CurrentHumanaPolicy CP2024013
Durable Medical Equipment (DME) for Medicare Advantage
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Governs Humana's billing requirements and reimbursement rules for DME supplied to Medicare Advantage members, including rental vs purchase, capped rental items, oxygen, TENS units, supplies, maintenance, and related modifiers. Applies to providers billing Humana MA products.
Policy Summary
PayerHumana
PolicyDurable Medical Equipment (DME) for Medicare Advantage
Policy CodePolicy CP2024013
Change TypeNo material changes
Effective DateOct 1, 2025
Next Review Date
Key ActionSubmit rental charges with modifier RR or purchase charges with NU/UE as appropriate and follow prior authorization/referral requirements when applicable.
SourceLink
POLICY UPDATE CHANGES
No material clinical or coverage changes in this revision.
13max rental before purchase
36oxygen rental months
2TENS trial
10%/7.5%non-power wheelchair rent %
15%/6%power wheelchair rent %
multiplemodifiers listed
Coverage criteria and rental/purchase rules
Coverage criteria and payment rules
Humana allows DME consistent with applicable CMS guidance; payments are subject to medical necessity, reasonableness, and any applicable referral or authorization requirements.
Follow applicable CMS guidance for DME; claims are subject to medical necessity, reasonableness, and applicable referral/authorization requirements.
For a DME item that can be rented or purchased, whether the item is rented or purchased is subject to any applicable referral or prior authorization determination.
If a charge for a covered DME item is submitted with purchase modifier NU, the amount allowed is the new equipment purchase rate; if submitted with UE, the amount allowed is the used equipment purchase rate (used typically reimbursed at a reduced rate, typically 75% of new).
When a capped rental DME item is billed with modifier RR, the amount allowed is the monthly rental rate; if no Medicare rental rate exists Humana will apply a contracted rental rate or may allow the item at the purchase rate if no contracted rental rate exists.
Reimbursement for a DME item includes delivery and set-up; Humana does not reimburse separately for delivery and set-up.
Reimbursed services are subject to the same special pricing rules that apply to Original Medicare (for example, Competitive Bidding Program rates where applicable).
DME rental/purchase/replacement criteria
Coverage and payment conditions for rental, purchase, and replacement of DME items.
Maximum continuous rental period for most capped rental DME items is 13 months; the two-month TENS rental trial does not count toward the 13-month rental period.
An item is considered purchased in the month in which the total of all amounts allowed equals the applicable purchase amount for that item or when rental exceeds the 13-month rental period; the two-month rental trial period for TENS does not count toward the purchase amount or rental month calculation.
Replacement after the Reasonable Useful Lifetime (RUL) may be reimbursed if the item is still medically necessary but no longer functional, and all of the following are met: maximum allowed units not exceeded; replacement cost (including labor/parts) does not exceed cost of renting or purchasing a new base item; replacement not due to intentional damage/neglect/misuse; same member owns the base item; item is not under warranty (documentation of expired/denied warranty required upon request); and the base item/part/accessory is not currently being rented.
Replacement before RUL allowed if
- Member's medical needs have changed such that a different item is medically necessary.
- Item was lost, stolen, or unintentionally damaged beyond repair.
For the first replacement charge before RUL (when allowed for the reasons above), modifier RA must be billed with the HCPCS code for the replaced base item, part, or accessory.
Replacement of a part or accessory in association with a covered repair before the expiration of the RUL may be allowed (bill with modifier RB) only when all of the following are true: the part/accessory is not an upgrade; replacement is necessary to make the base item functional; the part/accessory is not billed on the same date of service as the base item; the base item is not categorized as Frequently Serviced or Oxygen Equipment; a charge for the base item was not previously denied; the base item was previously purchased (including items that capped through rental payments); modifier RR is not billed; and Box 19 on the claim form (or electronic equivalent) includes the base item code and purchase date. When requirements are met, the replacement will be allowed at the purchase rate.
