Suppliers must ensure that the beneficiary-owned equipment information is on file with Medicare Fee- for-Service (FFS) to avoid denials. Suppliers are reminded that additional documentation is required in situations where supplies and accessories are provided for a piece of equipment not paid for by Medicare FFS. In addition, drugs used with a nebulizer or external infusion pump would be considered supplies to a covered piece of DME.

Examples of items beneficiary owned are Positive Airway Pressure (PAP) devices, BiPAPs, nebulizers, all glucose monitors, and humidifiers, etc.

When the beneficiary-owned item is not on file with Medicare FFS and claims for supplies and accessories used with that item are billed to the DME MAC, the beneficiary owned information must be placed on file with Medicare. The information required is:

• Beneficiary owned item HCPCS; approximate purchased month and year
  • Good example: Bene-owned E0601 pur Jan 2021 (approximate)

Methods to Place Information on File for Claims Processing

• If a denial is received with Reason Code 16, Remark Code M124 and to avoid adding narrative to every claim
  • Telephone reopening through the Supplier Contact Center - Request beneficiary owned equipment information be placed on file for accessories or supplies being billed for those items.
  • Written reopening
    • NMP appeals process
    • Mail
    • Fax
• Add required information to the narrative of every claim line for supplies
  • Item 19 of the 1500 claim form or the 2400/NTE segment of an electronic claim until the base item has been placed on file. Claims lacking any one of the elements above will be denied for missing information.

Avoiding Denials

To avoid a denial for missing indication of whether the beneficiary owns the equipment that requires the accessory or supply, (and the supplier does not know if the equipment is owned or being rented), utilize the same or similar function on the Noridian Medicare Portal (NMP) or the Interactive Voice Response (IVR) system to verify if the base item is on file with Medicare.

Once the beneficiary-owned item is placed on file, subsequent supply claims do not require a narrative.