Providers Question Proposed Revision to Supplier Standard No. 1
ATLANTA–With just over a week left before the comment period
ends March 25, some of HME’s main movers and shakers are still
grappling with the potential effects of CMS’ proposed revision to
Supplier Standard No. 1.
As part of an overhaul of its DMEPOS enrollment standards, the
agency’s changes to Standard No. 1 would require that providers
offering licensed services employ such personnel as W-2 employees,
not 1099 independent contractors. That is a key change for the vast
number of suppliers that, for example, use nurses and respiratory
therapists on a contract basis.
“For the larger companies, [bringing on specialists as
full-time employees] will not be much of a problem, but for the
small mom-and-pop companies, which are the majority in this
industry, it will definitely put a hardship on them,” said
Wayne Link, president of Link Consulting Group, Columbus, N.C.
A requirement like this could put small providers out of
business, Link said, “and by doing this, we all know there
will be no customer service.”
Neil B. Caesar, president of the Health Law Center in
Greenville, S.C, summed up the proposed measure this way:
”This change would require significant staffing changes
for many suppliers who currently contract on an independent basis
with respiratory therapists, nurses and other individuals subject
to state licensure and other related requirements.
”In my opinion, CMS is imposing an unnecessary hardship on
suppliers with this rule, because they must already be responsible
for their personnel’s performance, regardless of employment status.
There are many less-disruptive ways for CMS to gain compliance
assurances–subcontractors can be identified and listed,
performance and supervision requirements could be monitored, and
further, W-2 employment status does not, in itself, create a
mechanism or an obligation for the supplier to ensure that the
employee is performing consistent with licensure requirements.
“Regardless, if this change takes effect, that supplier’s
relationships with agencies or independent professional groups will
change dramatically.”
Jerry Keiderling, president of Waterloo, Iowa-based VGM Group’s
U.S. Rehab, said there needs to be a clear understanding of how
Standard No. 1 would affect rehab providers in particular.
On April 1, the CMS DME Program Safeguard Contractors will begin
requiring that rehab equipment come from a provider employing an
Assistive Technology Supplier who is certified by the
Rehabilitation Engineering and Assistive Technology Society of
North America and “who specializes in wheelchairs and has
direct, in-person involvement in the wheelchair selection for the
patient.”
”There are rehab providers that saw and heard from medical
directors and CMS that it was permissible to contract an
ATS,” Keiderling said. “Now, apparently under the new
standards, you can’t. Come April 1 [if this standard is finalized],
those providers that have their contracts in place [with an ATS]
will not be compliant.”
The proposed changes were published Jan. 25, and at press time
on Friday, industry groups including the American Association for
Homecare, the National Association of Medical Equipment Suppliers,
VGM and Lubbock, Texas-based The Med Group were still finalizing
their comments to send to CMS.
In its rough draft, however, AAHomecare said it generally
supports Standard No. 1, but noted:
”The proposed regulation would require suppliers to
furnish directly through employees any items or services for which
a state requires a professional license. For example, if a state
requires that a respiratory therapist set up oxygen patients, the
supplier would be required to furnish that service directly through
an employee rather than under arrangements with a subcontractor.
Suppliers should have the ability to adjust staffing based on the
demands of the markets in which they operate. We request that CMS
clarify that this standard can be met through the use of part-time
or per-diem employees as long as these individuals are W-2
employees.”
AAHomecare added: “Our interpretation of the proposed rule
is that the prohibition on subcontracting applies only when state
law would require that a licensed professional provide an item or
services. In other words, if the state law is silent on whether a
professionally licensed individual must furnish an item or service,
then a supplier may furnish that item or service under arrangements
with a licensed professional.”
For their part, representatives from RESNA and the National
Registry of Rehabilitation Technology Suppliers noted that
requiring providers to keep licensed employees on staff can only
serve to help Medicare beneficiaries.
“RESNA believes that this will benefit the consumer
because there will be better continuity of service,” said
Anjali Weber, director of certification. “Our concern is also
that sometimes subcontracted individuals may be available for the
evaluation but not for the follow-up service, so you have a
disjoint. In-house capability to address needs from start to
finish, including modifications, repair and service to complex DME
ensures that consumers are better served.”
Weber went on to say that, while there may be a negative
financial impact on HME providers, Standard No. 1 would also
benefit Medicare by helping to eliminate fraud.
“We do recognize that there is a financial impact on the
suppliers to earn certification, but there is a need for a quality
standard. This offers another level of protection–another consumer
safeguard–from fraud and abuse. Complex rehabilitative equipment
requires specialized skills and knowledge for individuals with
changing, long-term needs to ensure a good outcome from evaluation
to final follow-up.”
While NRRTS Executive Director Simon Margolis also said
certified staff could only improve services offered to Medicare
beneficiaries, he pointed out that CMS’ proposal could cause
“an access problem.”
“On one side, in the smaller rural areas and even in some
smaller cities, there just are not enough of these people. In the
Unites States, there are only about 2,000 ATSs and ATPs. Of those
2,000, about 80 or 90 already work for suppliers so they can’t do
the evaluations,” Margolis said. “On the other hand,
it’s important to have the contractor on staff to ensure that
continuous service is not broken by a broken contract.”
Whether or not providers support the revision to Standard No.
1–or any of CMS’ proposed standards changes–they should
“get involved” in shaping the outcome with their comments
before the March 25 deadline passes, Link said.
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