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.