window, rather than delivering and discovering the claim is unbillable
Positive airway pressure
Issue: Continued coverage beyond the first three months requires an in-person clinical re-evaluation between the 31st and 91st day after therapy starts and objective adherence data — at least 4 hours per night on 70 percent of nights over a consecutive 30-day period within the first three months. Suppliers that collect the download but miss the re-evaluation window lose the rental from month four
Our approach: We build the PAP file around those two dates: the qualifying sleep test and order at the front, the re-evaluation scheduled inside the 31-to-91-day window, and the compliance download attached before the month-four claim goes out
Commercial and Medicare Advantage
Issue: Commercial and Medicare Advantage plans set their own DMEPOS documentation, authorization and submission requirements by product and effective date, and they do not necessarily follow the Medicare rules — including where Medicare has retired a form or changed a window
Our approach: We hold a per-plan requirement matrix, date-stamped at the point we read it, and re-check it at each product year rather than assuming a plan moved when Medicare did
Medicaid
Issue: State Medicaid programs run their own prior authorization forms and coverage criteria for DMEPOS, which do not line up with the Medicare documentation set and create a parallel packet for every dual-eligible patient
Our approach: We maintain state-specific Medicaid PA form libraries and populate them from the clinical documentation already collected for the Medicare written order and face-to-face record, so the same evidence is captured once
What We Handle
Standard written order and face-to-face documentation verification
Written orders checked for all six required elements before delivery, and face-to-face encounter dates checked against the 6-month window preceding the order date for items on the Required Face-to-Face Encounter and Written Order Prior to Delivery List. Refill contact and date-of-service timing checked against the 30-day and 10-day rules. No Certificate of Medical Necessity workflow, because CMS retired the form for dates of service on or after 1 January 2023.
Capped-rental cycle tracking with KH/KI/KJ/RR sequencing
Per-patient, per-item tracking across the 13-month capped-rental schedule, with the modifier sequence applied automatically — KH on the initial claim, KI on months two and three, KJ thereafter, RR on every rental claim. A monthly rental exception report lists every active item whose expected billing date has passed without a claim, every item approaching month 13, and every title transfer due, so the failure that never produces a denial produces a line on a report instead. Title transfers to the beneficiary on the first day after the 13th paid month.
HCPCS Level II coding for E-, K-, L-, A-, and J-code series
Equipment (E codes), wheelchairs (K codes), orthotics and prosthetics (L codes), supplies (A codes) and drugs and biologicals (J codes) coded from the current quarterly HCPCS release rather than from a stored code list, so retired and revised descriptors are caught at the quarter rather than at audit. NU, UE, RR and KX discipline applied per claim.
Required Prior Authorization List processing
Prior authorization submitted for power wheelchairs and other items that appear on the Required Prior Authorization List — the condition-of-payment subset, checked against the current published list rather than against the broader Master List. Clinical documentation packaged to the coverage criteria, provisional affirmation tracked, and delivery held until it arrives, with expedited review requested where the standard timeline would jeopardize the beneficiary.
Respiratory equipment compliance and oxygen billing
Positive airway pressure documentation worked to the LCD: the in-person clinical re-evaluation between the 31st and 91st day after therapy starts, and objective adherence of at least 4 hours per night on 70 percent of nights over a consecutive 30-day period in the first three months. Oxygen billed on its own rental rules with E1390 stationary concentrator and E0431 portable gaseous system, against the qualifying test documentation the policy requires.
Mobility, diabetic, and orthotic line management
Walkers (E0143), standard and power wheelchairs (K0001, K0823 group 2 standard captain's chair, K0856 group 3 standard single power option), diabetic supplies (A4253 test strips per 50, E0607 home blood glucose monitor) and L-code orthotics, each checked against the coverage policy, the prior authorization list and the delivery address's pricing area.
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Key DME CPT Codes
| CPT Code | Description | Medicare Amount CY2026 national, non-facility |
|---|---|---|
| E1390 | Oxygen concentrator, single delivery port, 85 percent or greater concentration at the prescribed flow rate | Monthly rental, DMEPOS fee schedule |
| K0823 | Power wheelchair, group 2 standard, captain's chair, weight capacity up to 300 pounds | Capped rental or purchase, DMEPOS fee schedule |
| E0601 | Continuous positive airway pressure (CPAP) device — humidifier is separate (E0561 non-heated, E0562 heated) | Capped rental, DMEPOS fee schedule |
| L1843 | Knee orthosis, single upright, thigh and calf, adjustable flexion/extension joint, prefabricated and customized to the patient | DMEPOS fee schedule |
| E0260 | Hospital bed, semi-electric (head and foot adjustment), any type side rails, with mattress | Capped rental, DMEPOS fee schedule |
| A4253 | Blood glucose test or reagent strips for home monitor, per 50 strips | DMEPOS fee schedule, quantity limited |
| E0431 | Portable gaseous oxygen system, rental — includes container, regulator, flowmeter, humidifier, cannula or mask and tubing | Monthly rental, DMEPOS fee schedule |
| K0856 | Power wheelchair, group 3 standard, single power option, sling/solid seat and back, weight capacity up to 300 pounds | Capped rental or purchase, DMEPOS fee schedule |
Amounts are the Medicare national unadjusted non-facility amounts for CY2026, computed from the published CMS relative value file. They are not what a commercial payer pays, and your locality adjustment moves them. A dash means Medicare publishes no amount for that code — because it is non-covered, bundled, or priced outside the fee schedule.
Why General Billing Teams Miss DME Issues
General billing staff handle dozens of specialties and rarely develop the depth needed for dme coding nuances. Here is what gets missed.
