Helping Clients Navigate Medicare’s Durable Medical Equipment Coverage

Your client needs a walker and asks you whether Medicare will cover the cost. What do you tell them?

Hopefully, you say something like, “It depends.” If you’re really thinking, “I don’t know,” or you’re not sure of the specifics, don’t worry; we’re here to help.

A walker is an example of durable medical equipment (DME), and the answer to whether Medicare covers the cost is a little more complicated than a simple “yes” or “no.”

Explore the basics of DME and Medicare and our tips for helping your clients navigate DME coverage.

What Is Durable Medicare Equipment?

Not everything your client uses for medical reasons will count as DME. To qualify as DME, the equipment must be deemed medically necessary by a provider and:

It must be…

• Durable (can withstand repeated use)
• Used for a medical reason
• Typically only useful to someone who is sick or injured
• Used in your home
• Expected to last at least three years

Examples of eligible DME include, but are not limited to:

• Blood sugar meters and test strips
• Commode chairs
• Continuous Positive Airway Pressure (CPAP) machines
• Mobility devices such as canes, crutches, patient lifts, walkers, wheelchairs, and scooters
• Nebulizers
• Oxygen equipment

Explore Medicare.gov for a fuller list. When in doubt, call 1-800-MEDICARE to verify eligibility.

Are Hearing Aids Considered Medical Equipment?

Surprisingly, you won’t see hearing aids on the list of DME. Although worn all day and lasting longer than three years, Medicare doesn’t categorize hearing aids as DME, instead classifying them as elective or Class I medical devices.

Since they are not medically necessary, prescribed by a doctor, or regulated by the FDA, Original Medicare will not cover hearing aids or fitting exams. Your best bet for finding a plan with any sort of hearing aid coverage is a Medicare Advantage (MA) plan offering this as a perk or combined dental, vision, and hearing insurance that can supplement another plan.

Since they are not medically necessary, prescribed by a doctor, or regulated by the FDA, Original Medicare does not define hearing aids as DME and will not cover them.

What Else Does Medicare Exclude as DME?

Although Original Medicare covers a wide range of DME, it won’t cover certain kinds of supplies, including:

• Equipment mainly used outside the home (e.g., motorized scooter when client is still mobile around the house)
• Items intended to increase convenience or comfort (e.g., stairway elevator, air conditioners)
• Single-use items or supplies that are not used with equipment (e.g., incontinence pads, compression leggings, surgical face masks)
• Home modifications (e.g., ramps)
• Equipment not suited for home use (e.g., paraffin bath units, oscillating beds)

When your client asks about coverage of DME, use this information to gauge whether Medicare may cover it or not. If not, communicate openly with your client and brainstorm options to alleviate the financial burden or find alternatives or coverage elsewhere.

How Medicare Works to Cover DME

Which part of Original Medicare covers DME and how it works can easily trip up even the most discerning agents, especially when MA plans and Medicare Supplements (Med Supps) enter the arena. Fortunately, we can spell it out for you!

What Part of Original Medicare Covers DME?

Medicare Part B, the doctor and medical services side, covers eligible DME. Once your client meets the Part B deductible, Medicare pays 80 percent of the Medicare-approved amount, and your client pays the remaining 20 percent. Medicare will only cover DME obtained from a supplier enrolled in Medicare and only cover 80 percent of the Medicare-approved amount.

Additionally, suppliers who are enrolled in Medicare could be either participating (accepting assignment) or non-participating (not accepting assignment). Here’s how the different configurations work.

If your client purchases DME through a supplier…

• Not enrolled in Medicare: There is no limit to what the supplier can charge, and Medicare won’t cover the costs.
• Enrolled in Medicare but not participating: There is no limit to what the supplier can charge, but Medicare will only cover 80% of the Medicare-approved part.
• Enrolled in Medicare and participating: The supplier can only charge the Medicare-accepted amount, and Medicare will cover 80%.

Medicare will only cover DME obtained from a supplier enrolled in Medicare and only cover 80 percent of the Medicare-approved amount.

Medicare Advantage Plans

At minimum, MA plans must cover what Original Medicare does, meaning your clients with MA plans will be able to utilize the same 80/20 coverage for DME. Some MA plans may offer additional coverage (up to 100 percent) for certain commonly prescribed DME, like blood sugar testing supplies; however, to know for sure, you must review the outline of coverage or consult the MA provider.

