Medicare, Capped Rentals and Other Mysteries

As we continue our series on understanding Medicare, we focus this week on the phenomenon called “capped rentals.” We mentioned them earlier when we spoke about how Medicare covers manual wheelchairs. It’s a kind of “rent to own” program, designed to deal with the fact that people sometimes need certain types of equipment temporarily. Hospital beds, also known as patient beds, also fall into this category, as do TENS units, patient lifts and oxygen.

Here’s how the “capped rental” process works. You still need all the documentation required from your physician explaining why you need the equipment. As outlined in our previous blogs, the physician’s chart notes must clarify the diagnosis and length of need as well as other details of your condition. For items specified as “capped rentals you work directly with the provider or dealer of the equipment who sets up a rental agreement. If you qualify for Medicare coverage, you have up to 13 months of coverage from Medicare. As with all Medicare coverage, providers/dealers are authorized to bill Medicare either through assignment or non-assignment. Assignment means that the provider/dealer is reimbursed directly by Medicare for up to 80% of the “capped rental” costs. Non-assignment means that you, the consumer, are reimbursed. You pay for the rental of the equipment directly to the provider/dealer and you receive the reimbursement of up to 80% of the rental costs from Medicare directly. In all cases there are agreements that specify terms of the capped rental arrangement. The provider/dealer explains which terms (assigned or non-assigned) and works with you and your physician to complete the necessary paperwork.

After 10 months of reimbursement from Medicare you have the option to buy the equipment. If you decide to purchase the item, the supplier transfers ownership of the item to you following the 13th rental month. The decision to buy the equipment changes the rental payments to installment payments. Remember, if you decide to continue renting the equipment, Medicare will stop paying for the equipment following the 13th month, except for certain service and maintenance.

It is usually quite clear after that 10 month period whether you will continue needing the equipment. It is important to discuss these needs with your physician and the provider/dealer with whom you are working. At Capabilities, we stay in touch with our customers through the billing process. We make reminder calls when the monthly rental period is due for renewal and conduct the renewal process over the phone through the use of credit card transactions. Each provider/dealer will have a specific process to follow.

If you do not have need of the equipment after the 10 month rental period, you are obligated to return it to the provider/dealer. Your physician or other health care professional will help you determine your needs.

At Capabilities we rent manual wheelchairs, TENS units, patient beds (semi-electric only are covered by Medicare), and patient lifts. As a Medicare provider, we accept these items on non-assignment, which means that we expect payment for the rental term from you before delivery of the equipment and submit billing on a complimentary basis to Medicare. As with all Medicare claims, we help you and your physician complete the extensive paperwork required to determine your eligibility.

Please contact us through email or a post here to ask your questions about capped rentals, Medicare and any other insurance-related question you might have. At Capabilities we pride ourselves on being a source of information and resources as well as the provider of one of the largest selections of products for health, comfort and independence.