WASHINGTON--For years, home medical equipment providers have been asking for further guidance on what many have called vaguely written supplier standards with inconsistent interpretation among inspectors and lax oversight. On Friday morning they got a response from CMS--in spades plus some.
In an 11-page draft rule published in the Federal Register, CMS proposed clarification and expansion of existing standards along with the addition of others that all HME providers must meet to participate in Medicare and retain billing privileges.
"For many years, concern about easy entry into the Medicare program by unqualified or even fraudulent providers or suppliers has led us to increase our efforts to establish more stringent controls," CMS said in explaining the proposal. The agency said the additions and modifications are necessary "to ensure that legitimate DMEPOS suppliers are furnishing items of DMEPOS to Medicare beneficiaries."
"These changes are substantive and dramatic in many respects, and they will alter the way many suppliers do business," said industry attorney Neil Caesar, who runs the Columbia, S.C.-based Health Law Center. Caesar added he thinks "it is likely that most of these proposals will become law."
Following are some among the proposed rule's changes to existing standards:
--A change to standard No. 1, which deals with state and federal licensure and regulatory requirements, would require that suppliers providing licensed services not contract out those services. In order words, personnel furnishing licensed services (in states that require licensing of any aspect of a provider's business) must be "W-2 employees, not 1099 independent contractors," Caesar said. "A huge number of suppliers have their nurses and respiratory therapists working on a contract basis," Caesar pointed out. "That's a major change that will affect not just a lot of suppliers, but a whole lot of suppliers."
--CMS would expand existing standard No. 7 regarding physical facilities and appropriate sites. The agency is proposing that hours of operation be posted on permanent signage at the main entrance to the supplier location, even if the business is in a building complex where it is not the only tenant. "That means everything showing who you are, where you are and when you are open" has to be posted at the main entrance, Caesar said. "That's going to be a problem with a lot of buildings because the landlords don't do this for any of their tenants. It may be contrary to the signage options that are available."
In addition, the location must be staffed during the posted hours and must be accessible "regardless of whether beneficiaries routinely visit the facility," according to the proposal. The requirement also would apply to "closed door" businesses, such as pharmacies or suppliers providing services only to beneficiaries in a nursing home. "A supplier is not in compliance with this standard if no one is available during the posted hours of operation," CMS said.
Under standard No. 7, the agency is also seeking comments on whether to establish a minimum square footage requirement, and notes that suppliers must meet "applicable local zoning requirements."
--A revision to standard No. 9 "is a big one having to do with the business telephone," Caesar said. While the current standard requires a phone number to be listed in the directory and prohibits a cell phone number as the primary business telephone, "what they are thinking about is expanding the old rule to say you can't use a cell phone or a beeper as a method of receiving calls, or call forwarding to forward calls to a cell phone or a beeper." The proposal also prohibits answering machines, answering services or fax machines as the primary business phone during operating hours.
"What they are really trying to do here is to force suppliers to operate in a traditional retail context regardless of whether they are doing retail," Caesar said. "The ability to field calls from the road is really being curtailed under these proposed rules," he continued. "They tout the problem of questionable businesses as the reasoning behind the rule, but it is going to affect many one- or two-man operations where they have to multi-task and are often off-premises."
Under this revision, Caesar said, "the phone rings on location and someone on location picks it up."
--CMS has proposed two changes to standard No. 10, which requires $300,000 in comprehensive liability insurance. "The differences are that now the policy will be required per incident, and it has to expressly cover both the place of business and all customers and employees," Caesar said. "In addition, you will have to have this in force before you apply to enroll in the Medicare program, which means you are going to have to pay for the policy not knowing whether you are going to get a supplier number."
--A revision to standard No. 11, which nixes contacting beneficiaries by telephone in order to solicit business, extends the prohibition to email, instant messaging, Internet advertising on sites unrelated to DMEPOS products and in-person contacts. "Basically you can't do cold-calling unless you're an exception, the exception being you've had a recent relationship with the person or they've given you permission to do it," Caesar said, adding that CMS "is making it clear they are cracking down on enforcement. You can lose everything if you violate this."
Among new supplier standards, CMS is proposing:
--That suppliers obtain oxygen from state-licensed oxygen suppliers. The standard would only apply in states that license oxygen suppliers, but when a DME company is located in a state that requires licensing for oxygen suppliers, the company must obtain oxygen from a licensed supplier, regardless of the state where the oxygen supplier is licensed.
--That historic ordering and referring documentation, including NPI numbers, be maintained for seven years after claims have been paid.
--That suppliers cannot share a location with other Medicare suppliers, including physicians. "Because they recognize that could create issues for medical practices or doctors who also supply DME, CMS is soliciting comments on what to do about that," Caesar said.
--That suppliers must be open to the public a minimum of 30 hours per week (either six hours a day, five days a week or five hours a day, six days a week). "We believe that ... all legitimate DMEPOS would need to be open at least 30 hours a week in order to attract, retain and serve Medicare beneficiaries," according to the proposal. According to Caesar, this could be another significant issue for small providers "who must handle both the office activities and deliveries. They will have to be in the office a significant amount of time, which could limit routine delivery times," he said.
--That suppliers cannot have an IRS or a state "tax delinquency," defined as money owed, a conviction for or a charge of tax evasion, or a tax lien. Providers who do not comply with this standard will have billing privileges revoked, CMS said. In its reasoning, the agency noted a report from the Government Accountability Office that found more than 21,000 providers reimbursed under Part B owed taxes totaling more than $1 billion in 2005.
CMS will accept comments on the proposed rule until March 25.
Read the proposed rule in full.
For a review of current supplier standards, see "Are You on the
NSC's Naughty or Nice List?" by Neil B. Caesar and Kelly R.
Pickens,
HomeCare, May 200
