Starting a durable medical equipment (DME) business is an exciting venture in healthcare, but before you can serve patients, you’ll likely need to obtain a DME license.
A DME license is essentially a permit from your state (and sometimes local or federal agencies) allowing your business to sell or rent durable medical equipment like wheelchairs, oxygen tanks, or hospital beds to patients.
In this guide, we’ll break down:
- what a DME license is;
- which states require a DME license;
- how to get a DME license step by step;
- DME license requirements by state;
- typical DME license costs;
- how long the process takes..
What Is a DME License (and Do You Need One)?
A DME license is a legal authorization for businesses to sell or distribute durable medical equipment within a particular jurisdiction. Think of it as your business’s permission slip to provide medical equipment.
Most states in the USA require a DME license (or a related healthcare business license) if you plan to supply DME to patients. This license ensures that your company meets certain standards for safety, record-keeping, and accountability before you start delivering products like walkers, CPAP machines, or infusion pumps.
Why do states require a DME license? It comes down to protecting patients and maintaining quality. DME items are critical healthcare products that often require proper handling, installation, and maintenance. By mandating licenses, states can enforce guidelines – for example, requiring businesses to have appropriate insurance, to use trained staff, or to pass facility inspections.
Essentially, a DME license shows you’re a legitimate, compliant provider in this highly regulated industry. It’s not just red tape; it’s about ensuring patient safety and trust.
DME License Requirements by State
One of the trickiest parts of getting your DME license is figuring out the requirements in your particular state. There is no single national DME license; instead, you’ll deal with state authorities.
| State | License Needed? | Regulatory Authority | Important Details |
| Florida | ✔️ Required | Agency for Health Care Administration (AHCA) | Requires a Florida-based agent, facility inspection, and surety bond. |
| Texas | ✔️ Required | Texas Department of State Health Services (DSHS) | Out-of-state suppliers must submit the specialized DME provider application. |
| California | ✔️ Required | California Board of Pharmacy | Licensing applies to all remote, out-of-state, and telehealth-affiliated suppliers. |
| Illinois | ✔️ Required | Illinois Department of Financial & Professional Regulation | Accreditation plus a state bond is typically needed for approval. |
| New York | ❌ License Not Required | — | Although a DME license isn’t mandatory, providers must obtain an NPI and enroll with NY Medicaid for reimbursement. |
| Georgia | ✔️ Required | Georgia Board of Pharmacy | Certain DME categories may require involvement from a licensed pharmacist. |
| Nevada | ❌ License Not Required | — | National or federal-level accreditation generally meets Nevada’s requirements. |
| Arizona | ❌ License Not Required | — | Suppliers must limit services to DMEPOS-related offerings to remain compliant. |
| North Carolina | ✔️ Required | North Carolina Board of Pharmacy | Telehealth or remote service providers must apply for appropriate state registration. |
| Pennsylvania | ✔️ Required | Pennsylvania Department of Health | Some equipment types may require an in-state location or representative. |
Here are some key points to consider:
Many states require a license
The majority of U.S. states have laws that require DME suppliers to be licensed in order to do business there. This applies whether you’re physically located in the state or even if you’re out-of-state but intend to ship or deliver equipment to patients in that state.
- For example, North Dakota law says even an out-of-state company must obtain a North Dakota DME retailer license before selling to ND residents.
- Similarly, Florida mandates a Home Medical Equipment Provider license for anyone supplying DME to patients in Florida.
- Texas also requires DME businesses to be licensed through the Texas Department of State Health Services (DSHS) before operating there.
A few states have no specific DME license
There are a handful of states that don’t have a stand-alone DME licensing requirement.
For instance, Nebraska doesn’t require a special DME supplier license or registration. If you’re expanding your business into Nebraska, you wouldn’t need a Nebraska-issued DME license to serve patients there.
However, you would still need to follow any general business registration laws and federal requirements (more on those later).
💡Note: Always double-check, because “no specific DME license” doesn’t mean “no rules at all” – you might still need to, say, register for taxes or comply with pharmacy laws if you provide certain devices.
Different agencies oversee licensing in different states
Part of the confusion is that DME licenses aren’t handled by a single type of agency everywhere. In some states, the Department of Health or a specific Health Care Administration office handles DME provider licensing (e.g., Florida’s Agency for Health Care Administration).
