To operate a durable medical equipment business in California, you must hold 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 any equipment for home use.1California Department of Public Health. Home Medical Device Retailer License Application The California DME license requirements cover the state application, Live Scan background checks, a facility inspection, and annual renewal. If you also intend to bill Medicare or Medi-Cal, a separate layer of federal accreditation, a surety bond, liability insurance, and program enrollment applies on top of the state license.
Who Needs an HMDR License
California requires an HMDR license for any facility that sells, delivers, or rents durable medical equipment to patients for home use. That covers hospital beds, wheelchairs, oxygen equipment, and other mobility or respiratory aids. The license is annual and cannot be transferred to another owner or location.2California Legislative Information. California Health and Safety Code HSC 111656
If your facility handles prescription medical devices such as certain oxygen systems, ostomy supplies, or urinary catheters, you must have either a pharmacist-in-charge or a licensed Home Medical Device Retailer Exemptee on the premises whenever those devices are dispensed or fitted.1California Department of Public Health. Home Medical Device Retailer License Application Operating without that supervision is a separate violation under state law.3Justia Law. California Health and Safety Code Article 6 – Licenses
One boundary worth noting: out-of-state businesses that ship medical devices into California do not need a full HMDR license, but they must register with CDPH as an out-of-state facility.4California Department of Public Health. Home Medical Device Retail Program
What to Have in Place Before You Apply
Formalize the business entity first, whether a corporation, an LLC, or another structure, and get a Federal Employer Identification Number. Line up any local business permits and confirm your location complies with zoning rules.
The facility itself must maintain 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’ll need dedicated commercial space for storing inventory and conducting business, sanitation controls, and secure protection of both equipment and patient records.
If Medicare billing is part of the plan, federal rules add facility standards on top: a minimum of 200 square feet, visible signage with posted hours, a landline business phone (not just a cell phone), and public hours of at least 30 hours per week.6eCFR. 42 CFR 424.57 – DMEPOS Supplier Standards It’s worth confirming these before signing a lease; retrofitting a space that fails the site visit is expensive.
Completing the HMDR Application
The form is the Home Medical Device Retailer License Application, CDPH 8679.1California Department of Public Health. Home Medical Device Retailer License Application It calls for full disclosure of ownership, including the names and titles of all owners and officers, plus documentation showing the business is financially solvent enough to operate responsibly. Attach proof of the physical facility, such as a lease and local permits.
Every owner and key employee must complete a background check through California’s Live Scan fingerprinting system. A certified fingerprint roller captures your prints electronically and submits them to 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 codes specific to the HMDR program, not a generic form from another agency.
Your package must also include the facility’s written policies and procedures. California law spells out what these have to cover: staff and patient training, equipment cleaning and maintenance, emergency service availability for device malfunctions that could threaten patient health, record-keeping protocols, storage and security of prescription devices, and an ongoing quality assurance program.8California Legislative Information. California Health and Safety Code HSC 111656.3 Records of employee training and competence must be kept for at least three years after an employee’s last day.
Review, Inspection, and Issuance
Once CDPH receives your completed application and fees, the Food and Drug Branch reviews the package for completeness. Missing items trigger a deficiency notice, and you’ll need to respond promptly. Review can stretch to several months depending on the complexity of your application and current volume.
After the paper review comes a mandatory on-site inspection. Inspectors verify that inventory is stored securely, that required records are maintained and accessible, and that any licensed pharmacist or exemptee is present as required. If the facility falls short, CDPH will require corrective action and a follow-up inspection before issuing the license.
Once licensed, you must notify CDPH immediately of any change to the information reported on your application, including ownership, address, or key personnel.9California Legislative Information. California Health and Safety Code HSC 111805
Fees and Annual Renewal
The HMDR application requires a non-refundable filing fee, plus a separate warehouse fee if you operate a storage location. CDPH adjusts the amounts periodically. A 2024 fee-increase letter listed the annual out-of-state registration at $267 and the warehouse fee at $754, with in-state license fees and exemptee application fees also subject to adjustment.10California Department of Public Health. 2024 HMDR Fee Increase Letter Check the CDPH Food and Drug Branch site for the current schedule before you file.
