According to a spokesman for CMS, "97 percent of pharmacies meet the accreditation requirements and many other pharmacies are in various stages of the accreditation process."

Pharmacists that are not accredited cannot bill Medicare for DMEPOS; however, with a surety bond, they can continue to provide chemotherapy and inhalation drugs to Medicare beneficiaries.

Many of those who have neither accreditation nor a surety bond and who are banking on ultimately being exempted from the requirements have voluntarily terminated their Medicare enrollment, Popomaronis said, rather than having their billing numbers revoked.

“If they are revoked, then they can’t reapply for a year. If they step down, it’s like turning the switch back on [if an exemption comes through],” Popomaronis said.

Pharmacists have objected to both the requirements, calling the accreditation rule redundant, unnecessary and unfair and the surety bond too burdensome cost-wise. Some have argued that the amount of Medicare business they do doesn’t justify the expense for accreditation or the bond.

“We’re licensed, we’re regulated, we have product and liability insurance,” Popomaronis said, adding that Boards of Pharmacy also oversee the sector. The NCPA and other pharmacy organizations believe pharmacists are entitled to the exemption CMS has already granted to other health care professionals such as physicians, prosthetists and occupational and physical therapists.

The pharmacy groups have taken their case to Capitol Hill, and some legislators agree. An exemption was included in Sen. Harry Reid’s (D-Nev.) original jobs bill, and it is included in President Obama’s proposed health care plan, Popomaronis said.

However, Reid, the Senate majority leader, has since introduced a vastly scaled-down jobs bill, and the provision is not in it, according to Mark Higley, vice president of development for Waterloo, Iowa-based VGM Group.

But that doesn’t trouble Popomaronis.

“Congress is looking at exemptions for pharmacists,” he said, noting he believes the provision could be added back into the legislation.

In addition, Popomaronis pointed out, there is H.R. 616, a separate bill that would exempt pharmacists from the accreditation requirement. As of Feb. 26, the bill had 97 cosponsors, and a companion bill in the Senate (S. 511) had 15.

“While [all of] this is stalled, we believe that somehow compromise is going to come,” Popomaronis said.

Noridian Finds 85% Error Rate on Oxygen Claims
FARGO, N.D.—On Thursday, Noridian Administrative Services reported the results of a prepayment review of claims for oxygen concentrators (E1390) and portable gaseous oxygen systems (E0431), and those results aren't exactly good.

Of 102 claims reviewed, the Jurisdiction D DME MAC said, 86 were denied for an overall error ratio of 85 percent.

Noridian ran the review from November through January based on the results of Comprehensive Error Rate Testing (CERT) analysis.

The DME MAC cited as the top four reasons for denial:

1) No office visit notes to determine medical necessity within 30 days of certification or 90 days within recertification were submitted (39 claims);

2) No response to medical records request (33 claims);

3) No qualifying blood gas study submitted (30 claims); and

4) Invalid Certificate of Medical Necessity (CMN) (13 claims).

(The total claim volume is more than 102 as some of the claims had multiple errors.)

Noridian noted the patient must be seen and evaluated by the treating physician within 30 days prior to the date of initial certification. For patients initially meeting Group I or II criteria, the patient must be seen and re-evaluated by the treating physician within 90 days prior to the date of any recertification. If the physician visit is not obtained within the 90-day window but the patient continues to use oxygen and the visit is obtained at a later date, coverage would resume beginning with the date of that visit.

For the DME MAC's explanation of the denial reasons, see the full notice on the Noridian Web site.

As Medicaid Enrollment Spirals Up, HME Cuts Spread
WASHINGTON—In a stark testimony to the collapsed economy, every state in the union saw an increase in Medicaid enrollment and Medicaid rolls swelled by 3.3 million in the year from June 2008 to June 2009, the largest ever, according to a new report.

"This marks the first time since the early 1990s that enrollment has grown in every state," said the analysis, released last week by the Kaiser Family Foundation's Commission on Medicaid and the Uninsured.

The report also said that June 2009 monthly Medicaid enrollment grew 7.5 percent to 46.9 million people and noted that in 32 states, enrollment in the massive program grew at least twice as fast as the year before. Most of the growth—60 percent—occurred among children, the report stated.

Analysts suggested the ballooning Medicaid numbers were likely due to the millions who lost their jobs and their employer-based health insurance.