Modifiers, capped rental thresholds, and billing codes
Required transaction and purchase modifiersmixed
| RR | Rental modifier — submit for capped rental DME items, oxygen rental, TENS rental |
| NU | New equipment purchase modifier — submit to indicate new purchase (amount allowed is new equipment purchase rate) |
| UE | Used equipment purchase modifier — submit to indicate used purchase (amount allowed is the used equipment purchase rate, typically 75% of new) |
| QA/QB/QE/QF/QG/QR | Oxygen-related modifiers that adjust monthly rental rates based on prescribed oxygen and portable usage |
| MS | Maintenance and servicing modifier for applicable concentrators/refilling equipment |
Applicable modifiersHCPCS
| RR | Rental |
| RA | Replacement of a DME, orthotic or prosthetic item (first replacement before RUL when criteria met) |
| RB | Replacement of a part of DME, orthotic or prosthetic item furnished as part of a repair |
| NU | New equipment |
| UE | Used durable medical equipment |
| KH | Capped rental modifier — initial month supplied |
| KI | Capped rental modifier — second or third month supplied |
| KJ | Capped rental modifier — fourth or later month supplied (parenteral and enteral nutrition pump or capped rental months 4+) |
| MS | Six month maintenance and servicing fee for reasonable and necessary parts and labor not covered under warranty |
| QA | Oxygen modifier — prescribed stationary oxygen/usage adjustments |
1–10 of 15
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inv-05: Capped rental purchase point
Capped rental purchase pointA capped rental DME item is considered purchased after 13 continuous months of covered rental or when the total of all amounts allowed equals the applicable purchase amount.
Monthly rental limitsRental allowed for a period of continuous use not to exceed 13 months; Humana may allow purchase at any time regardless of modifier RR.
Rental rate basisMonthly rental rates are calculated as a percentage of the item's purchase rate in effect on the date of service billed (non‑power wheelchair: 10% first 3 months then 7.5% thereafter; power wheelchair: 15% first 3 months then 6% thereafter).
inv-06: TENS trial period
TENS chronic pain trialHumana requires a two‑month rental trial for TENS units used to treat chronic pain; suppliers must submit the two‑month trial charges with modifier RR.
Trial exclusion from 13‑month periodThe two‑month rental trial does not count toward the 13‑month capped rental period or toward the purchase amount calculation.
Post‑trial purchase determinationAfter the two‑month trial, the TENS unit is considered purchased in the month when the total of all amounts allowed reaches the applicable purchase amount or when rental exceeds the 13‑month period.
inv-07: IRP/DME purchase threshold
IRP/DME purchase thresholdAn IRP or other DME item is considered purchased in the month when the total of all amounts allowed equals the applicable purchase amount for that item.
Alternate purchase triggerAn item is also considered purchased if rental exceeds the maximum continuous rental period (13 months for capped rental items).
Humana discretion to allow purchaseHumana reserves the right to allow payment at the purchase rate at any time, regardless of submission of modifier RR; purchase rate follows new or used equipment rules and prior rental history when applicable.
Billing, authorization, and replacement actions for providers
Prior Authorization
Prior authorization/referral applicability
For a DME item that can be rented or purchased, whether that item is rented or purchased is subject to any applicable referral or prior authorization determination.
Billing Rule
Rental billing for TENS — submit RR
If a TENS unit is approved for on-going use and the charge is submitted with modifier RR, the amount allowed is the monthly rental rate. Humana reserves the right to allow the item at the purchase rate at any time regardless of submission of modifier RR.
- Submit rental charges for TENS units with modifier RR when billing monthly rental.
- Note: Humana may permit purchase instead of rental even when RR is billed.
Billing Rule
Purchase billing — submit NU or UE
When a TENS unit (or other DME purchased) is billed as a purchase, the supplier must submit the charge with the appropriate purchase modifier (NU for new, UE for used). The amount allowed will be the new or used equipment purchase rate; if the item was previously rented, the purchase rate is based on the purchase rate in effect at the time of the first month's rental.
- Use modifier NU to indicate new equipment purchase (allowed at new equipment purchase rate).
- Use modifier UE to indicate used equipment purchase (allowed at used equipment purchase rate; typically reduced to ~75% of new).