Renewal is annual.2California Legislative Information. California Health and Safety Code HSC 111656 If your licensed premises stay closed beyond the period CDPH allows and you haven’t received permission for the closure, the department can void the license entirely.3Justia Law. California Health and Safety Code Article 6 – Licenses Between renewals, keep the written policies current, maintain the quality assurance program, and retain required records for at least three years.8California Legislative Information. California Health and Safety Code HSC 111656.3
Medicare Enrollment on Top of the State License
The state license lets you operate. Billing Medicare adds three more federal requirements: accreditation, a National Provider Identifier, and formal enrollment.
CMS requires every DMEPOS supplier to obtain accreditation from a CMS-approved organization before enrolling in Medicare.11Centers for Medicare & Medicaid Services. Enroll as a DMEPOS Supplier As of January 2026, eight organizations hold CMS approval, and the current list 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 your accreditation must specify the exact products and services you’re approved to supply.13Centers for Medicare & Medicaid Services. CMS-855S – Medicare Enrollment Application for DMEPOS Suppliers
Certain licensed clinicians, including physicians, physician assistants, nurse practitioners, physical and occupational therapists, clinical nurse specialists, audiologists, and speech-language pathologists, are exempt from DMEPOS accreditation when supplying items to their own patients. Pharmacies can apply separately for an accreditation exemption by submitting an attestation to the enrollment contractor.14Centers for Medicare & Medicaid Services. DMEPOS Accreditation The exemption does not remove the requirement to enroll in Medicare or meet the other supplier standards.
You need a National Provider Identifier for each practice location, issued through the National Plan and Provider Enumeration System at no cost.11Centers for Medicare & Medicaid Services. Enroll as a DMEPOS Supplier Enrollment itself is done on Form CMS-855S, filed electronically through PECOS or on paper to your region’s enrollment contractor.15Centers for Medicare & Medicaid Services. Enrollment Applications CMS may also conduct an unannounced site visit to confirm the facility meets federal supplier standards before approving enrollment.
Surety Bond and Liability Insurance
Medicare enrollment carries two financial obligations that catch some new suppliers off guard.
You must post a surety bond of $50,000 for each NPI you maintain. The bond has to stay continuously in force. If it lapses, CMS revokes your billing privileges retroactive to the lapse date, and you must 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. If you manufacture your own items, the policy must include product liability and completed operations coverage. A lapse in insurance triggers revocation of billing privileges retroactive to the date of the lapse, on the same terms as the bond.6eCFR. 42 CFR 424.57 – DMEPOS Supplier Standards
Medi-Cal Enrollment
Enrolling with Medi-Cal is a separate process from Medicare enrollment. DME providers submit applications through PAVE, the state’s Provider Application and Validation for Enrollment system.17DHCS. Durable Medical Equipment Application Information You’ll generally need your active HMDR license, NPI, and business documentation. Many DME businesses pursue both Medicare and Medi-Cal enrollment at the same time to cover the widest eligible patient base.
What Happens If You Don’t Comply
At the state level, a violation of California’s HMDR statutes or related regulations is grounds for CDPH to deny, suspend, or revoke the 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. CDPH can also revoke the registration of individual personnel for violations of either the Health and Safety Code or the Business and Professions Code.
Federal penalties for DMEPOS fraud are steeper. Under the False Claims Act, submitting false claims to Medicare can result in civil penalties ranging from $14,308 to $28,619 per claim, plus treble damages based on the government’s losses. Each item or service billed counts as a separate claim.18Federal Register. Civil Monetary Penalties Inflation Adjustments for 2025 The Anti-Kickback Statute carries criminal penalties, including imprisonment, and civil monetary penalties of up to $50,000 per kickback plus three times the improper payment. Violations under either law can also result in permanent exclusion from all federal healthcare programs, which effectively shuts down any DME business that relies on Medicare or Medi-Cal revenue.