Nebraska Law Complicates Non-Assigned Medicare Claims, Raises Concerns for DMEPOS Providers

HME providers in Nebraska are facing new regulations regarding how they handle non-assigned Medicare claims, following successful lobbying efforts by Mutual of Omaha and the Nebraska Insurance Federation. A law, effective as of July, restricts nonparticipating Medicare providers from “balance billing” beneficiaries for DMEPOS unless the beneficiary (1) consents in writing beforehand and (2) pays the full amount before receiving the equipment. 

“You can still collect upfront if these two conditions are met,” said Rose Schafhauser, executive director of the Midwest Association for Medical Equipment Services. She noted, however, that most people won’t want to pay out of pocket when they have comprehensive supplemental insurance. As a result, patient access to necessary equipment could be negatively impacted. Schafhauser emphasized that the real concern and pushback should come from patients. 

This new law, revised partially due to advocacy from MAMES, is considered an improvement over an earlier version that would have capped charges to beneficiaries and supplemental insurers at 15% over the Medicare-approved amount with no exceptions. 

Nonetheless, the law places providers in a difficult position, according to Brent White, general manager of Nebraska Scooter Mart. Since the law took effect, White has had to inform 12 customers that they need to either pay out of pocket or choose less expensive equipment, a situation that’s left no one satisfied.  

White and Schafhauser both suspect that similar laws could appear in other states, as the Nebraska Insurance Federation worked closely with its national association. In 2022, supplemental insurers paid $2.5 million in excess charges for DME, a figure that rose to $4 million in 2023, making the financial implications of the new law significant nationwide.