(Medicare Claims Processing Manual)

If a noncontract supplier does not want to continue furnishing oxygen and oxygen equipment to its existing customers/beneficiaries, the beneficiaries must use a contract supplier to obtain the oxygen and oxygen equipment.  Ordinarily, the title to the oxygen equipment would transfer to the beneficiary after rental payments have been made for 36 months of continuous use.  However, Medicare allows for a minimum of 10 months of payments to be made to a contract supplier for oxygen and oxygen equipment furnished to a beneficiary who changes suppliers under the DMEPOS Competitive Bidding Program because the current supplier chose not to become a grandfathered supplier.  Therefore, under the DMEPOS Competitive Bidding Program, up to 45 continuous payments could be made fo r the oxygen and oxygen equipment.  The beneficiary is liable for co -payments for all paid oxygen and oxygen equipment claims.  50.9 - Billing for Capped Rental DME Items  (Rev. 1544, Issued: 06- 26-08, Effective: 07- 01-08, Implementation: 07- 07-08)  Noncont ract suppliers of capped rental DME equipment may elect to become grandfathered suppliers and continue furnishing equipment to their existing beneficiaries after the start of the DMEPOS Competitive Bidding Program, if the beneficiary agrees to the arrang ement. This grandfathering process only applies to suppliers that began furnishing the capped rental DME item to beneficiaries in a CBA prior to the implementation of the competitive bidding program for that area and choose to continue to furnish the grandfathered item to these same beneficiaries in the CBA after the start of the DMEPOS Competitive Bidding Program.  See 20.6 for additional information on payments to noncontract suppliers.  If a noncontract supplier does not want to continue furnishing capp ed rental DME to its existing customers/beneficiaries after the start of the DMEPOS Competitive Bidding Program, the beneficiary must use a contract supplier to obtain the item. Ordinarily, the title to the capped rental DME item would transfer to the bene ficiary after rental payments have been made for 13 months of continuous use.  However, for beneficiaries that switch from a noncontract supplier to a contract supplier, the 13 month capped rental period starts over again. In this case, Medicare allows for  a minimum of 13 months of rental payments to be made to a contract supplier because their current supplier chose not to become a grandfathered supplier.  Therefore, under DMEPOS Competitive Bidding Program, when a beneficiary switches from a noncontract s upplier to a contract supplier, up to 25 continuous payments could be made for the capped rental DME item.  The beneficiary is liable for co -payments for all paid capped rental DME equipment claims.  50.9.1 - Certificates of Medical Necessity (CMN) and Cap ped Rental Billing  (Rev. 1544, Issued: 06- 26-08, Effective: 07- 01-08, Implementation: 07- 07-08)  Suppliers are not required to obtain a new Certificate of Medical Necessity (CMN) for situations in which a beneficiary who was receiving a capped rental item prior to the implementation of DMEPOS Competitive Bidding goes to a new supplier after the implementation of the DMEPOS Competitive Bidding Program (e.g., the previous supplier decides not to become a grandfathered supplier), unless the beneficiarys medic al necessity for the item has changed.  Notwithstanding this situation, the new supplier shall bill using the appropriate modifiers for their first rental month (KH), the second and third rental months (KI), and all subsequent rental months (KJ).  50.10 - Claims Submitted for Hospitals Who Furnish Competitively Bid Items  (Rev. 2231, Issued: 05- 27-11, Effective: 08- 28-11, Implementation: 08- 28-11)  Under DMEPOS Competitive Bidding, hospitals may furnish certain types of competitively bid DME to their patients on the date of discharge without submitting a bid and being awarded a contract.  The DME items that a hospital may furnish as part of the exception are limited to: crutches, canes, walkers, folding manual wheelchairs, blood glucose monitors, and i nfusion pumps.  Payment for items furnished under this exception will be made based on the single payment amount for the item for the CBA where the beneficiary resides.  Separate payment is not made for walkers and related accessories furnished by a hospit al on the date of admission because payment for these items is included in the Part A payment for inpatient facility services.  Refer to Pub. 100- 04, the Medicare Claims Processing Manual, Chapter 1, 10.1.1.1  for instructions for submitting claims.   50.11 - Claims Submitted for Medicare Beneficiaries Previously Enrolled in a Medicare Advantage Plan  (Rev. 2231, Issued: 05- 27-11, Effective: 08- 28-11, Implementation: 08- 28-11)  Under DMEPOS Competitive Bidding, if a beneficiary resides in a CBA and elects to leave their MA plan or loses his/her coverage under this plan, the beneficiary may continue to receive items requiring frequent and substantial servicing, capped rental, oxygen and oxygen equipment, or inexpensive or routinely purchased rented items from t he same DME supplier under the MA plan without going to a contract supplier under the Medicare DMEPOS Competitive Bidding Program.  However, the supplier from whom the beneficiary previously received the item under the plan must be a Medicare enrolled supplier; meet the Medicare FFS coverage criteria and documentation requirements; and must elect to become a grandfathered supplier.  All competitive bid grandfathering rules apply in these situations.  50.12 - Claims for Repairs and Replacements (Rev. 2231, I ssued: 05 -27-11, Effective: 08- 28-11, Implementation: 08- 28-11)  Under the DMEPOS Competitive Bidding Program, any DMEPOS supplier, provided they have a valid Medicare billing number, can furnish and bill for services (labor and parts) associated with the repair of DME or enteral nutrition equipment owned by beneficiaries who reside in a CBA.  In these situations, Medicare payment for labor will be made based on the standard payment rules.  