The Devil's in the Details

While most folks are familiar with last year's Medicare Modernization Act (MMA) and its larger DME provisions, now is the time to understand the Act's many details, for it is these details that tell us where CMS has leeway to make different implementation decisions, and where it doesn't. Where CMS does have discretion, the industry has an opportunity to influence the agency to make the better decision.

Mandatory Accreditation

The HHS Secretary must establish and implement “quality standards” to be applied by independent accreditation organizations. DME suppliers will be required to comply with these quality standards to retain their Medicare supplier number and to provide DME to beneficiaries.

Importantly, there is no deadline for the Secretary to establish these standards. CMS has indicated that it will seek advice from the Program Oversight and Advisory Committee (POAC), which will advise CMS on its implementation of its “competitive acquisition” program (see below).

Once CMS establishes the quality standards, which will likely be published in the Federal Register as well as on CMS' Web site, the Secretary has one year to designate and approve one or more independent accrediting organizations, such as the Joint Commission on Accreditation of Healthcare Organizations (JCAHO), the Community Health Accreditation Program (CHAP) and/or the Accreditation Commission for Health Care (ACHC). Organizations that provide DME, prosthetics and prosthetic devices, orthotics, medical supplies and parenteral and enteral nutrition will be required to comply with the quality standards.

Competitive Acquisition

We call it “competitive bidding.” Congress calls it “competitive acquisition.” CMS is required under the statute to establish competitive acquisition programs in the nation's 10 largest metropolitan statistical areas in 2007 — New York-Northern New Jersey, Los Angeles, Chicago, Washington-Baltimore, San Francisco-Oakland-San Jose, Philadelphia-Wilmington, Boston, Detroit, Dallas and Houston — and in 80 of the largest MSAs in 2009.

Competitive acquisition applies to all DME, including items used in infusion and drugs and supplies used in conjunction with DME, enteral nutrition and supplies and off-the-shelf orthotics. Congress excluded inhalation drugs used with DME, Class III devices and parenteral nutrition and supplies from competitive acquisition.