Modifier and bundling errors
Specialty-specific modifier rules and CCI edits are frequently overlooked by teams that do not work exclusively in dme.
Under-coding high-complexity visits
DME encounters often qualify for higher-level E/M codes, but generalist billers default to mid-level codes to avoid audit risk.
Missed payer-specific rules
Each payer has unique coverage and documentation requirements for dme procedures that general teams rarely memorize.
Slow denial turnaround
Without specialty knowledge, appeal letters lack the clinical specificity needed to overturn dme denials quickly.
“The most expensive mistake in DME billing is not a denied claim — it is the rental cycle nobody billed, because nothing was denied and nothing appears on a report. The fix is not a reminder, it is an exception report that lists every active rental whose billing date has passed without a claim.”
MedPrecision Billing Team
DME Billing Compliance Manager
Transition Plan
Switching billing partners should not disrupt patient care or cash flow. Our transition plan is designed for zero downtime.
Discovery and Specialty Audit
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System Integration
We connect to your EHR and practice management system, configure specialty-specific code sets, and validate charge capture workflows.
Parallel Billing Period
We run billing in parallel with your current process for 2-4 weeks to verify accuracy before taking over completely.
Full Transition and Reporting
Once validated, we assume full billing responsibility with monthly reporting dashboards and a dedicated account manager.
DME Billing Terms
- Written Order/Prescription (Standard Written Order)
- The written communication from a treating practitioner that documents the need for a DMEPOS item. Every DMEPOS item requires one for Medicare payment, and it must carry six elements: beneficiary name or Medicare Beneficiary Identifier, general description of the item, quantity to be dispensed where applicable, order date, treating practitioner name or NPI, and the practitioner's signature. It replaced the Certificate of Medical Necessity, which CMS retired for dates of service on or after 1 January 2023.
- Capped Rental
- A Medicare DMEPOS payment category in which an item furnished on or after 1 January 2006 is rented for no longer than 13 months of continuous use, after which the supplier must transfer title to the beneficiary. Monthly claims must be submitted in each billing period; a month missed past timely filing is not recoverable and never appears as a denial.
- Certificate of Medical Necessity (retired)
- The form that once documented medical justification for selected DMEPOS categories, alongside the DME Information Form. CMS retired both: for dates of service on or after 1 January 2023 suppliers no longer submit them, and a claim received with one attached is rejected and returned. The requirement it stood in for is now the written order or prescription and the supporting medical record.
- Competitive Bidding Area (CBA)
- Geographic areas in which the Medicare DMEPOS Competitive Bidding Program set payment through a bidding process. The program is in a temporary gap period: the Round 2021 contracts, which covered off-the-shelf back braces and off-the-shelf knee braces only, expired on 31 December 2023, and no contracts have been in effect since 1 January 2024. Fees in former bidding areas are now adjusted from the area's single payment amount.
- HCPCS Level II Codes
- The Healthcare Common Procedure Coding System Level II codes used for DMEPOS items, supplies and accessories — E codes for equipment, K codes for wheelchairs and temporary assignments, L codes for orthotics and prosthetics, A codes for supplies and J codes for drugs and biologicals. CMS republishes the file quarterly, so descriptors and code status should be read from the current release rather than from a stored list.
- Title Transfer at Month 13
- The point at which a capped rental item becomes the beneficiary's property: the first day after the 13th continuous month in which Medicare payment was made. No later than two months beforehand, the supplier must tell the beneficiary whether it can maintain and service the item once they own it — a disclosure requirement, not a standing obligation to service it.
Last updated: 2026-09-17
Common Questions
Common questions about dme billing services.
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Request ReviewWhat is the capped rental program and how does billing work?
For capped rental items furnished on or after 1 January 2006, Medicare pays a monthly rental amount during the period of medical need for no longer than 13 months of continuous use, and the supplier must transfer title to the beneficiary on the first day after the 13th continuous month in which payment is made (42 CFR 414.229(f), read 17 September 2026). There is no purchase-option step in that path — the 10th-month purchase offer and the 15-month rental cap belong to the pre-2006 rules, and the surviving purchase offer at initial delivery applies to complex rehabilitative power wheelchairs. The same section requires the supplier to tell the beneficiary, no later than two months before title transfers, whether it can maintain and service the item once the beneficiary owns it. We track the cycle per patient per item, submit each monthly claim with the right modifier, and flag the title transfer before it falls due.
What documentation is needed for a power wheelchair claim?
A written order or prescription carrying six elements — beneficiary name or Medicare Beneficiary Identifier, general description of the item, quantity where applicable, order date, treating practitioner name or NPI, and signature — plus a face-to-face encounter with the treating practitioner within the 6 months preceding the date of that order, documented in the medical record with the subjective and objective findings used to manage the condition, and prior authorization where the device appears on the Required Prior Authorization List — which covers 46 power mobility device codes, including K0823 and K0856 (42 CFR 410.38, read 17 September 2026). The order and the encounter documentation must reach the supplier before delivery, not before billing. The 45-day window often quoted for power mobility was replaced by the 6-month rule; we compile the package to the current standard and hold delivery until it is complete.
How do you handle billing for DME supplies and accessories?
We bill supplies and accessories on the HCPCS code and at the intervals each payer's coverage policy allows, and we work the refill rules rather than the shipping calendar. For Medicare, contact with the beneficiary confirming the refill is needed must fall within 30 calendar days of the expected end of the current supply, and the date of service can be no earlier than 10 calendar days before that expected end — for shipped items the date of service is the shipping date (42 CFR 410.38(d)(4), read 17 September 2026). We track refill dates and quantity limits against those rules so shipments and claims stay in step.
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