Medicare payment for claims for replacement parts associated with r epairing competitively bid DME or enteral nutrition equipment, that are submitted with the RB modifier, will be based on the single payment amount for the part if the part and equipment being repaired are included in the same competitive bidding product ca tegory in the CBA.  Otherwise, Medicare payment for replacement parts associated with repairing equipment owned by the beneficiary will be made based on the standard payment rules.   The replacement of an entire item, as opposed to the replacement of a part  for repair purposes, which is subject to the DMEPOS Competitive Bidding Program, must be furnished by a contract supplier.  Medicare payment for the replacement item would be based on the single payment amount for the item in the beneficiarys CBA.  Refer  to Pub. 100- 04, the Medicare Claims Processing Manual, Chapter 20, 10.2 for instructions on submitting claims for repairs and replacements.   50.13 - Billing for Oxygen Contents to Suppliers After the 36th Month Rental Cap (Rev. 2231, Issued: 05- 27-11, Eff ective: 08 -28-11, Implementation: 08- 28-11)  The Medicare law requires that the supplier that furnishes liquid or gaseous oxygen equipment (stationary or portable) for the 36th continuous month must continue to furnish the oxygen contents necessary for the effective use of the liquid or gaseous equipment during any period after the payment cap and of medical need for the remainder of the reasonable useful lifetime established for the equipment.  This requirement continues to apply under the Medicare DMEPOS Competitive Bidding Program, regardless of the role of the supplier (i.e., contract supplier, grandfathered supplier, or non- contract supplier) and the location of the beneficiary (i.e. residing within or outside a CBA).   Should a beneficiary travel or tem porarily relocate to a CBA, the oxygen supplier that received the payment for the 36th continuous month must make arrangements for furnishing oxygen contents with a contract supplier in the CBA in the event that the supplier that received the 36th month pa yment elects to make arrangements for a temporary oxygen contents billing supplier.   The Medicare payment amount is always based on the location in which the beneficiary maintains a permanent residence.  If the beneficiary resides in a CBA, payment for the oxygen contents will be based on the single payment amount for that CBA.  If the beneficiary resides outside of a CBA and travels to a CBA, payment for the oxygen contents will be based on the fee-schedule amount for the area where the beneficiary maintai ns a permanent residence.   50.14 - Purchased Accessories & Supplies for Use With Grandfathered Equipment  (Rev. 2231, Issued: 05- 27-11, Effective: 08- 28-11, Implementation: 08- 28-11)  Non-contract grandfathered suppliers must use the KY modifier on claims for CBA -residing beneficiaries with dates of service on or after January 1, 2011, for purchased, covered accessories or supplies furnished for use with rented grandfathered equipment.  The following HCPCS codes are the codes for which use of the KY modifie r is authorized:    Continuous Positive Airway Pressure Devices, Respiratory Assistive Devices, and Related Supplies and Accessories -  A4604, A7030, A7031, A7032, A7033, A7034, A7035, A7036, A7037, A7038, A7039, A7044, A7045, A7046, E0561, and E0562   Hospita l Beds and Related Accessories -  E0271, E0272, E0280, and E0310    Walkers and Related Accessories -  E0154, E0156, E0157 and E0158   Grandfathered suppliers that submit claims for the payment of the aforementioned purchased accessories and supplies for use wi th grandfathered equipment should submit the applicable single payment amount for the accessory or supply as their submitted charge on the claim.  Non-contract grandfathered suppliers should be aware that purchase claims submitted for these codes without t he KY modifier will be denied.  In addition, claims submitted with the KY modifier for HCPCS codes other than those listed above will be denied.   After the rental payment cap for the grandfathered equipment is reached, the beneficiary must obtain replacement supplies and accessories from a contract supplier.  The supplier of the grandfathered equipment is no longer permitted to furnish the supplies and accessories once the rental payment cap is reached.   50.15 - Hospitals Providing Walkers and Related Acces sories to Their Patients on the Date of Discharge  (Rev. 2231, Issued: 05- 27-11, Effective: 08- 28-11, Implementation: 08- 28-11)  Hospitals may furnish walkers and related accessories to their own patients for use in the home during an admission or on the da te of discharge and receive payment at the applicable single payment amount, regardless of whether the hospital is a contract supplier or not. Separate payment is not made for walkers furnished by a hospital for use in the hospital, as payment for these it ems is included in the Part A payment for inpatient hospital services.  To be paid for walkers as a non- contract supplier, the hospital must use the modifier J4 in combination with the following HCPCS codes: A4636; A4637; E0130; E0135; E0140; E0141; E0143;  E0144; E0147; E0148; E0149; E0154; E0155; E0156; E0157; E0158; and E0159. Under this exception, hospitals are advised to submit the claim for the hospital stay before or on the same day that they submit the claim for the walker to ensure timely and accura te claims processing.   Hospitals that are located outside a CBA that furnish walkers and/or related accessories to travelling beneficiaries who live in a CBA must affix the J4 modifier to claims submitted for these items.   The J4 modifier should not be used by contract suppliers.  50.16 - Exception for Wheelchair Accessories Furnished with Non -Competitively Bid Wheelchair Base Equipment  (Rev.  3324, Issued: 08- 14-15, Effective: 07- 01-13, Implementation: 01- 04-16)  Effective for c laims with dates of service on or after July 1, 2013, competitively bid wheelchair accessories are paid in accordance with standard Medicare DMEPOS payment rules, not competitive bidding rules, when furnished with non- competitively bid wheelchair base equipment.Transmittals Issued for this Chapter