Skip to main content

M7 Remark Code: No Rental After Purchase or Payoff

M7 means the payer will not make more rental payments for this equipment because the item was purchased, was returned, or the rental payments already made add up to the purchase price.

Quick facts

Code
M7 (RARC M7)
Status
Active In use since January 1, 1997; last modified November 1, 2016.
Code set
Remittance Advice Remark Codes (RARC)
Group codes
  • CO (Contractual Obligation): Rental months billed after the cutoff are a supplier write-off.
  • PR (Patient Responsibility): Rarely, the patient may be responsible if they chose to keep renting beyond coverage under a valid advance notice.
Official description
No rental payments after the item is purchased, returned or after the total of issued rental payments equals the purchase price.
X12 Remittance Advice Remark Codes, retrieved September 25, 2026
Last verified
against the official X12 list.

What M7 means

M7 is a durable medical equipment remark that closes the door on further rental payments. The official text lists three triggers: the item was purchased, it was returned, or the cumulative rental payments have reached the item’s purchase price. Any one of those means additional rental claims will be adjusted to zero.

It is common on Medicare DME claims, and some commercial payers apply the same rent-to-purchase logic.

Common causes

  • The supplier kept billing monthly rental after a purchase claim was paid.
  • The item was returned, but the rental schedule in the billing system was not stopped.
  • The sum of paid rentals hit the purchase price earlier than expected because another supplier billed part of the rental.
  • A new rental was billed for the same item without evidence of a new medical need.

What to do

  1. Pull the full payment history for the item across all suppliers you can see.
  2. Confirm the status of the item: purchased, returned, or still in rental.
  3. If the payer’s history is wrong (for example, a return date is recorded incorrectly), send the proof and request reprocessing.
  4. If the patient has a new, separate need, gather the new order and documentation and follow the payer’s process for starting a new rental.
  5. Otherwise, write off the extra months and stop the recurring claim.

How to prevent it

Build an automatic stop in your billing system when an item is purchased, returned, or reaches its rental cap. Reconcile rental totals against the purchase price each month. For more on avoiding repeat billing, see duplicate claim denials.

Codes that may appear with M7

  • PR-119 (Benefit maximum for this time period or occurrence has been reached.): The rental benefit maximum equal to the purchase price has been reached.
  • OA-18 (Exact duplicate claim/service (Use only with Group Code OA except where state workers' compensation regulations requires CO)): The rental month duplicates a purchase already paid.
  • CO-96 (Non-covered charge(s).): Further rental is non-covered after purchase or return.
  • M5 (Monthly rental payments can continue until the earlier of the 15th month from the first rental month, or the month when the equipment is no longer…): A time-based rental limit, while M7 is triggered by purchase, return, or payoff.
  • M10 (Equipment purchases are limited to the first or the tenth month of medical necessity.): Limits when an equipment purchase can occur.
  • N370 (Billing exceeds the rental months covered/approved by the payer.): Billing exceeds the number of rental months the payer covers or approved.

M7 FAQ

What if the patient returned the item and later needs it again?

A new need may justify a new rental, but the payer will usually want documentation of the gap and the new medical need before paying.

How do I know the total rental paid?

Add the allowed rental amounts across your remittances for the item and compare to the payer's purchase price for that item and period.

Does M7 apply to supplies used with the equipment?

M7 is about rental payments for the equipment itself. Supplies and accessories follow their own rules.