Scenario: The Rent/Purchase Option (Rev. 1, 10-01-03)

by  Jared Staheli
June 17th, 2015

You have been renting your (specify the item(s) of equipment) for 10 continuous rental months. Medicare requires (specify name of supplier) to give you the option of converting your rental agreement to a purchase agreement. This means that if you accept this option, you would own the medical equipment. If you accept the purchase option, Medicare continues making rental payments for your equipment for 3 additional rental months. You are responsible for the 20 percent coinsurance amounts and, for unassigned claims, the balance between the Medicare allowed amount and the supplier's charge. After making these additional rental payments, title to the equipment is transferred to you. You have until (specify the date one month from the date the supplier notifies the patient of this option) to elect the purchase option. If you decide not to elect the purchase option, Medicare continues making rental payments for an additional 5 rental months, a total of 15 months. You are responsible for the 20 percent coinsurance amounts and, for unassigned claims, the balance between the Medicare allowed amount and the supplier's charge. After a total of 15 rental months have been paid, title to the equipment remains with the medical equipment supplier; however, the supplier may not charge you any additional rental amounts.

In making your decision to rent or purchase the equipment, you should know that for purchased equipment your supplier may charge you each time your equipment is actually serviced. You are responsible for the 20 percent coinsurance amounts and, for unassigned claims, the balance between the Medicare allowed amount and the supplier's charge. However, for equipment that is rented for 15 months, your responsibility for such service is limited to 20 percent coinsurance on a maintenance and servicing fee payable twice per year whether or not the equipment is actually serviced.

References:

Scenario: The Rent/Purchase Option (Rev. 1, 10-01-03). (2015, June 17). Find-A-Code Articles. Retrieved from https://www.findacode.com/articles/scenario-the-rent-purchase-option-26689.html

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