Home Health & Hospice Week

Expect less support during rental periods.

Suppliers now have at least a few answers about how Medicare plans to pay them to keep capped-rental medical equipment in good working order.

Background: The Deficit Reduction Act of 2005 created a 13-month capped rental payment period for certain items of durable medical equipment and a 36-month capped rental period for oxygen equipment.

After 13 months, the beneficiary owns the capped-rental DME item. After that, Medicare pays for reasonable and necessary repairs and servicing of the item, such as parts and labor not covered by the manufacturer's warranty. A 36-month period applies to capped-rental oxygen equipment.

Missing link: But until now, Medicare had not spelled out what it would cover under the "maintenance and servicing payment" provisions.

Key points: Medicare will no longer pay every six months for maintenance and servicing of capped-rental items--except for oxygen equipment, the Centers for Medicare & Medicaid Services says in Feb. 2 Transmittal 1177. Once the beneficiary owns the capped-rental item, Medicare will cover "reasonable and necessary" repairs and services, according to the transmittal based on a final rule published Nov. 9, 2006.

Mark your calendar: Though the transmittal lists an implementation date of July 2, 2007, claims for repairs and servicing for capped rental items are payable beginning Feb. 1, 2007, according to CMS. Medicare will pay claims for repairs and servicing for oxygen equipment beginning Jan. 1, 2009. Payments for maintenance and servicing for oxygen equipment will kick in beginning July 1, 2009.

Note: Transmittal 1177 is available at www.cms.hhs.gov/transmittals/downloads/R1177CP.pdf.