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DME Billing Services
DME billing is a purchase or a capped rental, the modifier, and the order that replaced the certificate of medical necessity. Vector Medical Billing, in Jamaica, New York, bills month 1 as the first rental month, stops when the 13 months are paid, and does not attach a retired form to a current Medicare claim.
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What DME billing includes
Full-cycle RCM for the supplier — purchase or rental, the modifier for that payment category, and the order in the chart.
The operating cycle matches medical billing services: eligibility, charge capture from the delivery, coding, scrub, clearinghouse submission, payment posting, denial management, and A/R follow-up. The scrub watches whether the item is a purchase or a capped rental, which rental month this is, whether the standard written order was in hand before the claim, and whether proof of delivery matches the date of service.
In scope: equipment the patient uses at home that Medicare or another plan pays as DME, including the monthly rental, a new or used purchase, and repairs after the patient owns the item. A drug the patient picks up stays on pharmacy billing. Transport is a separate page. This is not an office visit with a wheelchair code added.
DME is priced as a percentage of net collections because rental months, purchase modifiers, and medical-necessity documentation take extra scrub time. The written rate follows equipment mix — see pricing. Credentialing the supplier, a retrospective coding audit, and out-of-network / IDR stay separate engagements.
What sits on this DME fee
- Purchase or capped rental, with the month modifier
- Standard written order, chart, and proof of delivery
- HIPAA workflows, a signed BAA, and PHI limited to staff on the account
Where DME claims fail
Patterns in Medicare’s DME payment categories and in the documentation rules that replaced the old forms.
Month 14 of a 13-month rental
Capped rental billed again after 13 continuous months were paid. Or every month sent with only RR, so the payer cannot see whether this is month 1 or month 8. A walker, which the patient may buy or rent as inexpensive equipment, billed as a 13-month capped rental.
Hub rule: purchase or capped rental, and the modifier that matches.
A retired form on a current claim
A certificate of medical necessity attached to a Medicare claim with a date of service on or after January 1, 2023. CMS stopped accepting those forms and the old DME information forms. The order in the chart was never obtained, or it has no signature.
Necessity is the standard written order and the medical record, not the discontinued form.
No proof the patient received it
The claim date is the day the ticket was created, not the day the patient got the item. The delivery note has no quantity or no description. KX is on the line and the coverage criteria in that policy are not in the file. A second similar item is billed during the reasonable useful lifetime of the first one.
Delivery, the order, and continued use have to be in the file before the claim.
13 months · then the patient owns it
Purchase or capped rental
Hub language made operational: the payment category picks the modifier. RR alone does not tell the month.
Capped rental items are paid by the month for a continuous period of not more than 13 months. Month 1 is modifier KH. Months 2 and 3 are KI. Months 4 through 13 are KJ. RR may be reported with the month modifier. RR by itself, on every month, does not show where the rental is in the cap. Medicare prices the first three rental months at 10 percent of the purchase allowance and the later months at 7.5 percent, on assigned claims for new equipment. On the first day after 13 continuous rental months have been paid, the supplier transfers title. Do not bill a 14th rental month. A temporary gap does not restart the clock. The break has to be longer than 60 consecutive days, plus the days left in the rental month when use stopped, before a new 13-month period begins.
During the 10th continuous month the supplier tells the beneficiary they may switch toward purchase. The DME MAC makes no further rental payments after the 11th month until the supplier reports that this offer was made. For power mobility devices and enteral or parenteral pumps, BR means the beneficiary chose to keep renting and BP means they chose purchase. If they choose purchase, rental payments still run through 13 months, and then title transfers. A purchase of new equipment is NU. Used equipment is UE. On an assigned purchase claim, if neither is present, the MAC treats the item as used and pays the used fee. KH is not required on a purchase with a date of service on or after October 1, 2018. Inexpensive or routinely purchased items — canes, walkers, and the other items in that category — are not capped rentals. The beneficiary chooses purchase or rental, reported with BP, BR, or BU if 30 days pass with no choice. Oxygen and some other equipment use a different rental length. Do not put the 13-month modifiers on a category that is not capped rental.
Modifier checklist
- KH, then KI, then KJ, with RR, through month 13
- NU or UE on a purchase
- Stop rental when title has transferred
The order that replaced the certificate
For Medicare dates of service on or after January 1, 2023, the form is not submitted. The record still has to prove necessity.
Standard written order
CMS discontinued certificates of medical necessity and DME information forms for dates of service on or after January 1, 2023. A claim that still carries the form, or the old electronic fields, can be returned. What Medicare requires instead is a standard written order in the supplier’s hands before the claim is submitted: the patient’s name or Medicare number, the order date, a description of the item (words, a HCPCS code, or a brand and model), the quantity when supplies are ordered, and the treating practitioner’s name or NPI and signature. Signature stamps do not count. Items on the written-order-prior-to-delivery list need that order before delivery. The medical record has to support need, and for an ongoing rental it has to support continued need and continued use. A commercial plan may still ask for its own form. That request is that contract, not a reason to put a CMN back on a current Medicare claim.
Proof of delivery
Medicare’s documentation list is the order, the medical record, correct coding, and proof of delivery. The proof names the beneficiary, the delivery address, the quantity, a description of the item, and the date. For an item handed to the patient, the date of service is the date they received it, and the note needs their signature or a designee’s. For a shipment, the date of service is the ship date, the date the label was created, the pickup date, or the delivery date, and the file has to tie the supplier’s papers to the carrier’s tracking. Keep the proof for seven years from the date of service. KX means every coverage criterion in that item’s policy is met and the file can show it. KX does not create necessity. If denial is expected, GA belongs only with a valid advance beneficiary notice. GZ is the expected denial when there is no valid notice, and the patient is not billed. Do not put KX and GA on the same line.
