(Medicare Claims Processing Manual)

30.5.3 - Additional Purchase Option for Electric Wheelchairs  (Rev. 1, 10- 01-03)  Effective May 1, 1991, suppliers must give beneficiaries entitled to electric wheelchairs the option of purchasing them at the time the supplier first furnishes the item.  DME MACs or A/B MACs (HHH) make no rental payment for the first month for electric wheelchairs until the supplier notifies the MAC that it has given the beneficiary the option of either purchasing or renting.  Information contained in Exhibit 2 may be furnished to beneficiaries by suppliers to help them make a rent/purchase decision.  MAC s provide copies of Exhibit 2 to suppliers.  Payment must be on a lump- sum fee schedule purchase basis where the beneficiary chooses the purchase option.  If the beneficiary declines to purchase the electric wheelchair initially, MACs make rental payments in the same manner as any other capped rental item, including the instructions in 30.5.2.  30.5.3.1 - Exhibits  (Rev. 1, 10- 01-03)  Exhibit 1 -  The Rent/Purchase Option   You have been renting your (specify the item(s) of equipment) for 10 continuous rental months.  Medicare requires (specify name of supplier) to give you the option of converting your rental agreement to a purchase agreement.  This means that if you accept this option, you would own the medical equipment.  If you accept the purchase option, Medicare continues making rental payments for your equipment for 3 additional rental months.  You are responsible for the 20 percent coinsurance amounts and, for unassigned claims, the balance between the Medicare allowed amount and the supplier's charge.  After making these additional rental payments, title to the equipment is transferred to you.  You have until (specify the date one month from the date the supplier notif ies the patient of this option) to elect the purchase option.  If you decide not to elect the purchase option, Medicare continues making rental payments for an additional 5 rental months, a total of 15 months.  You are responsible for the 20 percent coinsurance amounts and, for unassigned claims, the balance between the Medicare allowed amount and the supplier's charge.  After a total of 15 rental months have been paid, title to the equipment remains with the medical equipment supplier; however, the supplie r may not charge you any additional rental amounts.  In making your decision to rent or purchase the equipment, you should know that for purchased equipment your supplier may charge you each time your equipment is actually serviced.  You are responsible for the 20 percent coinsurance amounts and, for unassigned claims, the balance between the Medicare allowed amount and the supplier's charge.  However, for equipment that is rented for 15 months, your responsibility for such service is limited to 20 percent coinsurance on a maintenance and servicing fee payabl e twice per year whether or not the equipment is actually serviced.   Exhibit 2 - How Medicare Pays For Electric Wheelchairs  (Rev. 1, 10- 01-03)  If you need an electric wheelchair prescribed by your doctor, you may already know that Medicare can help pay for it.  Medicare requires (specify name of supplier) to give you the option of either renting or purchasing it.  If you decide that purchase is m ore economical, for example, because you will need the electric wheelchair for a long time, Medicare pays 80 percent of the allowed purchase price in a lump sum amount.  You are responsible for the 20 percent coinsurance amounts and, for unassigned claims, the balance between the Medicare allowed amount and the supplier's charge.  However, you must elect to purchase the electric wheelchair at the time your medical equipment supplier furnishes you the item.  If you elect to rent the electric wheelchair, you are again given the option of purchasing it during your 10th rental month.  If you continue to rent the electric wheelchair for 10 months, Medicare requires (specify name of supplier) to give you the option of converting your rental agreement to a purchase agreement.  This means that if you accept this option, you would own the medical equipment.  If you accept the purchase option, Medicare continues making rental payments for your equipment for 3 additional rental months.  You are responsible for the 20 percent coinsurance amounts and, for unassigned claims, the balance between the Medicare allowed amount and the supplier's charge.  After these additional rental payments are made, title to the equipment is transferred to you.  You have until (specify the date one month from the date the supplier notifies the patient of this option)  to elect the purchase option.  If you decide not to elect the purchase option, Medicare continues making rental payments for an additional 5 rental months, a total of 15 months.  After a total of 15 rental months have been paid, title to the equipment rem ains with the medical equipment supplier; however, the supplier may not charge you any additional rental amounts.  In making your decision to rent or purchase the equipment, you should know that for purchased equipment, you are responsible for 20 percent of the service charge each time your equipment is actually serviced and, for unassigned claims, the balance between the Medicare allowed amount and the supplier's charge.  However, for equipment that is rented for 15 months, your responsibility for such service is limited to 20 percent coinsurance on a maintenance and servicing fee payable twice per year whether or not the equipment is actually serviced.   30.5.4 - Payments for Capped Rental Items During a Period of Continuous Use  (Rev. 1, 10- 01-03)  When no purchase options have been exercised, rental payments may not exceed a period of continuous use of longer than 15 months.  