By all accounts, the effects of CMS' proposed revision and expansion of supplier standards for DMEPOS will be far-reaching. In a special series for HomeCare Monday leading up to the March 25 deadline for comments, health care attorney Neil B. Caesar, president of the Health Law Center, Greenville, S.C., will help provide clarification and insight on several provisions of the draft rule.
This week, Caesar's comments are directed to a change in existing standard No. 1, which deals with state and federal licensure and regulatory requirements:
This standard right now states that a supplier must operate its business according to all state and federal licensure and regulatory requirements. Basically, that's been interpreted to date to require a supplier to have all the necessary DME licenses, specialty certifications, occupancy permits and everything else required under federal, state or local law.
The proposed changes include a clarification and a modification. The clarification is that CMS is making it clear the government has no responsibility whatsoever for helping the supplier determine what licenses or other kinds of requirements are necessary to operate in that state.
"While the [National Supplier Clearinghouse] maintains information regarding state licensure laws, we do not believe that the NSC is responsible for notifying any supplier of what licenses are required or that any changes have occurred in the state licensing requirements," CMS' comments say.
This will mean any supplier who historically has taken the attitude "If I missed something, the NSC will tell me and I will fix it then," cannot embrace that lackadaisical approach after this clarification takes effect.
Further, CMS makes clear that if a supplier contends that there is an exception to some state rule, the supplier will have to show clear evidence that the state has that exception in place. That means a supplier would not be able to rely on a telephone comment from some state official or an inference about what other companies are doing to conclude that the state rules do not apply to that supplier. Clear, written evidence will be necessary.
Most important is an effort by CMS to bring everything "in house" for the supplier. Specifically, CMS contends that any state licenses required in order for a supplier to supply certain services must belong to the supplier itself or to its employees. In other words, suppliers will not be allowed to have a contract relationship with an individual or entity for licensed services but must hire the licensed individual as a W-2 employee.
In explaining the rationale for this change, CMS said: "We believe that we are enrolling DMEPOS suppliers, not third-party agents that subcontract their operations ... therefore to ensure that only qualified suppliers are enrolled ... we maintain that a DMEPOS supplier ... cannot contract with an individual or entity to provide the licensed service(s)."
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.
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.
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proposed standards and revisions.