Your 3-Minute Essential Guide to DME Billing

Introduction to Billing for Durable Medical Equipment (DME)

DME billing is widely considered to be a time-consuming and somewhat complex process, requiring a greater deal of effort than other kinds of medical billing practices. However, it needn’t be a tough nut to crack if the biller keeps in mind a few simple rules and follows a streamlined approach.

The chief difficulties a provider faces while billing for DME arise from a failure in providing all the necessary documents that should accompany a claim to the insurance company. The purpose of these documents, broadly speaking, is to clearly establish the medical necessity of the prescribed device or equipment. There are also other aspects to take care of, such as obtaining prior authorization from the patient’s health plan, should the prescribed item require it. Let’s now take a closer look at the main steps in the DME billing process.

Main Steps in DME Billing

One of the first steps in DME billing is collecting all the necessary documents that will eventually be used while filing the claim. These will typically include, but may not be limited to, the

  • Prescription
  • Certificate of Medical Necessity
  • Prior Authorization
  • Proof of Delivery

The last item on the list constitutes a copy of the signed delivery slip. However, the CMS has waived this requirement due to COVID-19 restrictions. Should proof of delivery still be required, a photo of the delivered item is often accepted.

The second step is verifying the patient’s insurance eligibility. This step is important for determining if the patient’s plan covers the prescribed DME.

The next step comprises generating the actual invoice. This step involves adding all pertinent HCPCS (Healthcare Common Procedure Coding System) Level II codes and modifiers for not just the main piece of equipment but also for every other applicable constituent part.

The step that follows is submitting the claim to the concerned insurance. According to the Administrative Simplification Compliance Act (ASCA), all Medicare reimbursement claims need to be filed electronically. However, for small-sized practices, the standard paper claim form (CMS-1500) may be used.

Last but not the least, every time a claim needs to be resubmitted after making required corrections, should be attended to without delay. This is because claim denials or rejections can be costly, and if not managed well, can impact overall collections adversely.