Claim Denial – M9

Introduction

Following the rental-to-purchase rules in Durable Medical Equipment (DME) billing is essential for staying compliant, getting paid correctly, and building trust with patients. Medicare and commercial insurers enforce strict limits on how long equipment can be rented, requiring specific actions at each stage of the rental period.

DME rental programs are designed to strike a balance between fair provider compensation and the patient’s financial responsibility. As the rental period progresses, payers mandate that providers offer patients the option to purchase the equipment—rather than continuing indefinite rentals that may ultimately exceed the item’s value.

M-codes serve as markers within the billing process, indicating the rental month and the corresponding provider actions, including patient communication.

The M9 modifier identifies the tenth month of rental, a critical milestone when providers must formally present purchase options to the patient. Misapplying this modifier—or neglecting to complete the required patient notification—can result in denied claims, compliance violations, and significant revenue loss.

1. What is M9?

The M9 modifier indicates: “This is the tenth rental month. You must offer the patient the choice of changing the rental to a purchase agreement.”

In DME billing, M9 applies primarily to rental equipment such as:

  • Wheelchairs
  • Hospital beds
  • Oxygen concentrators
  • CPAP/BiPAP machines
  • Nebulizers
  • Infusion pumps

When a provider has billed for nine continuous months of rental for a piece of Durable Medical Equipment (DME), Medicare guidelines require that the patient should be informed about the option to buy the equipment instead of continuing with monthly rentals. The M9 modifier is used to show that this information has been shared with the patient as required.

2. Billing Challenges & Denials

DME providers face several common challenges related to M9 requirements:

Continued Rentals Without Purchase Option

Many providers accidently continue billing monthly rentals beyond the tenth month without properly offering the buying option to patients. This omission frequently results in claim denials.

Documentation Deficiencies

Even when providers orally inform patients about buying options, they often fail to document these conversations properly. During audits, the absence of proper documentation creates compliance vulnerabilities.

Automatic Claim Rejections

Medicare’s claim processing systems are designed to detect rentals that exceed the allowed period if the correct modifiers or status updates are missing. Such claims are promptly denied.

Compliance and Patient Relations Issues

Beyond claim denials, failing to follow M9 requirements can:

  • Trigger compliance violations and potential investigations
  • Create patient confusion and dissatisfaction when they learn they could have owned equipment
  • Result in revenue loss from denied claims

3. Solutions and Best Practices

DME providers can implement several approaches to address M9-related challenges:

Rental Period Tracking

Develop a standard approach to monitor rental time period for all equipment:

  • Create a focused field in your billing system to record the rental start date
  • Calculate and display the current rental month for each piece of equipment
  • Generate monthly reports identifying items approaching the tenth rental month

Automated Alerts

Set up your billing or practice management system to flag accounts requiring M9 attention:

  • Set up automatic notifications when equipment reaches the ninth rental month
  • Include reminder workflows for staff to initiate patient contact
  • Build verification checks before submitting claims for the tenth rental month

Patient Communication and Documentation

Establish a standardized process for informing patients of their purchase options:

  • Create a clear guide for staff explaining the rental-to-purchase choices to the patient
  • Design a standard template to record the choices explained to patients regarding equipment options.
  • Maintain signed acknowledgments of the patient’s decision in their records
  • For any oral discussions , have a follow up with written confirmation

Staff Training

Educate your billing team about M9 requirements:

  • Train staff to recognize equipment subject to rental caps
  • Conduct regular training sessions to review modifier usage and required documentation guidelines.
  • Review common denial patterns and correction procedures
  • Practice patient communication techniques for explaining purchase options

4. Real-World Example

XYZ Health Services experienced recurring claim denials for power wheelchair rentals. Upon analysis, they discovered they had continued billing monthly rentals through months 11 and 12 without properly documenting purchase offers after month 10.

The situation:

  • 37 patients had wheelchair rentals extending beyond month 10
  • Claims totaling approximately $42,000 faced denial
  • The company lacked documentation showing patients had received purchase options

Their solution: 

  1. Implemented a color-coded rental tracking system in their billing software
  2. Created a standardized “Month 10 Purchase Option” form
  3. Established a process requiring supervisory review of all claims approaching month 10
  4. Contacted affected patients to present purchase options retroactively

Results:

  • Claim denial rates for DME rental equipment decreased by 68%
  • The company successfully appealed 22 of the previously denied claims
  • Patient satisfaction scores improved with clearer communication
  • Staff reported greater confidence in handling rental equipment billing

5. Advanced Billing Considerations

Purchase Option Calculations

When presenting purchase options to patients at month 10, providers must calculate the purchase price according to payer guidelines:

  • Medicare typically applies 13 months of rental payments toward equipment purchase
  • The purchase price must account for rental payments already made
  • Patients need clear information about remaining financial responsibility

Documentation Requirements

Complete documentation for the tenth month of rental should include:

  • Date the purchase option was presented to the patient
  • Method of communication (phone, in-person, mail)
  • Names of staff members involved in the discussion
  • Patient’s decision (continue rental or purchase)
  • Any questions or concerns expressed by the patient
  • Follow-up communication plan

Modifier Combinations

M9 sometimes requires coordination with other modifiers:

  • KH (First month rental) – Never used with M9
  • KI (Second or third month rental) – Never used with M9
  • KJ (Months four through ten) – Often precedes M9 usage
  • NU (New equipment purchase) – May follow M9 if patient chooses to purchase
  • RR (Rental equipment) – Used with M9 to indicate rental status

6. Regulatory Framework

The Centers for Medicare & Medicaid Services (CMS) established the “capped rental” category for certain DME items under 42 CFR §414.229. This regulation specifies:

  • Monthly rental payments apply for continuous use items
  • Rental payments cannot exceed 13 months
  • After 10 continuous rental months, suppliers must offer patients the option to purchase
  • The supplier must provide clear written and verbal instructions about purchase options

Other payers frequently adopt similar policies, making proper M9 usage relevant beyond Medicare claims.

7. Technology Solutions

DME providers can leverage technology to improve M9 compliance:

  • Electronic health record (EHR) customization to flag rental duration
  • Patient portal communications to document purchase offers
  • Digital signature collection for purchase option acknowledgments
  • Billing system edits that prevent claim submission without M9 verification
  • Analytics tools to identify patterns of M9-related denials

Conclusion

The M9 modifier represents more than a billing code—it signifies an important transition point in the DME rental process. When DME providers accurately monitor rental periods, clearly explain purchase options to patients, and keep detailed records, they are better positioned to:

  • Reduce claim denials and reimbursement delays
  • Meet regulatory requirements and avoid compliance issues
  • Build patient trust through transparent communication
  • Optimize revenue cycle performance

Effective M9 management requires attention to detail, systematic tracking, and a patient-centered approach. When properly integrated into billing workflows, these practices support both financial health and quality patient care.

Starting a clinic does not have to be difficult

Schedule a 1:1 with a startup specialist to see how we can help you