CMS: Accreditation to Begin With 10 MSAs

BALTIMORE–Mandatory accreditation for Medicare DME suppliers
will start with the 10 metropolitan statistical areas where
competitive bidding will take place in 2007, a CMS official said
last week.

Confirming what insiders have been speculating for some time,
the announcement that accreditation will be implemented in stages
was made during a special CMS Open Door Forum on the newly released
draft of quality standards for suppliers (see HomeCare
Monday, Sept. 26). The forum, which included attendance of
65 and another 420 phone participants, was held last Monday as part
of a scheduled meeting of the government’s Program and Advisory
Oversight Committee, a 22-member panel that is advising CMS on
national competitive bidding.

Eventually all DMEPOS suppliers who want to participate in
Medicare will have to meet the quality standards–including
business and product-specific requirements–which will be applied
by CMS-approved accrediting bodies as mandated under the Medicare
Modernization Act.

But frustration and confusion with the proposed standards–and
CMS–was apparent following release of the draft, developed by CMS
contractor Abt Associates, Cambridge, Mass. Before the meeting
started, stakeholders scrambled to make sense of the 104-page
document, which was released on Sept. 23, the Friday before the
Monday PAOC meeting.

“I appreciate the detail and the work that’s gone into the
document, but I was a little concerned that we only had in essence
a business day to review a 100-page document to provide some
comments,” Don Clayback, senior vice president of networks for
Lubbock, Texas-based The Med Group, told CMS during the forum.

CMS also announced a revised timeline for the process, raising
new concerns that providers who want to take part in Medicare’s DME
bid may not have enough time to get accredited before 2007.
According to Linda Smith, CMS project officer, the final quality
standards now will likely be published in March or April of 2006,
at the same time that the 10 MSAs where bidding is to begin will be
announced. Only then, after the stardards are finalized, will the
agency release information on how accreditation organizations can
apply for “deemed status” to become official accrediting
bodies.

Clayback estimated that, according to the CMS timeline,
selection of the accreditors would occur in the summer or fall of
2006. Smith responded with few details: “When the rule is final and
published, we will then provide the Federal Register notice
to receive application from accreditation organizations. I cannot
give you a specific date.”

Previously, approved accreditors were expected to be named by
the year’s end or by early 2006 at the latest.

“It’s not the progress we thought would be made by this time
this year,” said forum attendee Mary Ellen Conway, president of
Capital Healthcare Group, a Bethesda, Md.-based health care
consulting firm. “I think it’s frustrating because it really
doesn’t move the process along in a timely manner.”

Providers who are already accredited by one of several current
HME accrediting bodies could be grandfathered in–but only if those
organizations’ standards meet the final CMS standards, according to
Smith.

“How do they expect suppliers to go forward and prepare? CMS is
not giving them the information they need,” said PAOC member Seth
Johnson, director of government affairs for Exeter, Pa.-based Pride
Mobility. “There’s a lot of apprehension out there to go forward
with accreditation when [providers] are not confident the agency
they’re going with will be grandfathered.”

About Those Quality Standards
Some industry stakeholders say that in their current form, the
proposed supplier standards are both confusing and impractical. The
draft document focuses on two areas: business standards and
product-specific requirements for providers who specialize in
particular categories, such as oxygen, support surfaces and power
wheelchairs. Several proposed financial requirements were singled
out by attendees as cause for concern.

“It was clear to me that, overall, the people who prepared the
draft report had real gaps in understanding of HME operations and
of health care,” said Wallace Weeks, president of Weeks Group, a
Melbourne, Fla.-based strategy consulting firm.

For example, he noted after the meeting, one of the financial
requirements calls for an audited financial statement, something
that he said is completely unrealistic for a small provider.
Although the standards do not specify whether the audits need to be
internal or external, it could cost a provider from $6,000 to
$7,000 to have one completed by a CPA. “This is an asinine
requirement,” he said. “If providers are going to be required to
have a CPA complete an audited financial statement on an annual
basis, this will pose an insurmountable problem for the
industry.”

A requirement to notify CMS of “potential adverse financial
operations” that could lead to delayed payments or bankruptcy
disturbed Tim Pederson, president and CEO of WestMed Rehab, Rapid
City, S.D. “That’s very ambiguous, very vague, and it begs the
question: Why is it included? All providers have financial issues
like this,” he told officials during the Open Door session. “Does
this mean we’ll be sanctioned or punished [or that] payments will
be withheld, which would exacerbate the situation even more? I
don’t think there’s a provider in this room that isn’t behind in
payments to one … manufacturer or another.”

CMS’ Smith responded that the agency had found “by the time
suppliers notify CMS usually they’re in real trouble and almost out
of the program, or they’re so far behind that they can’t get
financially stable.” She said the requirement “was not meant to be
punitive but to enhance communications early on in an attempt …
to work together” to resolve such problems.

The business standards outline requirements in eight areas:
administration, financial management, human resource management,
beneficiary services, performance management, equipment and safety,
beneficiary rights and ethics and information management. These
comprise 11 pages of the proposal, while another 89 are devoted to
product-specific requirements that outline service standards and
requirements for inspection, delivery/set-up, beneficiary
education/training and follow-up for suppliers specializing in 14
different categories. Requirements in another 18 categories are to
be developed by CMS and Abt Associates as the project
continues.

“It’s overkill,” Conway said of the product-specific
requirements. “Products are going to change and requirements are
going to change. Why wouldn’t they just leave it to manufacturer’s
guidelines?”

Other attendees expressed concern that the standards would
hinder access to care, especially in the case of rural providers
who often serve large areas and have trouble hiring staff–such as
wound care specialists or rehab technologists–with the specific
qualifications the CMS standards require.

“Some things are just impossible to do,” said Mike Hamilton,
executive director of the Alabama Durable Medical Equipment
Association (ADMEA) and Georgia Association of Medical Equipment
Services (GAMES).

He cited a requirement that oxygen suppliers respond within 60
minutes of a telephone call. “Can you imagine a supplier in any
place with traffic jams being able to respond?” he asked?

“Some of the standards are just so far-fetched and removed from
reality that it would put 60 percent or more suppliers out of the
business if they had to comply,” said Hamilton. “They are appalling
and have got to undergo a major overhaul.”

Although Pride’s Johnson said he also was disappointed the
quality standards weren’t “further along,” he said he was heartened
that CMS said it will be requesting volunteers to serve on
product-specific workgroups for further feedback. “I think it’s
good they’re forming these workgroups and CMS isn’t just doing this
in a vacuum without the industry’s input.”

To view a draft of the standards,
click here.

CMS will accept public comment on the draft standards until Nov.
28. Comments can be e-mailed to [email protected].