Prior Authorization (DME)
Advance approval from Medicare or a payer required before a supplier can deliver certain high-cost or frequently abused DME items.
Prior authorization (PA) requires a DME supplier to submit clinical documentation and receive explicit approval from the payer before delivering covered items. CMS has expanded PA requirements significantly over the past decade, particularly for power wheelchairs, Group 3 support surfaces, and certain respiratory items, in response to historically high rates of inappropriate billing.
The PA process requires assembling a documentation package: a physician order, face-to-face examination notes, clinical records supporting medical necessity, and a detailed product description (DPD) matching the exact item being billed. Incomplete documentation is the leading cause of PA denial.
Once PA is granted, the supplier must deliver the specific item covered — not a different model or serial number. This creates a link between the PA approval, the billing record, and the specific unit's serial number that must be maintained in the supplier's records.
Tracking which PA-approved units have been delivered against which authorization — and ensuring the right serial number is on the claim — is part of the billing accuracy workflow that connects directly to inventory management.