Vendors that bill Medicare for durable medical equipment (DME) are unexpectedly losing those DME billing privileges after failed surprise site visits - most often because an inspector shows up during the location’s posted hours, finds no employee available, or does not look around for a vendor’s employees, and records the facility as inaccessible. The problem stems from a supplier standard rule that treats posted hours as binding; however, CMS allows pharmacies to enroll their DME line as “By Appointment Only,” removing the expectation of walk‑in availability and eliminating this revocation trigger altogether.

The Hidden Risk in DME Compliance for DME Vendors

Vendors that dispense walkers, diabetic supplies, wound care dressings, or other durable medical equipment under a supplier number must satisfy all twenty‑nine supplier standards in 42 C.F.R. § 424.57(c).

CMS contractors conduct unannounced inspections to verify those standards, and if a location is “closed or inaccessible” during its posted hours - even though the front counter may be open for prescriptions - NSC (now the National Provider Enrollment DMEPOS East/West contractors) can revoke billing privileges on the spot.

Revocation stops Medicare payments immediately and can carry a ten‑year reenrollment bar, hitting revenue far harder than most drug‑store audit findings.

Understanding the Trigger – The “Posted Hours” Compliance Trap

Supplier standards require a DME supplier to maintain “accessible posted hours of operation.”

Inspectors schedule their visits with no warning; they simply arrive during those posted hours. If no DME supplier staff are present, the visit is documented as “failed,” leading to a revocation letter that cites inaccessibility.

Only mobile units and suppliers designated “By Appointment Only” are exempt from unscheduled inspections.

The Proactive Solution – Enroll as “By Appointment Only”

The CMS‑855S enrollment form expressly lets a supplier check “By Appointment Only” (that is, with no fixed days or hours where the facility is open and available to customers or inspectors, but only if the supplier meets the exception in 42 C.F.R. § 424.57(c)(30).

Under § 424.57(c)(30), a Medicare DME supplier may register as a “By Appointment Only” facility only where they are either:

(a) a Physician who furnishes items to his or her own patients; (B) A physical or occupational therapist who furnishes items to his or her own patients; or (C) DME supplier working with custom made orthotics and prosthetics.

Once granted status as a “By Appointment Only” supplier, site visits must be pre‑arranged by the Medicare contractor site inspectors, and inspectors cannot mark the supplier as “inaccessible” or “non-operational.”

We further recommend adding clear signage in prominent locations, including the front door to your facility, with a phone number and email address, so inspectors can contact your business to schedule a visit. This will prevent any confusion as to whether you are a “By Appointment Only” facility entitled to scheduled site visits.

Implementing the Designation

• Update your Durable Medical Equipment, Prosthetics, Orthotics, and Supplies (DMEPOS) application form with CMS (CMS‑855S, Section 2) to check “By Appointment Only.”
• Ensure signage and voicemail direct regulators to a dedicated compliance contact to set inspection times.
• Retain confirmation of CMS approval in the compliance binder and train front‑line staff to refer any walk‑in inspector to the posted appointment process.

Building a Resilient, Audit‑Proof Operation

Adopting the “By Appointment Only” status is not a loophole; it is a CMS‑recognized alignment of operations with supplier standard expectations, turning a potential vulnerability for small and medium-sized DMEPOS suppliers into a low-risk scheduled inspection.

DME suppliers should review their current DME enrollment, posted hours, and signage immediately, and evaluate whether they qualify as a “By Appointment Only” supplier, to protect vital Medicare revenue.

Health Law Alliance can guide you through the CMS‑855S update, communicate with enrollment contractors on your behalf, and defend any ongoing revocation actions, ensuring your DME business remains secure. Please contact Health Law Alliance today for a free consultation on how your DME business can protect itself or fight back against a wrongful enrollment termination or billing privilege revocation.

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