RARC M124: Missing Equipment Ownership Declaration for Part or Supply
The claim is missing the required declaration of whether the patient owns the equipment that the billed part or supply is intended for — add the ownership indicator and resubmit.
What Does RARC M124 Mean?
M124 is specific to claims for replacement parts, repairs, or supplies associated with durable medical equipment (DME). When a supplier bills for a component or supply that attaches to or services a piece of equipment, the payer needs to know whether the patient owns the base equipment or is still renting it. This distinction affects coverage rules and payment amounts — for example, Medicare covers replacement parts for patient-owned equipment under a different benefit category than rental equipment accessories, and the supplier's billing obligations differ depending on the ownership status.
The ownership declaration is typically reported through specific modifiers or information fields on the claim. When this indicator is absent, the payer cannot determine the correct payment pathway and will hold or deny the claim with M124. This remark is most commonly seen in Medicare DME claims processed through the DME Medicare Administrative Contractors (MACs), though commercial payers that follow similar DME billing conventions may also use it.
M124 often appears alongside CARC 16 (missing information) or CARC 252 (additional information required). In most cases, the fix is straightforward once you confirm the equipment's ownership status — the key is having accurate records of when the patient's rental period ended and ownership transferred.
What to Do
Check your records to determine whether the patient owns the base equipment or is still in a rental period. If the patient owns the equipment (typically after the 13th month of continuous rental for capped rental items under Medicare), add the appropriate ownership modifier or indicator to the claim. If the equipment is still being rented, the parts or supplies may need to be billed differently or may be included in the rental payment. Resubmit the claim with the correct ownership information.
For DME suppliers billing parts and supplies regularly, building an equipment ownership tracking system that flags when patients transition from rental to purchase status can prevent M124 across your entire claims portfolio. Many billing platforms allow you to set ownership status at the patient-equipment level so that downstream claims for parts and supplies automatically inherit the correct indicator.
Common Scenarios
- A DME supplier bills Medicare for a replacement CPAP mask cushion but does not indicate that the patient has owned the CPAP machine since the rental period ended eight months ago — the claim is returned with M124.
- A wheelchair repair claim is submitted without the ownership modifier because the billing system still shows the chair as a rental item, even though the patient crossed the purchase threshold two months prior.
- A supplier bills for oxygen equipment supplies but cannot determine from their records whether the concentrator is patient-owned or under a rental agreement with another supplier, and submits the claim without the ownership declaration.
Commonly Paired With
RARC M124 commonly appears alongside these CARC denial codes:
| Code | Name | |
|---|---|---|
| CO-16 | Missing Information or Billing Error | → |