It’s a strong time to enter the market as a supplier of durable medical equipment (DME), as the durable medical equipment market is expected to surpass $76 billion in value by 2026. What’s more, the DME market is essential to serving the medical needs of many different people, including seniors and people with disabilities, which makes it a key component of the standard of care for medical practices that serve these populations.
The ability to bill Medicare is a vitally important component of most DME suppliers’ businesses since Medicare provides health insurance for many of the people who need DME the most. In today’s article, we’ll discuss the basics of how to become a DME supplier and the DMEPOS surety bond requirements that each practice will need to fulfill.
What Is a DME Supplier?
A DME supplier is any business that sells or rents certain types of medical equipment intended for the management of chronic conditions. These types of medical equipment include, but are not limited to:
- Prosthetics and orthotics
- Blood sugar meters and test strips
- Dialysis supplies
- Enteral or parenteral nutrition supplies
- Continuous positive airway pressure (CPAP) devices
- Therapeutic footwear
DME must be prescribed by a medical professional, which is why many medical practices choose to make DME supply part of their business. But many different kinds of businesses, including pharmacies and medical supply businesses, will also want to accept and bill Medicare for DME patients.
How to Become a DME Supplier: The Basic Process
These are the basic steps of how to become a DME supplier, but be sure to read all relevant rules in detail before applying for CMS accreditation. If you’re registering a hospital, home health care service, or another institution, make sure to read CMS’s Medicare enrollment guide for institutional providers.
Apply for a National Provider Identification (NPI) number.
First, you’ll need to ensure that your practice has a valid NPI number to identify your practice in CMS’s record-keeping system. Most providers will already have an NPI number, but providers starting a new practice may not have one yet. To learn about obtaining an NPI, see CMS’s guide to NPIs.
Verify your compliance with CMS quality standards.
Next, your practice will need to verify its compliance with CMS standards for DMEPOS suppliers and ensure that you’re ready to meet the challenges of Medicare billing. Begin by thoroughly reading the DMEPOS Quality Standards from CMS. These rules cover important parts of how to become a DME supplier, such as:
- Administrative and financial structures
- Human resources and performance management
- Patient intake and diagnosis procedures
- Equipment set-up, delivery, and patient instruction
- Additional rules for providers in specialty markets such as respiratory equipment and custom prosthetics
These rules cover many other topics as well, so make sure to read them in full. It’s also important to be familiar with the special DMEPOS payment rules as described in 42 Code of Federal Regulations (CFR) 424.57.
Apply for accreditation through an approved DME accreditation organization.
When your practice is ready to apply for CMS accreditation, you’ll need to contact a CMS-approved accreditation organization (AO) and complete the AO’s accreditation process. In the pre-application process, you’ll work with the AO to make necessary changes in your practices to meet CMS standards.
The DME supplier accreditation process itself will include submitting many documents to the AO, which the AO will typically take four to six months to review. The AO will then conduct an unannounced site visit to your practice and review your compliance. When the AO is satisfied that you’re qualified for accreditation, they will submit your information to the National Supplier Clearinghouse (NSC).
Purchase a DMEPOS surety bond and enroll for Medicare billing privileges through CMS.
Once your AO has confirmed your accreditation, your practice will need to submit the application for Medicare billing privileges to CMS. You’ll use the CMS PECOS system to submit your final application to CMS and the NSC. If you need to check on the status of your application or have other questions about the application process, contact the NSC directly.
One key element of this process is getting a DMEPOS surety bond. The purpose of a surety bond is to provide an accountability mechanism for DME suppliers and help prevent Medicare fraud. CMS requires providers to submit a surety bond with a coverage amount of $50,000 as part of their application.
Your business will need to pay a small percentage of the coverage amount upfront as a premium, and the surety bond cost can vary with your credit score, record as a provider, and other factors. Note that if your practice has multiple locations with different NPI numbers, you’ll need $50,000 of surety bond coverage for every separate NPI.
Surety Bonds Direct can help your practice obtain a DMEPOS surety bond quickly and for an affordable premium. Contact our DMEPOS surety bond specialists by phone at 1-800-608-9950 or get a free DMEPOS surety bond quote online in just a few minutes.