- If previously rented, purchase rate is the rate in effect at first month of rental.
Documentation Required
Replacement modifiers RA and RB — billing rules
Bill modifier RA on only the first replacement charge before the RUL when the item was lost, stolen, unintentionally damaged beyond repair, or the member's medical needs changed. Bill modifier RB with the HCPCS code for a replaced part or accessory when replacing a part in association with a covered repair and all RB criteria are met.
- RA: Required only for the first replacement charge prior to RUL for lost, stolen, unintentionally damaged items or changes in medical need.
- RB: Allowed for replacement parts during covered repairs when all criteria are satisfied (not an upgrade; necessary for function; not billed same date as base; base not Frequently Serviced or Oxygen; base charge not previously denied; base previously purchased; RR not billed; Box 19 includes base item code and purchase date).
- When RB criteria are met, replacement part is allowed at the purchase rate.
Definitions and modifier explanations
NU / UE purchase modifiers
NU (new equipment)Submit modifier NU to indicate a new equipment purchase; amount allowed is the new equipment purchase rate.
UE (used equipment)Submit modifier UE to indicate a used equipment purchase; amount allowed is the used equipment purchase rate, typically reimbursed at a reduced rate (commonly ~75% of new).
Effect on allowed amountThe purchase modifier reported (NU or UE) determines whether the new or used purchase rate is applied for the month billed.
Capped rental DME / Oxygen rental
Capped rental definitionCapped rental DME items are billed with modifier RR and reimbursed at monthly rental rates; rental is allowed for continuous use not to exceed 13 months, after which the item is considered purchased.
Oxygen rental special ruleOxygen equipment rental is allowed for continuous use not to exceed 36 months; modifier RR is required and monthly rates may be adjusted using QA/QB/QE/QF/QG/QR.
Monthly rental rates guidanceFor non-power wheelchairs: 10% of purchase rate for first 3 months, then 7.5% thereafter; for power wheelchairs: 15% for first 3 months, then 6% thereafter (based on purchase rate in effect for date of service billed).
TENS rental rules
Acute post‑operative TENS rentalHumana allows a one-month rental for TENS units used for acute post‑operative pain (submitted with RR).
Chronic pain TENS trialHumana requires a two-month rental trial for chronic pain; submit trial charges with modifier RR. The trial does not count toward the 13‑month rental or purchase amount.
Post-trial allowanceIf approved for ongoing use, subsequent rental submitted with RR is allowed at the monthly rental rate, or Humana may allow purchase at any time.
Transaction modifier
DefinitionTransaction modifier indicates whether the charge is for rental or purchase and, if purchase, whether it is new or used. Examples include NU, RR and UE.
UsageReport the transaction modifier (e.g., RR for rental) on charges so Humana can determine the amount allowed based on the billed transaction type.
Relation to purchase rulesHumana determines allowed amounts for TENS and other items based on the transaction modifier billed during rental or purchase periods.
Purchase modifier
DefinitionPurchase modifier indicates whether a purchase is new or used; the purchase modifiers described are NU (new) and UE (used).
Billing requirementWhen a DME item is purchased, the supplier must submit the charge with the appropriate purchase modifier (NU or UE).
Effect on reimbursementThe purchase modifier determines whether the new or used purchase rate is applied for the month billed; if previously rented, purchase rate is based on rate in effect at time of first month's rental.
Capped rental modifier
DefinitionCapped rental modifier indicates the rental month: KH for initial month, KI for months 2–3, and KJ for month 4 and later.
Usage with RRThese capped rental modifiers are used in conjunction with RR to indicate specific rental-month charges for capped rental DME items.
PurposeThey help identify the rental month for accurate application of monthly rental rates and purchase determinations after the capped rental period.
Policy Summary
PayerHumana
PolicyDurable Medical Equipment (DME) for Medicare Advantage
Policy CodePolicy CP2024013
Change TypeNo material changes
Effective DateOct 1, 2025
Next Review Date
Key ActionSubmit rental charges with modifier RR or purchase charges with NU/UE as appropriate and follow prior authorization/referral requirements when applicable.
SourceLink
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