Rules, Rules and More Rules Why You Should Keep One Eye on Washington YOU PAUSED WHEN you saw "Washington" and "Wisdom" together, didn't you? But don't stop reading because of that - the purpose of this new column is certainly not to defend the wisdom of Washington policy makers. Rather, I hope to shed light on the ever-changing legal and regulatory challenges Congress, the Health Care Financing Administration and its durable medical equipment regional carriers seem to impose upon health care companies - including yours.

Let's begin with an overview of some the most important issues your health care company should be tracking.

The Mandates of Legislative Policy In all its wisdom, Congress produces a constant stream of policy proposals and updates, many of which might affect your business. Last fall, for example, much debate in Washington focused on HCFA's proposal to reduce Medicare reimbursement for certain pharmaceuticals. Providers that supply albuterol sulfate and some other drugs can better prepare their businesses for what might come if they understand the dynamics surrounding the debate.

Of particular note is Congress' interest in delaying or stopping those reductions. Indeed, protest from Capitol Hill led HCFA to announce in late November that it was suspending use of new average wholesale price data generated by the Department of Justice.

The Role of the DMERCs Providers often have issues with DMERC policies and how they are implemented. The DMERCs do not always interpret HCFA directives consistently. These rules are often open to revision, however, so it is important that you offer appropriate comment whenever a DMERC institutes a more restrictive medical coverage policy.

Closely tracking DMERC policies can also help you prepare your company for when a DMERC notifies you that it is conducting a medical review of certain beneficiaries you serve and needs documentation to substantiate medical necessity claims. Caution: If you haven't been audited by a DMERC, chances are you soon will be.

The Call to Compliance Providers must comply with a large and growing number of Medicare, Medicaid and other legal requirements. And the best way to ensure your company follows all the rules is to develop detailed compliance policies. In addition to serving as a training tool for your staff, your compliance plan can also function as an invaluable management tool, uncovering areas of legal vulnerability.

To ensure that you are up to speed on Medicare requirements, check out the Office of Inspector General's Compliance Guidance for DMEPOS suppliers, issued in June of 1999. You can download it from the "OIG Electronic Reading Room" at www.hhs.gov/progorg/oig. Just make sure to consult DMERC bulletins and updates released since then for any new requirements.

The Limits of Sales and Marketing To be successful, it is critical that your company develop sales and marketing programs. But it is also critical that they do not run afoul of Medicare and Medicaid anti-kickback laws. The OIG expanded its reach two years ago to cover companies that do not directly bill Medicare on behalf of beneficiaries. Both you and the manufacturers and third-party billing firms you work with must be careful that your marketing practices do not expose you - or any of your business partners - to government scrutiny or legal risk.