Accessories and Supplies Used with Beneficiary-Owned Equipment

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.

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 claim narrative must include all three elements listed below. Claims lacking any one of these elements will be denied for missing information.

Claim Narrative Required Elements

Add the narrative to each claim line, 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. The narrative must be specific for the claims processing system to read the beneficiary owned equipment. The common abbreviations to use as narratives may be utilized.

Good example: Bene-owned E0601 pur Jan 2021

  • A notation equipment is beneficiary-owned; and,
  • HCPCS code of base equipment; and
  • Date beneficiary obtained equipment (approximate)

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 the base item on file with Medicare. If the base item is not on file, add a narrative to each claim line with the beneficiary-owned information required elements. This should be added to item 19 of the 1500 claim form or the 2400/NTE segment of an electronic claim.

Resolving Denials

If a denial is received with Reason Code 16, Remark Code M124 that states: missing indication of whether the patient owns the equipment that requires the part or supply, the supplier must provide that information to Medicare to place on file. This can be accomplished in the following ways:

The information that must be put on file includes the claim narrative required elements listed above.

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


Last Updated Fri, 23 Sep 2022 17:07:35 +0000