To operate a durable medical equipment business in California, you need a Home Medical Device Retailer (HMDR) license issued by the California Department of Public Health’s Food and Drug Branch before you sell, rent, or deliver a single item for home use.1California Department of Public Health. Home Medical Device Retailer License Application The California DME license requirements cover your business structure, your facility, background checks on owners and key staff, written policies, a state inspection, and annual renewal. If you also plan to bill Medicare or Medi-Cal, a separate layer of federal accreditation, bonding, insurance, and program enrollment sits on top of the state license.
Who Needs an HMDR License
The license applies to any facility that sells, delivers, or rents durable medical equipment to patients for home use, including hospital beds, wheelchairs, oxygen equipment, and other mobility or respiratory aids. The license is renewed every year and cannot be transferred to another owner or location.2California Legislative Information. California Health and Safety Code HSC 111656
If your inventory includes prescription medical devices such as certain oxygen systems, ostomy supplies, or urinary catheters, a pharmacist-in-charge or a licensed Home Medical Device Retailer Exemptee must be on the premises whenever those devices are being dispensed or fitted.1California Department of Public Health. Home Medical Device Retailer License Application Dispensing without that supervision is a separate violation under California law.3Justia Law. California Health and Safety Code Article 6 – Licenses
One boundary worth knowing: out-of-state businesses that ship medical devices into California don’t need the full HMDR license, but they do have to register with the CDPH as an out-of-state facility.4California Department of Public Health. Home Medical Device Retail Program
Set Up the Business and Facility First
Before the application makes sense, the business and the location need to exist on paper and in the real world. Form your entity (corporation, LLC, or otherwise), obtain a Federal Employer Identification Number, pull any local business permits, and confirm the site is zoned for commercial use.
Your facility must have a business address accessible to the general public.5Legal Information Institute. California Code of Regulations Title 22 51224.5 – Durable Medical Equipment and Medical Supply Providers You need dedicated commercial space to store inventory and conduct business, with sanitation controls and secure methods for protecting equipment and patient records.
If Medicare billing is part of your plan, federal supplier standards add facility rules the state doesn’t impose: a minimum of 200 square feet, posted hours and visible signage, a landline business phone rather than a cell phone, and the facility open to the public at least 30 hours per week.6eCFR. 42 CFR 424.57 – DMEPOS Supplier Standards Build those into your lease decision rather than discovering them after you’ve signed.
Completing the HMDR Application
The form is CDPH 8679, the Home Medical Device Retailer License Application.1California Department of Public Health. Home Medical Device Retailer License Application You disclose ownership in full, listing every owner and officer by name and title, and you show that the business is financially solvent enough to operate responsibly. Proof of the physical facility goes in too, typically the lease and local permits.
Every owner and key employee has to clear a background check through California’s Live Scan fingerprinting system. A certified roller captures the prints electronically and submits them to both the California Department of Justice and the FBI for criminal history review.7State of California – Department of Justice – Office of the Attorney General. Fingerprint Background Checks Use the Live Scan request form with the HMDR program codes, not a generic form from another agency.
Written policies and procedures travel with the application. State law dictates what they cover: staff and patient training, equipment cleaning and maintenance, emergency service for device malfunctions that could threaten patient health, record-keeping, storage and security of prescription devices, and an ongoing quality assurance program.8California Legislative Information. California Health and Safety Code HSC 111656.3 Employee training and competence records have to be kept for at least three years after the person’s last day of employment.
Review, Inspection, and Reporting Changes
The Food and Drug Branch reviews the package for completeness once it arrives with your fees. Missing items generate a deficiency notice that you have to answer promptly. Depending on the complexity of the application and current submission volumes, the paper review can run several months.
A mandatory on-site inspection follows. Inspectors confirm that inventory is stored securely, required records are maintained and accessible, and the pharmacist or exemptee is present when the law requires one. Shortfalls trigger corrective action and a follow-up visit before the license issues. The HMDR license is granted only after the facility passes inspection and all administrative items are satisfied.
After you’re licensed, any change to the information on your application has to be reported to the CDPH immediately. That includes ownership, address, and key personnel.9California Legislative Information. California Health and Safety Code HSC 111805
Fees and Annual Renewal
The application carries a non-refundable filing fee, and a separate warehouse fee applies if you operate a storage location. CDPH adjusts these amounts periodically; a 2024 fee increase letter set the annual out-of-state registration rate at $267 and the warehouse fee at $754, with in-state license fees and exemptee application fees also adjusted.10California Department of Public Health. 2024 HMDR Fee Increase Letter Check the Food and Drug Branch’s current schedule before you file.