DME claim patterns this service works
Illustrative anchors — the payment category and that item’s policy decide the line. Ambulance transport is not on this page.
| Work type | Example | What to check | Common failure if skipped |
|---|---|---|---|
| Capped rental, month 1 | KH and RR | Order already in hand | RR only |
| Months 2–3 | KI and RR | Continuous use | KH repeated |
| Months 4–13 | KJ and RR | Purchase offer at month 10 | Rental after month 13 |
| New purchase | NU | Not a rental modifier | Paid as used if NU is missing |
| Used purchase | UE | Actually used equipment | NU on a used item |
| Inexpensive item | BP, BR, or BU | Not the 13-month cap | Walker billed as KJ |
| Criteria met | KX when that policy requires it | Chart supports every criterion | KX with no record |
| Expected denial | GA with an ABN, or GZ without one | Not combined with KX | Patient billed on GZ |
This page does not invent a DME denial percentage. The free audit reads your rental months, modifiers, and orders on the sample you send.
What a free audit line looks like
Illustrative composite only — not a client result and not a promised recovery.
| Field | Example entry |
|---|---|
| Documented service | Hospital bed, capped rental. Thirteen continuous months were paid. The patient still has the bed. No break longer than 60 days. Date of service is in 2026. The chart has a standard written order. Delivery was signed on the first day of month 1. |
| Billed codes | Same bed code with KJ and RR for a 14th month, and a certificate of medical necessity attached |
| Issue found | Title transferred the day after month 13. Another rental month is not payable. Medicare does not accept the certificate for a 2026 date of service. |
| Recommended correction | Stop the rental. Bill later repairs only when they are parts and labor outside the warranty, not as month 14. Leave the certificate off. Keep the written order, the continued-use note, and the original proof of delivery in the file. |
| Related check | Month 10 purchase offer was documented before payments after month 11 |
| Why it matters | A rental past the cap, and a retired form, deny or come back — caught in scrub or flagged in the free audit |
Request a Free Audit with recent claims, rental histories, and orders. We map purchase versus rental on your file — not this composite.
How Vector runs DME billing
Which month this is — then the same revenue cycle.
1
Assign DME RCM
Biller who already stops a capped rental at month 13.
2
Reconcile and code
Charge entry and coding from the order and the delivery ticket — queries when the month or the signature is missing.
4
Post and report
Payment posting, denial work, A/R aging, monthly RCM report by rental month and purchase.
Not inside the DME percentage
Related work stays separate so the quote matches the job.
Drugs in or with the device
A drug the patient picks up, or a drug billed on the pharmacy benefit, stays on pharmacy billing. This percentage is the equipment.
Credentialing / audit
Credentialing the supplier and a retrospective coding audit of rental months are separate when scoped.
Underpay / OON
Underpayment recovery and OON / IDR stay separate when the dispute path is not ordinary denial work.
How DME billing is priced
Percentage of dollars that land — not a flat fee per rental month that ignores a cap.
Written rate
DME is priced as a percentage of net collections because rental months, purchase modifiers, and medical-necessity documentation take more scrub time. No setup fee on the monthly cycle. Month to month. The written rate follows equipment mix and how much of the cycle you hand over.
See pricing or request a written rate after the free audit.
What we need to start
Supplier-system access, the DME categories you bill, open rentals if you are leaving another biller, and a sample of modifier, order, or delivery denials. Switching usually overlaps so claim submission does not stop. See EHR integration if access setup needs a separate quote.
Audit the rentals billed after month 13
Send monthly delivery volume, whether you rent or sell, system name, and a sample of modifier or documentation denials. We reply with what the open A/R shows, whether the monthly fee fits, and a written rate — without inventing a clean-claim percentage.
Written
Monthly rate
98%
Published NCR
50
US States
BAA
Every Client
DME billing questions
Straight answers tied to the sections above.
What does DME billing include?
Purchase or capped rental, the modifier for that month, the standard written order and the chart, proof of delivery, submission, posting, denials, and A/R.
How much do DME billing services cost?
The fee is a percentage of net collections. No setup fee on the monthly cycle. The written rate follows equipment mix.
How long is a Medicare capped rental?
Up to 13 continuous months: KH, then KI, then KJ, with RR. Title transfers after month 13 and rental stops. A break longer than 60 consecutive days, plus the rest of that rental month, can start a new period.
Does Medicare still want a certificate of medical necessity?
Not for dates of service on or after January 1, 2023. Sending the old form can get the claim returned. Keep a standard written order, the medical record, and proof of delivery. A commercial plan may still ask for its own form.
Do we have to change our supplier software?
No. Billers work in the system you already use — see EHR integration. Compatibility is confirmed before you commit.
Where does Vector provide DME billing?
The office is 15717 85th St, Jamaica, NY 11414-2620. Work is remote for suppliers in all 50 states. See the specialties hub.
Is Vector Medical Billing HIPAA certified?
HHS does not certify billing companies. Vector signs a BAA, limits PHI to staff on the account, and follows HIPAA workflows. A HIPAA security risk analysis is a separate engagement when scoped.