"State Medicaid programs have been able to help millions of Americans who have nowhere else to turn in a recession," said Diane Rowland, executive vice president of the foundation and executive director of the commission. "But the states obviously face significant fiscal pressures as increases in enrollment push up costs at a time when state budgets are already severely constrained."

Home medical equipment providers in numerous states have been working to deflect devastating reimbursement cuts as state governments seek to contain their rapidly escalating Medicaid costs. The Florida Alliance of Home Care Services reported earlier this week, for example, that Florida's Medicaid program is considering requiring all beneficiaries to enroll in managed care plans as a way to cut expenses, a move that could leave HME providers out of the Medicaid picture altogether.

Members of the Midwest Association for Medical Equipment Services are fighting big cuts in several states: Kansas providers are looking at a 10 percent across-the-board cut; Missouri Medicaid announced last week that starting March 1, its new fee schedule would be 90 percent of Medicare allowables; and in Minnesota, members have been hit with a near 5 percent Medicaid cut (in addition to 19 percent cuts in BCBS reimbursement and tax audits from the state's Department of Revenue).

According to the Kaiser report, Medicaid costs in the near term are unlikely to halt their upward spiral anytime soon.

"Given historical trends in Medicaid enrollment, it is likely that enrollment will continue to rise over the next year," the report predicted. "The impact of the economic recession on children and families through job loss and the corresponding loss of health insurance is still being realized."

According to another Kaiser study that surveyed Medicaid directors, 44 states and the District of Columbia are grappling with higher enrollment than expected, and 29 states reported they were considering additional mid-year cuts in both provider rates and program benefits. The state directors said they expected a big strain on already beleaguered budgets when the federal matching money program expires Dec. 31.

For more on HME Medicaid cuts, see Maine Providers Win One, Others Continue Medicaid Battles, Feb. 5.

Q&A: The HITECH Act
The nearly $800 billion American Recovery and Reinvestment Act of 2009 made $19 billion available for health information technology through the Health Information Technology for Economic and Clinical Health Act, better known as the HITECH Act. The comprehensive stimulus package was signed into law by President Obama on February 17.

Of the $19 billion, $17 billion is set aside to pay incentives through Medicare and Medicaid to physicians and hospitals that implement and use HIT, such as electronic health records and e-prescribing by 2014. The remaining $2 billion will be distributed through the Office of the National Coordinator for Health Information Technology for a number of projects, including health information exchange infrastructure, standards evaluation and development, grants to states for the purpose of furthering EHR adoption, improvements in telemedicine delivery and the establishment of regional HIT resource centers.

According to health care attorney Jeff Baird, “The intent of the new law is clear. All providers are encouraged to take two large steps by 2014: purchase ‘certified’ EHR technology and use it in a ‘meaningful way.’ Physician and hospital providers that do not achieve this objective by the deadline will pass up available payment incentives, and all providers that do not achieve this objective by the deadline will begin incurring Medicare payment reductions.”

Q: Do the EHR requirements of the HITECH Act apply to HME suppliers?
A: Yes. The term “health care provider” is broadly defined in the Act, and the Act further indicates that it will apply to all providers that do business with the federal government.

Q: What is the purpose of the Act?
A: The Act is part of President Obama’s stimulus package. It is designed to help fulfill a promise that the president made in a speech on Jan. 8, 2009, at George Mason University. In that speech, he said: “To improve the quality of our health care while lowering its costs, we will make the immediate investments necessary to ensure that, within five years, all of America’s medical records are computerized. This will cut waste, eliminate red tape and reduce the need to repeat expensive medical tests … But it just won’t save billions of dollars and thousands of jobs; it will save lives by reducing the deadly but preventable medical errors that pervade our health-care system.”

Q: Have any regulations been proposed to implement the Act?
A: Yes. On Dec. 30, 2009, HHS released two proposed regulations that implement major provisions of the Act. The first regulation is a proposed rule that outlines an incentive program for physicians and hospitals that make meaningful use of EHR. The second is an interim final rule that establishes an initial set of standards, specifications and certification criteria for EHR. These regulations were published in the Federal Register on Jan. 13, 2010. Each regulation has a 60-day public comment period that expires at 5:00 p.m. EST on March 15, 2010.

Q: So what exactly do these two regulations say?
A: The proposed incentive program rule was issued by CMS. This rule sets out what eligible physician and hospital providers need to do to qualify for incentive payments; that is, how they can demonstrate that they are “meaningful users.” The proposed rule also addresses a number of related matters, such as the calculation and timing of payments.

