In a perplexing turn, CMS issued a proposed rule that requires a face-to-face exam by a physician who orders home health services under Medicaid. The proposal also requires a face-to-face encounter for DME

BALTIMORE — In a perplexing turn, CMS issued a proposed
rule July 5 that requires a face-to-face exam by a physician who is
ordering home health services under Medicaid. The proposal also
requires a face-to-face encounter for DME under both Medicare and

Mandated as a provision under the Affordable Care Act, the
face-to-face requirement has been in effect for home health
agencies billing Medicare since April 1, but CMS has not yet issued
the Medicare policy for DME.

"The proposed rule indicates the items that will be subject to
the DME face-to-face exam requirement for Medicare will also
require a face-to-face exam prior to ordering the items under
Medicaid," the American Association for Homecare told members in
its weekly newsletter.

The question is, how can CMS mandate that HME providers stick to
Medicare face-to-face provisions that have not yet been

"We are trying to get some clarification from CMS and notify
providers, because it is definitely confusing," said Stacey Harms,
AAHomecare's manager of government affairs. She added that the
association has been in discussions with CMS for several months
about which DME items should fall under the requirement.

"That's why we were a little shocked," Harms said. "We knew [the
face-to-face exam] was going to be applied to home health for
Medicaid, but we were surprised that DME was included."

While the health reform law calls for beneficiaries to have a
face-to-face exam for all DME, the proposed rule said some items
will be exempt under Medicare — those of "small dollar value,
and at a decreased risk for fraud, waste, and abuse" — and
those items would also not require a face-to-face exam under

CMS said it would issue guidance for states about the items
subject to the rule.

For DME that is subject to the Medicare requirement, according
to the rule, "the physician must document that a face-to-face
encounter that is related to the primary reason the individual
requires the item has occurred no more than 90 days before the
order is written or within 30 days after the order is written."

Harms said while AAHomecare has heard from some Medicaid
agencies that they might make the face-to-face exam retroactive to
January, "since Medicare hasn't issued a face-to-face exam [rule
for DME providers] yet, I don't think there is anything they can

AAHomecare staff spoke with CMS about the status of the DME
requirement in June, Harms said, and the agency was not too far
into the process then.

"The DME rule is a little ways out, I think," she said.

In the proposed rule, CMS also clarifies the definition of
"medical supplies, equipment and appliances," which is the term
used for DME under the Medicaid home health services benefit.
According to AAHomecare, the rule:

  • Clarifies that home health services are not restricted to
    patients who are homebound or to services furnished in the home by
    modifying the phrase "suitable for use in the home" to indicate
    covered items must be "suitable for use in any non-institutional
    setting in which normal life activities take place." This
    clarification is to ensure that states do not deny items and
    services based on grounds that they will be used outside of the

  • Proposes criteria to define "home health supplies, equipment,
    and appliances" to better align Medicaid with the Medicare
    program's definition of DME. Here's how the rule proposes to define
    medical equipment:

    • "Supplies are defined as health care related items that are
      consumable or disposable, or cannot withstand repeated use by more
      than one individual."

    • "Equipment and appliances are defined as items that are
      primarily and customarily used to serve a medical purpose,
      generally not useful to an individual in the absence of an illness
      or injury, can withstand repeated use, and can be reusable or

View a PDF of the proposed rule.