In others, the Board of Pharmacy might be the regulator, especially if the state treats DME similar to medical device distribution (California often uses its Board of Pharmacy for out-of-state medical device retailers).
There are also states like Kentucky, which even has a separate Board of Durable Medical Equipment Suppliers that issues licenses.
💡Note: The name of the license can also vary – it might be called a “Home Medical Equipment license,” “Medical Device Retailer license,” “DME supplier permit,” etc., but the purpose is similar.
Scope of what requires licensing can differ
States vary in terms of what products or services trigger the licensing requirement. Some states license all DME suppliers, period. Others might only require a license if you’re providing certain types of equipment (for example, oxygen equipment often requires special permits like pharmacy or respiratory care licenses because oxygen is considered a prescription item).
A few states provide exemptions if you’re already a licensed pharmacy or medical facility – meaning if your pharmacy adds DME on the side, you might not need a separate DME license in that state.
💡Note: Always read the fine print: the licensing rules can depend on whether the equipment needs a prescription, whether you’re selling to consumers vs. hospitals, and even on how the products are delivered.
Steps to Get a DME License (How to Apply)
Now let’s dive into how to get a DME license for your business. While the exact process will depend on your state, the overall journey has a lot of common elements everywhere.
1. Set up your business entity
Make sure your DME business is properly formed as a legal entity (e.g., an LLC, corporation, partnership, etc.) and registered in your home state. You’ll need official business documents like Articles of Incorporation or Organization. These corporate documents will be required in your DME license application.
If you plan to operate in other states, you might also need to foreign qualify your company in those states (essentially register as an out-of-state business) before applying for their licenses.
2. Obtain your National Provider Identifier (NPI)
An NPI is a unique 10-digit ID for health care providers. If you intend to bill Medicare or other insurance for DME, you must have an NPI. Getting an NPI is done through a federal system (NPPES) and is usually free – but it’s an important step before you can get insurance reimbursements. .
3. Get accredited by a CMS-approved body (if applicable)
If you want to bill Medicare or many insurance companies, your DME business will need to be accredited by an approved accreditation organization (e.g., ACHC, JCAHO, BOC, NABP, etc.). Accreditation isn’t the same as a state license, but it’s often a parallel requirement.
In fact, some states ask for proof of accreditation or a passed inspection as part of the license application. The accreditation process involves meeting quality standards and usually an on-site survey. It can take a few months to complete, so it’s wise to start it early.
4. Gather required documents and prerequisites
Before filling out the DME license application, get all your paperwork in order. Common DME license application requirements include:
- proof of general liability insurance (and sometimes product liability insurance);
- a sales tax permit or resale certificate (since some states require DME providers to register for sales tax even if the products might be tax-exempt);
- information on company officers/owners.
Many states also require background checks or fingerprints for the owners and key personnel.
5. Complete the DME license application form
Obtain the official application form from your state’s regulatory agency. This could be an online application or a PDF form that you mail in. Fill it out carefully and honestly.
You’ll typically need to provide details like your business name, address (physical location of your operation), responsible persons, and the types of equipment you’ll offer.
Double-check if you need to designate a licensed pharmacist or respiratory therapist as a consultant – a few states require an affiliation with a medical professional if you’re dealing with certain equipment (like oxygen). Attach all those documents you gathered in step 4 to your application.
6. Pay the licensing fee
Every state charges a fee to process a DME license application (because of course they do!). The DME license cost varies by state. Some examples: Florida’s initial license fee is about $304.50, plus $400 for an inspection fee.
In Texas, fees for a device distributor license can range from $495 for small businesses (under $500k revenue) up to a couple thousand dollars for larger companies.
Other states might have fees in the $300–$600 range as well. Plan for a few hundred dollars at least.
Make sure to submit the payment in the format the agency accepts (some want a check or money order; many nowadays accept online payments or credit cards). Keep the receipt or proof of payment, just in case.
7. Prepare for an inspection (if required)
A number of states will conduct an on-site inspection of your facility either before granting the license or shortly after.
For instance, Florida’s AHCA sends inspectors to check your location (and they charge that $400 fee for it).
Inspectors might verify that you have a clean and secure storage area for equipment, proper record-keeping, and perhaps that you have policy manuals in place. Not all states do an inspection, but be ready if yours does. It helps to have your store or warehouse organized and your files (like patient service agreements, maintenance logs, etc.) in order. The inspection is often a simple checklist as long as you’ve done your homework.
