AMARILLO, TX – Most Medtrade Monday articles address one legal topic or several topics that are related to each other. This week’s article is different. In this article, we will discuss two topics that are unrelated…but that are important to DME suppliers.
Philips Recall and HIPAA
DME suppliers are being asked to upload data to Philips pertaining to patients who have purchased Philips CPAPs, BiPAPs, and ventilators from the suppliers. This raises the issue regarding such disclosure of protected health information (“PHI”) requires a HIPAA authorization from the patients. HIPAA regulations indicate that an authorization is not required.
45 CFR §164.512 states, in relevant part:
- 164.512 Uses and disclosures for which an authorization or opportunity to agree or object is not required.
(b) Standard: uses and disclosures for public health activities. (1) Permitted disclosures. A covered entity may disclose protected health information for the public health activities and purposes described in this paragraph to:
(iii) A person subject to the jurisdiction of the Food and Drug Administration (FDA) with respect to an FDA-regulated product or activity for which that person has responsibility, for the purpose of activities related to the quality, safety or effectiveness of such FDA-regulated product or activity. Such purposes include:
(A) To collect or report adverse events (or similar activities with respect to food or dietary supplements), product defects or problems (including problems with the use or labeling of a product), or biological product deviations;
(B) To track FDA-regulated products;
(C) To enable product recalls, repairs, or replacement, or lookback (including locating and notifying individuals who have received products that have been recalled, withdrawn, or are the subject of lookback); or
(D) To conduct post marketing surveillance;
Participating vs. Non-Participating
A DME supplier that desires to retain its ability to bill and collect its usual and customary charge directly from the beneficiary and not be limited by the Medicare Durable Medical Equipment, Prosthetics, Orthotic, and Supplies (“DMEPOS”) fee schedule should elect to be a non-participating supplier.
At initial enrollment in Medicare, physicians and suppliers, including DME suppliers, must choose whether to enroll as participating (“Par”) or non-participating (“Non-Par”). Par suppliers sign an agreement with Medicare to accept assignment for all Medicare claims beginning January 1 of each year. When a DME supplier accepts assignment, it is bound to accept the DME Medicare Administrative Contractor’s approved amount as payment in full and may only collect from the beneficiary any coinsurance (i.e., 20 percent of the Medicare allowed amount), applicable deductible, and payment for non-covered items. Non-Par suppliers may choose to bill a claim as assigned or non-assigned on a claim-by-claim basis. A supplier may change its status as Par or Non-Par for the following year during an annual open enrollment period which typically occurs from mid-November through December 31.
There are limited advantages for a Par physician or supplier. A Par physician receives a fee schedule amount that is five percent higher than a Non-Par physician. However, no similar increase in fee schedule payment is available to a DME supplier that elects to enroll as Par. Medicare also includes Par physicians and suppliers in an online directory. In addition, claim payment information is automatically forwarded to supplemental insurers for Par suppliers.
On the other hand, there is a potential financial advantage for a Non-Par DME supplier. As previously mentioned, a Non-Par DME supplier may choose to bill a claim as assigned or non-assigned on a claim-by-claim basis. For non-assigned claims, the Non-Par DME supplier is not limited to the Medicare DMEPOS fee schedule and may charge and collect its usual and customary charge for the item directly from the beneficiary. For non-assigned claims, Medicare makes payment to the beneficiary and not the supplier.
Regardless of whether the claim is assigned or non-assigned, the same Medicare documentation requirements apply; and all claims are subject to audits and denials. If a claim is audited, the DME supplier is responsible for responding to the audit with supporting documentation. Also, the requirements for Advance Beneficiary Notices are applicable to both assigned and non-assigned claims.
HME Business Webinar
Offering Value-Added Services to Customers While Avoiding Prohibited Inducements
Presented by: Jeffrey S. Baird, Esq., Brown & Fortunato
Thursday, July 29, 2021
1:00-2:00 p.m. CENTRAL TIME
DME suppliers can find themselves walking a legal tightrope: An important way to set themselves apart from their competitors is to offer services to existing and prospective patients — services that other suppliers cannot offer. Moreover, with the recent relaxation of the federal anti-kickback statute (AKS), the federal physician self-referral statute (Stark), and the federal beneficiary inducement statute, CMS and the OIG are encouraging the provision of value-added services to patients.
However, at the same time, it is important that DME suppliers not go so far that they inadvertently violate these statutes. And that is exactly where they must strike the right balance between adding value while avoiding inducements. This webinar will discuss the federal laws governing value-added services to patients; those value-added services that are legally acceptable; and those value-added services that may trigger a government enforcement action.
During this presentation, attendees will:
- Learn about the federal laws that govern value-added services that DME suppliers can offer to existing and prospective patients.
- Hear about value-added services that are legally acceptable.
- Understand those value-added services that may trigger a government enforcement action.
Jeffrey S. Baird, JD, is chairman of the Health Care Group at Brown & Fortunato, a law firm with a national health care practice based in Texas. He represents pharmacies, infusion companies, HME companies, manufacturers, and other health care providers throughout the United States. Baird is Board Certified in Health Law by the Texas Board of Legal Specialization and can be reached at (806) 345-6320 or firstname.lastname@example.org.