A. Purchase items are equipment that is purchased for or purchased by an eligible Medicaid beneficiary. The equipment may be new or used.

B. Rental-only items are those items paid by Arkansas Medicaid to providers for an unspecified time period on an as-needed basis. The equipment may be new or used.

C. A capped rental item is equipment whose purchase price exceeds $150.00. The items may be new or used. The items are reimbursed utilizing a daily rental rate. Medicaid pays the daily rental rate not to exceed a fifteen- (15-) month rental maximum (455 days). A period of continuous use allows for periods of interruption up to 60 consecutive days. If the interruption is 60 or fewer consecutive days, a new 15-month rental period will not begin. If the interruption is more than 60 days, a new 15-month rental period will begin.

D. After the total cost of a capped rental item has been reimbursed by Medicaid, the item remains the property of the DME provider. For items that have reached a 15-month rental cap, claims will be paid for maintenance and servicing fees after six months have passed from the end of the final paid rental month or from the end of the period the item is no longer covered under the supplier's or manufacturer's warranty, whichever is later.

E. Providers may be reimbursed for capped rental and rental-only items if the equipment is used fewer than 30 consecutive days from the first day of rental. This ensure the provider of adequate reimbursement for equipment used fewer than 30 days.

F. A rent-to-purchase item is an item for which Arkansas Medicaid reimburses a provider for the Medicaid-established purchase price of the item. After reimbursement has reached the maximum allowed, the equipment will become the property of the Medicaid beneficiary. Reimbursement is only approved for new equipment.

G. Initial rental transactions are those for which equipment is used in a beneficiary's home for fewer than 30 consecutive days. Initial rental transactions must not be used by the provider to bill a month in advance. Arkansas Medicaid will only pay after services are rendered. An example of an initial rental transaction is that of a hospital bed delivered on July 2 and removed from the home after 10 days.

H. Manually priced items are those for which Arkansas Medicaid pays the manufacturer's invoice price plus 10 percent. The provider must attach the invoice with their claim for services rendered.

I. A used item is any item that has been rented for 90 days or longer by anyone prior to the current Medicaid “rental only” or “capped rental” transaction. The provider must maintain documentation that certifies a used item is reconditioned and in good working order and has no defect in workmanship or material.

J. Repair of a “rental only” item is covered in the rental fee. Repair of “purchased” items is covered separately. Total (cumulative) repair costs must not exceed 50% of the item's total purchase cost.