Below is a stereotypical scenario posed to our research team:
“We have a patient who has been on oxygen with us since January 2021. They are two years into the oxygen cap, and each month they accrue about $25 in monthly coinsurance. Because the patient has not been making any payments, that total balance has reached over $400. They will not return any of our calls to set up payment arrangements. I was wondering if because they are not holding up their end of the bargain if we could pick up the equipment? What if anything does the Medicare policy say about this scenario?”
In Many Cases …
Normally, the provision of DME services by a supplier to a beneficiary is a claim-by-claim decision. In many cases, Medicare does not force suppliers to provide services outside of a competitively bid contract. For many types of DME equipment and services, suppliers are permitted to discontinue service for non-payment, similarly to the scenario posed above.
But Oxygen is Different …
The Medicare Oxygen Policy Article states:
“The supplier who provides oxygen equipment for the first month must continue to provide any necessary oxygen equipment and all related items and services through the 36-month rental period.”
The policy article provides for four exceptions to the general rule:
- The beneficiary relocates (temporarily or permanently) outside the supplier’s service area.
- The item becomes subject to competitive bidding.
- The beneficiary elects to obtain oxygen from a different supplier.
- CMS or the DME MACs make an individual case exception.
Unfortunately, none of the above permit suppliers to discontinue oxygen service for nonpayment.
What is an Unpaid Supplier To Do?
In my experience, many of the suppliers that have experimented with collection firms and litigation have found the results inconsistent and unsatisfying. And while urging a non-paying customer to move to a different provider would satisfy one of Medicare’s exceptions for discontinuing service, the likelihood that another provider will want to accept the patient with limited months remaining in the cap is slim.
Perhaps the best practice is to involve intake and resupply teams in the effort. As oxygen users call for new tubing, nasal cannulas, and other supplies, make sure the intake and resupply teams are using those incoming calls to engage the payment discussion and secure payment authorization for past and future bills. Consider:
- Credit card or ACH (e-Check) authorizations.
- Health care financing options such as CareCredit.
Suppliers must be able to communicate with their patients. For those that will not respond to phone calls or written communications, suppliers should send a delivery tech to the non-responsive patient’s home for two reasons:
- Secure payment arrangements, and
- Confirm the patient is still using the equipment.
If suppliers cannot confirm the customer is using the equipment, the patient does not meet Medicare’s continued use requirement and the supplier cannot submit claims for reimbursement on said equipment. If the delivery tech confirms the customer is not using the equipment, that, too, is grounds to take it back.