Home Health & Hospice Week

Expect to do more with less under tougher regulations and increased scrutiny.

DME providers will have their work cut out for them this year, as they contend with competitive bidding and tougher quality standards.

As the Centers for Medicare & Medicaid Services moves forward with new quality standards and a final rule on competitive bidding for durable medical equipment, suppliers will face rising expenses and falling revenue, predicts attorney Robert Falk with the Washington, DC office of Powell Goldstein Frazer & Murphy.

Add in the budget cuts coming from Congress and DME suppliers can expect to see their margins become thinner, warns Falk.

Quality Standards, Bidding On Deck

Get ready for tightened quality standards, experts warn. As CMS finalizes the quality standards and awards accreditation organizations contracts to certify suppliers, "there will be a lot of interest around what quality standards will be, and how suppliers can conform to them in order to get accredited," says Eric Sokol, of the Washington-based Power Mobility Coalition.

In the past few years, issues like the interim final rule on coverage criteria and the federal crackdown on wheelchair fraud have specifically focused on wheelchair suppliers, says Sokol. "In 2006, there will still be a lot of issues impacting wheelchair suppliers, but now all of DME will be impacted," he says.

Competitive bidding will also be a major issue in 2006 if CMS hopes to meet the planned congressional time line, he says.

Look for more consolidation in the industry as a result of the competitive bidding and quality standards initiatives, warns Falk. "It's just going to be much harder for the smaller guys to do business."

Competitive bidding will drive some people out of business and create opportunity for other people, he warns.

Expect Increased Review

DME suppliers are more likely to get hassled by fraud scrutiny this year, experts predict. More sophisticated fraud detection techniques mean more review of suppliers, says Falk.

The National Supplier Clearinghouse is also feeling pressure to be a better enforcer of the supplier standards, Falk adds. The small players who have haven't attracted much scrutiny in the last few years "may not fly under the radar screen anymore. And the concept that they 'just didn't know' isn't going to hold," Falk maintains.

Rule Puts Brakes On Wheelchair Suppliers

Wheelchair suppliers will have special concerns where the interim final rule on power mobility is concerned, says Sokol. Although it has been delayed, the re-release of the interim final rule and the resulting elimination of the Certificate of Medical Necessity requirement will be a major issue this year.

In the Power Mobility Coalition's view, the reimbursement environment created by the interim final rule lacks objectivity and will allow CMS total discretion to deny claims, says Sokol. He predicts a struggle over CMS' authority to deny claims and the industry's attempts to return the objectivity to the claims process that the CMN provided.

Capped Rental Leaves Suppliers Gasping

The cap on oxygen rental at 36 months included in the Senate's budget reconciliation bill may leave some DME suppliers short of breath. Fortunately, there are 36 months before the first affected rentals would reach their cap, "so it gives us a long time to fight to get rid of it," says Wayne Stanfield of the Halifax-based Home Care Alliance of Virginia.