Medicare & Durable Medical Equipment: Benefits, Limits & Suppliers

Do Medicare’s Benefits Include Home / Durable Medical Equipment?

The short answer is, yes, Medicare does pay for Durable Medical Equipment (DME). However, before a thorough discussion of the details, it is important to be aware of the different types of Medicare coverage, as the benefits differ based on one’s type of coverage. Medicare Part A is hospital insurance and Part B is for medical outpatient services. (Part A and Part B are sometimes referred to as Original Medicare). Part C (also called Medicare Advantage or MA) combines Part A and Part B and generally offers additional benefits, such as vision and dental. Part C is sold by private companies, rather than provided by the government. Medicare Part D is for prescription drugs and is not relevant to the discussions of DME.

Part A covers medical equipment for individuals who are in a skilled nursing facility or in the hospital. If the equipment is medically necessary and purchased from an approved supplier, Medicare Part A will pay for 80% (if one’s annual deductible has been met) of the allowable amount for any specific item. The individual or their supplemental insurance is responsible for paying for the remaining 20% and any amount over the allowable limit.

Part B pays for medical equipment (and supplies) to be used in one’s home for most Medicare recipients, even if they are not confined to their home. In addition to one’s private home, a personal care residence, such as an assisted living facility, can be considered one’s “home.” A nursing home does not qualify as one’s home. Home medical equipment must be medically necessary, prescribed by a Medicare-enrolled physician, and purchased from a Medicare-approved supplier. Medicare Part B pays for 80% (if one’s annual deductible has been met) of the allowable purchase price. The individual or their supplemental insurance is responsible for the remaining 20% and any amount over the allowable limit.

Part C, as mentioned before, is also known as Medicare Advantage. It is required by law to provide, at a minimum, the same coverage as Part A and Part B. Thus, if one has Medicare Part C, their plan will pay at least 80% of the allowable limit for durable medical equipment.

Types of DME Covered by Medicare

It is best to think of Medicare’s durable medical equipment coverage as having 2 levels. DME that is covered when determined to be medically necessary, and DME that is never covered despite being medically necessary. For example, grab bar rails may be completely necessary for an individual, but Medicare does not consider them to be medical equipment and therefore, will not cover the cost.

The table below lists commonly requested durable medical equipment, if it is covered and, if not, Medicare’s reason for denying coverage. This list is by no means exhaustive. Rather, it is meant to provide the reader with a sense of Medicare’s logic so that it can be applied to one’s own situation.

What are Medicare Suppliers vs. Medicare Participating Suppliers?

Medicare Participating Suppliers are suppliers that have agreed to accept “assignment.” Assignment is the Medicare approved price for a specific item of DME. Purchasing from a Medicare Participating Supplier ensures the individual will not pay more than the 20% co-pay of the Medicare approved price for an item. This is usually the least expensive route for Medicare beneficiaries.

Medicare Suppliers are enrolled in Medicare’s program. This means they will accept Medicare as a form of payment, but they don’t have to accept “assignment.” This means they have the flexibility to set their own prices, but they can still choose to accept “assignment.” By using a Medicare Supplier, the individual may or may not spend the least amount out-of-pocket.

There are also DME Suppliers that are not approved by Medicare. If one purchases from these suppliers, Medicare will not pay any portion of the cost. Thus, before purchasing DME, it is important to ensure DME Suppliers are approved by Medicare and that they accept “assignment.”

Finding Medicare Approved Suppliers

Medicare provides a searchable database of all approved suppliers. One can search by item type and by zip code. Results can be sorted to show Participating Suppliers first. Search for Medicare Approved Suppliers.

Renting vs. Buying Medical Equipment with Medicare

Typically, the decision to rent versus buy is not made by the individual. Instead, Medicare makes this decision. In most cases, Medicare will rent the equipment and will only buy inexpensive DME or equipment that must be custom made. Often, renting works to the individual’s benefit, as they do not have to spend additional money should an item break or need repairs. The Medicare-approved supplier will inform the individual if the item they need is available for rent or purchase.

What are Medicare’s Allowable Limits for Home Medical Equipment?

Medicare has determined the maximum dollar amount their Participating Suppliers are allowed to charge for any particular item of home medical equipment. This is referred to as the “allowable limit.” Medicare updates this regularly and communicates this information to all their suppliers.

Ensuring suppliers only charge the allowable limit is a self-regulating process in that Medicare will only reimburse suppliers the allowed amount. If suppliers attempt to bill for more than the allowable limit, they run the risk of not being reimbursed at all.

What is Upgraded Equipment and How Does One Purchase it with Medicare?

Typically, when Medicare approves an item of durable medical equipment, they will approve only the most basic item available. For example, Medicare may approve the purchase of a walker, but not one with wheels and a hand brake; this would be considered “upgraded equipment.”

It is possible that an upgrade is medically necessary, and if so, Medicare will pay for its part of the upgrade cost. One’s prescription must state specifically the medical reason why an upgrade is necessary. For example, the individual does not have the physical strength or balance required to lift a standard walker, and therefore, one with wheels is required.

Upgrades are also possible simply because the individual prefers a different model. However, in this situation, Medicare will not pay the added cost. Instead, the individual or supplier is responsible for making up the difference. Medicare has developed a specific process for this situation to help avoid fraud and abuse.

When an upgrade occurs, the supplier provides the individual with a document called an Advance Beneficiary Notice of Noncoverage (ABN), which requires their signature. The ABN states the nature of the upgrade and that the individual is responsible for the added cost. It is worth noting that sometimes suppliers will reduce the cost of the upgraded equipment in order to make a sale. Purchasers should not hesitate to ask for this reduction. The supplier then provides the ABN to Medicare when requesting reimbursement.

We do not offer every plan available in your area. Any information we provide is limited to those plans we do offer in your area. Please contact Medicare.gov or 1-800-MEDICARE to get information on all of your options.