8. Submit your application and wait for approval
Once everything is filled out, reviewed, and compiled, send in that application! If it’s online, you’ll hit submit and likely get a confirmation. If by mail, consider using a trackable mailing method so you know it arrived.
After submission, the processing time can vary. On average, you might expect anywhere from about 4 to 8 weeks to get your DME license approved.
9. Address any follow-up requests
It’s not uncommon for the state agency to reach out for additional information or corrections after reviewing your application. Don’t panic – this might be as simple as, “Please clarify an address” or “We noticed you forgot to include a copy of X document.”
Respond promptly to any such inquiries to keep your application moving. Once everything is satisfactory and any inspection is passed, the agency will issue your DME license certificate!
10. Display and use your license appropriately
When you receive your license, congratulations! Make sure you display it at your place of business if required (many states require the physical license to be posted where customers can see it).
Also, note down the license number and expiration date, because you’ll need to renew it periodically. Having a DME license also means you must adhere to the state’s regulations for operating – for example, some states might require certain records to be kept for X years, or mandate reporting changes like address or ownership to the agency.
DME License Cost and Fees
One big question for new business owners is “How much does a DME license cost?” The answer: it depends on the state (and sometimes on your business size). Here’s a rundown of cost factors to keep in mind:
- State license fees: Each state sets its own pricing for the license application and renewal. Many states charge a flat fee in the few-hundred-dollar range.
- Other state costs: Some states may require a surety bond or other financial security as part of licensing. Medicare requires all DME suppliers to have a $50,000 surety bond on file anyway, so most DME businesses must obtain that.
- Accreditation costs: While not a state “license fee,” don’t forget accreditation expenses in your startup budget. Accrediting bodies charge for the survey process – often in the range of $2,500 to $5,000 for initial accreditation for a single location (varies by accreditor and size of business).
- Renewal fees: A DME license isn’t a one-and-done cost. You will have renewal fees periodically (usually every 1 or 2 years, depending on the state). Renewal fees are often similar to the initial fee (sometimes slightly lower, sometimes the same).
- Incidental costs: Don’t forget things like the cost of fingerprinting/background checks (some states require you to pay a fee to a fingerprint processing vendor or include a processing fee with the application). This could be, say, $50-$100 per person being screened.
How Long Does It Take to Get a DME License?
You’re probably eager to open your doors (or your e-commerce site) and start serving customers. So, how long does it take to get a DME license? The timeline can vary, but here are some general expectations:
- Typical processing time. On average, once you submit a complete application, you might wait around 4 to 8 weeks for approval.
- Factors that can extend the timeline. If your state requires an inspection before approval, the timing of that inspection is key. Scheduling an inspector’s visit could add a couple of weeks. Also, if the state board or committee only meets periodically to approve licenses, you might be waiting for the next meeting.
- Real-world variations. In some states, people report getting their license in just a couple of weeks if everything was straightforward. In others, it has taken three months plus.
- Federal paperwork timing. Remember, beyond the state license, if you’re aiming to bill Medicare, you also have to enroll via Medicare’s National Supplier Clearinghouse (using form CMS-855S or PECOS online).
So, if we look at the big picture of launching a DME business from scratch – obtaining all credentials – it could take 2 to 5 months in total before you’re fully ready to bill patients and insurers.
Conclusion and Next Steps
The key takeaways are:
- always check your specific state’s requirements,
- stay organized with your documentation,
- and don’t be afraid to seek guidance from official sources or experts.
Once you have that license in hand, you’ll be ready to serve patients confidently, knowing you’re operating within the law and upholding important safety standards.
Finally, as you move forward, remember that running a DME business involves more than just the license – you’ll be managing inventory, billing insurance, coordinating deliveries, and providing customer service.
This is where having the right tools can make a huge difference. NikoHealth is one such tool that can help take your newly licensed DME business to the next level.
NikoHealth is a cloud-based HME/DME software platform that streamlines your business workflow by automating processes and improving your bottom line. It’s designed to handle everything from patient orders and insurance claims to inventory tracking and delivery scheduling, all in one user-friendly system.
To learn more, request a demo and explore the full capabilities of NikoHealth DME business process automation platform.
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