Big Sky Waiver Specialized Medical Equipment and Supplies (Service Limitations)
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Defines coverage, prior authorization, provider and equipment requirements, allowable and excluded specialized medical equipment and supplies under the Big Sky Waiver program and rules Case Managers must follow when requesting payment or authorization.
No material clinical or coverage changes in this revision.
Coverage Criteria and Limits
General coverage conditions
Covered when ALL of the following are met
Repair/maintenance/replacement coverage
Repair and replacement covered when ALL of the following are met
Excluded items are those that do not meet the Big Sky Waiver definition of specialized medical equipment and are not necessary for the member to remain in the home or community. Examples include items used only for leisure, recreation, education, or vocational purposes when not required for assistive technology; clothing; basic household furniture for non-medical purposes; and non-medical supplies such as cleaning products and routine personal care items. Educational items (computers, software, books) are excluded unless purchased in conjunction with and required for assistive technology. Also excluded are consumer electronics (televisions, stereos, radios, DVDs), and services such as cable, Internet service, or cell phone plans. Groceries are not covered except for specialized nutritional products or supplements required to maintain nutrition.
Specialized medical equipment and supplies must be received after the client's enrollment in the Big Sky Waiver and prior to termination. Payment will not be made for services rendered after the effective date of termination. Services incurred before the prior authorization request will not be approved and are subject to repayment. The Department may authorize exceptions only with prior Department authorization and documentation in the member's case record.
Services that are expected to be consumed after a member's Big Sky Waiver termination (for example, bulk dietary supplements anticipated to be used after termination) do not meet Big Sky Waiver service or prior authorization criteria and are not payable.
Coding, Thresholds, and Denial Codes
| HCPC code(s) | Required in formal denial documentation (specific codes to be listed by provider/denying payer) |
Prior Authorization and Case Manager Responsibilities
Prior authorization required from Regional Program Officer
All Specialized Medical Equipment and supplies must be prior authorized by the Regional Program Officer (RPO). Services incurred before prior authorization or after Big Sky Waiver termination will not be paid and are subject to repayment. Items exceeding the documented cost threshold require RPO prior authorization and, when applicable, accompanying bids.
- Services must be received after enrollment and prior to termination to be payable.
- A prior authorization cannot be given to the provider before the member receives the service.
Retain warranties/certifications in case record
(Unnamed provider action) Ensure copies of warranties or rental agreements and certification for used/refurbished equipment are retained in the member’s case record; used/refurbished equipment must be certified safe and performing within manufacturer specifications and include operational verification and any required software/training aids.
- Keep copies of warranties or rental agreements in the case record.
- Used/refurbished equipment must be certified and include operational verification and necessary software/training aids.
Document third‑party payer evaluation and exhaustion
Case Managers must evaluate and document exhaustion of all potential third‑party payer sources before authorization. Documentation that items are not coverable by other payers must be present in the member’s case record.
- Third‑party sources include Medicare, Medicaid State Plan (including EPSDT), Community First Choice (CFC), natural supports, and private insurance.
- Documentation of evaluation and exhaustion of these sources must be maintained in the case record prior to authorization.
Submit two detailed bids for items over $5,000
Prior authorization requests for Specialized Medical Equipment and Supplies with total cost exceeding $5,000 must include at least two written estimates/bids. Each bid must itemize materials, labor (hours and hourly rate), and other miscellaneous costs; if two bids cannot be obtained, document efforts made to secure multiple bids.
- Provider costs for preparing bids are not payable by Big Sky Waiver.
- The lowest bid is generally accepted; a member may choose a bid within 10% of the lowest at their choice.
- Situations with only one bid require RPO review and approval.
Obtain formal denial documentation when item is non‑coverable
To establish a formal denial for items not covered by Medicare or Medicaid State Plan, obtain either: (a) formal documentation from Medicare or the Medicaid State Plan that the item is non‑coverable; or (b) written documentation from the DME provider that includes the reason for denial, the HCPC code(s), and the Local Coverage Determination reference. Note that vendor refusal to bill Medicare/Medicaid is not an allowable denial.
- Denial documentation must include: reason for denial; HCPC code(s); Local Coverage Determination reference.
- Vendor refusal to bill or accept Medicare/Medicaid reimbursements does not constitute an allowable formal denial.
Key Definitions
Medical Necessity Criteria
Necessity criteria
Rental vs Purchase Rules
| Item | Rule |
|---|---|
| Specialized Medical Equipment | |
| May be rented or purchased. Equipment may be rented if not covered by Medicare, Medicaid State Plan, or another third party; case managers must choose rental or purchase based on the member's functional need, circumstances, and the most cost‑effective option for the anticipated period of need. Default is a one‑time purchase or rental except for non‑durable supplies. |
Replacement and Repair Rules
Recordkeeping and Certification
Retain warranties/rental agreements; certify used/refurbished equipment
Keep copies of warranties or rental agreements in the member's case record; used or refurbished equipment must be certified by a DME provider as safe and performing within manufacturer specifications and include operational verification, necessary software, and training aids as applicable.
- Copies of warranties or rental agreements should be retained in the case record.
- Used/refurbished equipment must be certified safe, meet manufacturer specifications, include operational verification, necessary software, and training aids, and a hold‑harmless agreement is recommended.
Background
Specialized Medical Equipment under the Big Sky Waiver must provide a direct medical or remedial benefit, be an approved Big Sky Waiver service, and be expected to prevent institutionalization by promoting independence with activities of daily living (ADLs) and instrumental ADLs (IADLs). Equipment must support health and safety in the home and community, be expected to improve functional abilities, align with existing equipment, and be cost-effective relative to the member's needs. Case Managers must reference the Big Sky Waiver table of commonly approved items (BSW 733-2) and pursue all potential third-party payers (including Medicare, Medicaid State Plan/EPSDT, Community First Choice, and natural supports) before requesting Waiver payment.
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