Payment for Maintenance and Service for Non-ESRD Equipment: General (Rev. 1, 10-01-03)

by  Jared Staheli
June 17th, 2015

Contractors pay for maintenance and servicing of purchased equipment in the following classes:

• inexpensive or frequently purchased,

• customized items, other prosthetic and orthotic devices, and

• capped rental items purchased in accordance with §30.5.2 or §30.5.3.

They do not pay for maintenance and servicing of purchased items that require frequent and substantial servicing, or oxygen equipment. (Maintenance and servicing may be paid for purchased items in these two classes if they were purchased prior to June 1, 1989). Reasonable and necessary charges include only those made for parts and labor that are not otherwise covered under a manufacturer's or supplier's warranty. Contractors pay on a lump-sum, as needed basis based on their individual consideration for each item. Payment may not be made for maintenance and servicing of rented equipment other than maintenance and servicing for PEN pumps (under the conditions of §40.3) or the maintenance and servicing fee established for capped rental items in §40.2.

Servicing of equipment that a beneficiary is purchasing or already owns is covered when necessary to make the equipment serviceable. The service charge may include the use of "loaner" equipment where this is required. If the expense for servicing exceeds the estimated expense of purchasing or renting another item of equipment for the remaining period of medical need, no payment can be made for the amount of the excess. Contractors investigate and deny cases suggesting malicious damage, culpable neglect or wrongful disposition of equipment as discussed in BPM Chapter 15 where they determine that it is unreasonable to make program payment under the circumstances. Such cases are referred to the program integrity specialist in the RO.

References:

• Pub 100-04 Medicare Claims Processing Manual