Medicare Supplement Plans

We receive a lot of questions about how Med Supps work with DME. Med Supps supplement coverage under Original Medicare. As such, here’s what different Med Supp plans will cover when it comes to eligible DME (which is covered under Part B):

• Plans A, B, C, D, F, G, M, & N: Cover the remaining 20% your client would owe for DME.
• Plan K: Cover 50% of the remaining 20% your client would owe for DME up to the out-of-pocket maximum.
• Plan L: Cover 75% of the remaining 20% your client would owe for DME up to the out-of-pocket maximum.
• All Plans except C and F: Your client will still owe the Part B deductible before any supplemental coverage kicks in.

Since Med Supp coverage of DME falls under Part B coinsurance, you likely won’t see it mentioned in outlines of coverage or on Medigap charts, which can be confusing for agents. As long as the DME is eligible under Original Medicare, Med Supps can help with covering the costs even if not mentioned specifically in plan info.

Since Med Supp coverage of DME falls under Part B coinsurance, you likely won’t see it mentioned in outlines of coverage or on Medigap charts, which can be confusing for agents.

Guiding Your Clients

When your client approaches you with questions about DME coverage, follow these steps to ensure they receive the help they need.

Verify a PCP Order/Prescription

Your client will only receive DME coverage if their primary care provider (PCP) deems it medically necessary. Medicare requires proper documentation to demonstrate medical necessity, meaning your client must get an order or prescription for the DME from their doctor or treating provider. Sometimes, Medicare may require additional documentation.

The equipment supplier will ensure your client’s doctor submits all necessary information to Medicare, so your client shouldn’t have to worry about obtaining or submitting the order, but it’s wise to make your client aware of the requirement and ask them to verify the prescription with their doctor.

Find the Right Equipment Suppliers

This one is very important — not any old equipment supplier will work for obtaining DME! If your client doesn’t source their items from the right supplier, they could owe an exorbitant amount when Medicare refuses to cover the cost. Stick to these pointers for sourcing supplies correctly.

Original Medicare or a Med Supp

If your client is on Original Medicare or a Med Supp, they must get their DME from a Medicare-approved supplier that accepts assignment. Although they technically can purchase DME from a Medicare-approved supplier that does not accept assignment, doing so can lead to higher-than-expected and unpredictable costs.

MA Plan

If your client is on an MA plan, they must adhere to the plan’s rules for sourcing DME. The plan may require that your client:

• Receive approval from the plan before purchasing or renting DME
• Use an in-network supplier (or owe a lot more for using an out-of-network option)
• Use a preferred brand (or pay more for using a non-preferred brand)

Remember, if a supplier doesn’t have a supplier number, Medicare won’t pay the claim!

Define Medicare-Approved Amount

Medicare-approved amounts are tricky and are worth mentioning to your clients, so they aren’t shocked if a supplier bills them for more than 20 percent of the DME’s sticker price. Medicare will only cover 80 percent of what they evaluate as the proper amount, not necessarily 80 percent of what the supplier charges (if the supplier charges in excess).

When a supplier accepts assignment, they agree to cooperate with Medicare-approved amounts. But a supplier can be Medicare-enrolled and non-participating, meaning they could bill a beneficiary for more than the Medicare-approved amount. No wonder clients may get confused!

Let’s return to that client needing a walker. Here are three scenarios of how it could play out:

Although every supplier is charging $200 for the walker, it’s cheapest for your client to choose Supplier ABC, since they are enrolled and accept assignment.

If your client only sources equipment from Medicare-approved suppliers that accept assignment, then they shouldn’t ever be surprised by a higher-than-expected bill, but this illustration shows just how important it is to find suppliers that tick both boxes.

It’s imperative that your clients find suppliers both enrolled in Medicare and accepting assignment.

Recommend the Best Plan

Depending on your client’s need for DME, certain plans, like an MA plan providing additional coverage and support, may be a better fit over Original Medicare paired with a Med Supp, since your client could enjoy a lower premium with 100 percent DME coverage. Or maybe the Med Supp would be a better fit, since the MA plan you offer doesn’t provide additional coverage and they need the full 20 percent supplemental Part B coverage for an expensive piece of DME.

When a client approaches you for help, not only can you assist them in the moment, but you can also take a step back and consider their plan in general. Perhaps a new need for DME warrants revisiting their plan choice come AEP.

Know the Basics and Where to Learn More

It’s not a question of whether you’ll have a client who needs DME, it’s when. Help them navigate the confusing world of Medicare DME coverage by becoming well versed in the basics yourself and educating them on the proper steps they need to take.

For additional information about renting vs. purchasing, replacement parts, special rules for certain types of equipment, and what to do if a supplier leaves Medicare, explore Medicare.gov’s official booklet and Medicare Interactive’s extensive online resource.

We’re also here as a top FMO to help you learn the ins and outs of Medicare coverages and more. Register with Ritter for free to unlock personalized support, proprietary technology, and extensive resources.