Medical Supply Company Ventures Viable if Navigated Properly


Suppliers of Durable Medical Equipment, Prosthetics and Orthotics, and Supplies (“DMEPOS”) are facing increased scrutiny. With audits and a lack of clarity in the Centers for Medicare & Medicaid Services’ (“CMS”) regulations, DMEPOS suppliers are most likely to be profitable only when properly structured. Suppliers must ensure complete compliance with regulations to avoid repayment risks to both CMS and beneficiaries, as well as revocation of billing privileges and/or revocation of enrollment.Several types of suppliers may be enrolled in Medicare (e.g., medical supply company, ambulatory surgical center, hospital, pharmacy, physician, etc.). In addition to Medicare enrollment, DMEPOS suppliers may also enroll in various Medicaid programs and/or contract with commercial payers. This white paper discusses the different areas of DMEPOS regulation from the perspective of a medical supply company.Medical supply companies may be independent or part of a larger health system. They are subject to a vast number of federal, state, and accreditation requirements no matter the structure. According to CMS, DMEPOS suppliers have the highest percentage of improper payment rates compared to other Medicare claim types.1 In part, these improper payment rates are due to the extremely complex and often ambiguous regulatory structure that applies to DMEPOS suppliers. Therefore, it is imperative that medical supply companies establish and maintain a baseline of compliance with these complex standards. While this white paper will focus on Medicare requirements, medical supply companies enrolling in Medicaid programs or contracting with commercial payers should also be mindful of the requirements set out by those respective programs and/or contracts.

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