The Standards, Specifications and Certification interim final rule was issued by the HHS Office of the National Coordinator for HIT and by the Secretary of HHS. The interim final rule sets out the substantive requirement that an electronic health records technology must possess in order to be considered “qualified” and thus be able to be “certified.” In other words, this regulation pertains to the capabilities that an electronic health records technology must possess to meet the requirements of the law.

Q: Does the incentive program of the HITECH Act apply to HME suppliers?
A: No. The incentive payments are limited to physicians and hospitals.

Q: If no incentives are available, why should my HME company implement EHR?
A: The Act also creates penalties or disincentives for providers that fail to utilize EHR. If providers do not become “meaningful users” of EHR by 2015, their Medicare payments will be reduced yearly in accordance with a schedule outlined in the Act. An exemption from this penalty is available if the provider can demonstrate that compliance with the requirement for being a meaningful user of EHR would result in a significant hardship.

Q: Will any additional regulations be issued?
A: Yes. HHS will issue a third regulation to define the process by which technology vendors can obtain the required certification to ensure that their EHR systems meet all the relevant standards and specifications. The certification process is expected to involve HHS accrediting third parties that can administer the certification process on a biennial basis and apply the federal requirements.

Jeffrey S. Baird, Esq., is chairman of the Health Care Group at Brown & Fortunato, P.C., a law firm based in Amarillo, Texas. He represents pharmacies, infusion companies, home medical equipment companies and other health care providers throughout the United States. Baird is Board Certified in Health Law by the Texas Board of Legal Specialization. He can be reached at 806/345-6320 or jbaird@bf-law.com.

MLN Article on Beneficiary State and ZIP Codes
BALTIMORE—CMS has released MLN Matters article MM6359 on reporting the beneficiary’s residence state and ZIP codes. The article states that claims processed on July 6, 2010, and later must include the ZIP code of the beneficiary's residence address. Read the entire MLN Matters article.

Coming Up
On the HME Calendar
AAHomecare’s Legislative Conference begins today in Washington with a Capitol Hill lobby day scheduled Wednesday. www.aahomecare.org

The Healthcare Information and Management Systems Society runs
 HIMSS 2010
 today through Thursday in Atlanta. www.himss.org

The California Association of Medical Product Suppliers (CAMPS) will hold its Annual Convention Tuesday and Wednesday in Irvine, Calif.
 www.campsone.org

The Pennsylvania Association of Medical Suppliers will hold its Conference on the Slopes in Seven Springs, Pa., Wednesday through Friday. www.pamsonline.org

The Oregon Association for Home Care (OAHC) has set its Annual Meeting March 10-12 
in Salem, Ore. www.oahc.org/

The
 26th International Seating Symposium will be held in Vancouver, B.C., March 10-13. www.interprofessional.ubc.ca/26th_Seating.htm

The
 American Pharmacists Association (APhA)
Annual Meeting and Expo 
will take place in Washington, D.C., March 12-15. 
 www.aphameeting.org/

The Health Industry Distributors Association (HIDA)
Executive Conference 
is scheduled March 15-18 in Amelia Island, Fla.
 www.hida.org/am/template.cfm?section=home

AMEPA and the Florida Alliance of Home Care Services will sponsor the Florida Home Care Conference March 18 in Orlando. www.fahcs.org

The Virginia Association of Durable Medical Equipment Companies has rescheduled its Winter Meeting to March 22-23 in Richmond, Va. www.vadmec.org/

The
 Tennessee Association for Home Care (TAHC)
 Spring Conference is set March 28-30 in Franklin, Tenn.
 www.tahc-net.org/

From the DME MACS:

Cigna Government Services Part B and DME Provider Outreach and Education teams will present their third annual joint Medicare Learning Workshops. With courses including CERT/RAC reviews, overpayment recovery, documentation requirements, medical review and provider enrollment, the all-day workshops will be offered March 31 in Concord, N.C., and April 27 in Durham, N.C. www.cignagovernmentservices.com/jc/pubs/news/2010/0210/cope11419.html.

Noridian Administrative Services begins a series of face-to-face workshops throughout Jurisdiction D. With topics including CERT, top inquiries, front-end errors and successful claim filing, the workshops begin March 23 in Long Beach, Calif., and run through June in various locations in California, Utah, Nevada, Iowa and Kansas. www.noridianmedicare.com/dme/train/workshops/face_to_face.html