Renewal is annual.2California Legislative Information. California Health and Safety Code HSC 111656 If the licensed premises stay closed longer than the period CDPH allows, and you haven’t obtained permission for the closure, the department can void the license entirely.3Justia Law. California Health and Safety Code Article 6 – Licenses Ongoing obligations include keeping your written policies and quality assurance program current and holding required records for at least three years.8California Legislative Information. California Health and Safety Code HSC 111656.3
Medicare Enrollment and Federal Accreditation
The state license lets you operate. Billing Medicare adds three federal steps: accreditation, a National Provider Identifier, and formal enrollment.
CMS requires every DMEPOS supplier to be accredited by a CMS-approved organization before enrolling.11Centers for Medicare & Medicaid Services. Enroll as a DMEPOS Supplier The current list of approved accreditors is published by CMS.12Centers for Medicare & Medicaid Services. DMEPOS Accreditation Organizations Accreditation evaluates your operations against national quality standards for patient care, business practices, and product safety, and it specifies the exact products and services you’re approved to supply.13Centers for Medicare & Medicaid Services. CMS-855S – Medicare Enrollment Application for DMEPOS Suppliers
Who Is Exempt From Accreditation
Certain licensed healthcare professionals are exempt when they supply equipment to their own patients. The exempt roles include physicians, physician assistants, nurse practitioners, physical therapists, occupational therapists, clinical nurse specialists, audiologists, and speech-language pathologists, among others. Pharmacies can apply separately for an accreditation exemption by submitting an attestation to the enrollment contractor.14Centers for Medicare & Medicaid Services. DMEPOS Accreditation These exemptions don’t excuse Medicare enrollment or the other supplier standards.
NPI and the CMS-855S
You need a National Provider Identifier for each practice location, obtained at no cost through the National Plan and Provider Enumeration System.11Centers for Medicare & Medicaid Services. Enroll as a DMEPOS Supplier
The last federal step is the CMS-855S enrollment application for DMEPOS suppliers. File it electronically through PECOS or submit a paper version to your region’s enrollment contractor.15Centers for Medicare & Medicaid Services. Enrollment Applications CMS may run an unannounced site visit before approving enrollment to confirm the facility meets federal supplier standards.
Surety Bond and Insurance
Medicare enrollment carries two financial requirements that catch some new suppliers off guard.
You must post a $50,000 surety bond for each NPI. The bond has to stay continuously in force; if it lapses, CMS revokes your billing privileges retroactive to the lapse date, and you have to repay any Medicare payments received during the gap.6eCFR. 42 CFR 424.57 – DMEPOS Supplier Standards An adverse legal action in the past ten years can trigger an elevated bond of $50,000 per occurrence on top of the base amount. Government-operated suppliers, sole-owner orthotists and prosthetists billing only for their own products, and physicians or other practitioners furnishing items only to their own patients can qualify for an exception.16Federal Register. Medicare Program – Surety Bond Requirement for Suppliers of Durable Medical Equipment, Prosthetics, Orthotics and Supplies
You must also carry comprehensive general liability insurance of at least $300,000 per incident, covering the place of business, all customers, and all employees. Suppliers who manufacture their own items also need product liability and completed operations coverage. A lapse in insurance triggers the same retroactive revocation as a bond lapse.6eCFR. 42 CFR 424.57 – DMEPOS Supplier Standards
Medi-Cal Enrollment
Medi-Cal enrollment is handled separately from Medicare. DME providers apply through PAVE, the state’s Provider Application and Validation for Enrollment system.17DHCS. Durable Medical Equipment Application Information You’ll generally need an active HMDR license, an NPI, and your business documentation. Enrollment lets you receive reimbursement for equipment furnished to the state’s Medicaid beneficiaries, a sizable patient population in California. Many DME businesses pursue Medicare and Medi-Cal enrollment at the same time.
What Non-Compliance Costs
At the state level, any violation of California’s HMDR statutes or related regulations is grounds for the CDPH to deny, suspend, or revoke a license.3Justia Law. California Health and Safety Code Article 6 – Licenses Dispensing prescription devices without a pharmacist or licensed exemptee in charge is independently unlawful under the same statute, and the CDPH can revoke individual personnel registrations for violations of the Health and Safety Code or the Business and Professions Code.
Federal penalties for DMEPOS fraud are steeper. The False Claims Act carries civil penalties per claim plus treble damages tied to the government’s losses, and each item or service billed counts as a separate claim, so totals mount quickly.18Federal Register. Civil Monetary Penalties Inflation Adjustments for 2025 The Anti-Kickback Statute adds criminal penalties, including imprisonment, and civil monetary penalties for each kickback plus three times the amount of the improper payment. Either law can also result in permanent exclusion from all federal healthcare programs, which effectively ends a DME business built on Medicare or Medi-Cal revenue.