For the month of death or discontinuance of use, DME MACs and A/B MACs (HHH) pay the full month rental.  After 15 months of rental have been paid, the supplier must continue to provide the item without any charge, other than for the maintenance and servicing fees (see  40.2) until medical necessity ends or Medicare coverage ceases (e.g., the patient enrolls in an M+C organization).  For this purpose, unless there is a break in need for at least 60 days, medical necessity is presumed to continue.  If a supplier makes any addi tional rental charges, DME MACs and A/B MACs (HHH) should report questionable situations to the RO of the Inspector General.   A period of continuous use allows for temporary interruptions in the use of equipment.  Interruptions may last up to 60 consecutive days plus the days remaining in the rental month (this does not mean calendar month, but the 30- day rental period) in which use ceases, regardless of the reason the interruption occurs.  Thus, if the interruption is less than 60 consecutive days plus the days remaining in the rental month in which use ceases, DME MACs and A/B MACs (HHH) will not begin a new 15 -month rental peri od.  Also, when an interruption continues beyond the end of the rental month in which the use ceases, MACs will not make payment for additional rental until use of the item resumes.  MACs will establish a new date of service when use resumes.  Unpaid months of interruption do not count toward the 15- month limit.   EXAMPLE:  A patient rents an item of equipment for 12 months and is then institutionalized for 45 days.  Upon his discharge from the institution, the patient resumes use of the equipment and is considered to be in his 13th month of rental (since the period of institutionalization is not counted) for purposes of calculating the 15- month rental period.  Moreover, for the period he was institutionalized, no payment is made for the item of equipment.  If the supplier desires, it may pick up the item of equipment during the patient's hospitalization but is required to return the item upon the patient's return home.  If, however, the interruption is greater than 60 consecutive days (plus the days remaining in the rental month in which need ceases) and the supplier submits a new prescription, new medical necessity documentation and a statement describing the reason for the interruption which shows that medical necessity in the prior episode ended, a new 15-month period begins.  If the supplier does not submit this documentation, a new 15-month period does not begin.  As a general rule, DME MACs and A/B MACs (HHH) accept written documentation from suppliers without further development.  However, although it is expected that such circumstances are limited in number, they do represent an opportunity for abuse.  Therefore,  if a pattern of frequent interruptions in excess of 60 days occurs, MACs will institute a thorough medical review of the supplier's claims.  MACs should report questionable situations to the RO of the Inspector General.  If a 15 -month rental period has already ended and a greater than 60 consecutive day interruption occurs, MACs will subject any claims purporting to be a new period of medical necessity after the interruption to a thorough medical review to ensure that medi cal necessity did in fact end after the prior episode.  Additional issues relating to the term "continuous" follow.   Change of Address   If the beneficiary moves during or after the 15- month period, either permanently or temporarily, it does not result in a new rental episode.  Modifications or Substitutions of Equipment   If the beneficiary changes equipment to different but similar equipment, DME MACs and A/B MACs (HHH) may refer the claim to their medical review unit.  If, after thorough review, they conclude that the beneficiary's medical needs have substantially changed and the new equipment is necessary, DME MACs will begin a new 15 -month period.  The supplier providing equipment during the 10th month must also provide the purchase option.  Otherwise, they will continue to count against the current 15 -month limit and base payment on the least expensive medically appropriate configuration of equipment (if the 15- month period had already expired, they will make no additional rental payments).  The principles are described in the Medicare Benefit Policy Manual, Chapter 15.  If the new configuration is a modification of existing equipment through the addition of medically necessary features (e.g., a special purpose back is added to a wheelchair), DME MACs and A/B MACs will continue the 15- month rental period for the original equipment and begin a new 15- month rental period for the added equipment.  Change in Suppliers   If the beneficiary changes suppliers during or after the 15- month rental period, this does not result in a new rental episode.  For example, if the beneficiary changes suppliers after his 8th rental month, the new supplier is entitled to the monthly rental  fee for seven additional months (15 -  8).  The supplier that provides the item in the 15th month of the rental period is responsible for supplying the equipment and for maintenance and servicing after the 15- month period (see 40.2 ).  30.5.5 - Payment for Power -Operated Vehicles that May Be Appropriately Used as Wheelchair  (Rev. 1, 10- 01-03) B3-5107.1  The allowed payment amount for a power -operated vehicle that may be appropriately used as wheelchair, including all medically necessary accessories, is the lowest  of the:    Actual charge for the power -operated vehicle, or   Fee schedule amount for the power -operated vehicle.