PNHP

CMS requirements for medical suppliers – a bureaucratic boondoggle?

Change in law costs medical supply firms

By Karen Shideler
The Wichita Eagle
January 8, 2009
Businesses that provide durable medical equipment, such as hospital beds and bottled oxygen, are being hit by more paperwork and new costs because of new federal requirements.
The Centers for Medicare and Medicaid Services are requiring most durable medical equipment suppliers to post a surety bond of $50,000 and to be accredited.
The federal requirements are, in part, the result of efforts to fight Medicare fraud and abuse. Medicare recently announced that it was revoking billing privileges of more than 1,100 medical equipment suppliers in south Florida and the Los Angeles area after an investigation found about $1 billion in improper payments.
In a news release, CMS acting administrator Kerry Weems said, “We know the majority of medical equipment suppliers and health care providers want to improve the health of Medicare beneficiaries, but we also know there are those who look for any opportunity to take advantage of beneficiaries and Medicare.”
“It’s more work and, let’s face it, it’s money out of our pocket,” said Leon Deaver, owner of Kimzey-Eilert Medical Supplies.
Bruce Schneider, owner and pharmacist at Hart Pharmacy & Home Medical Equipment, estimated the new requirements will cost him $20,000.
Brian Dechant, director of sales at Therapeutic Medical Supply, said the accreditation requirement doubles or triples the amount of paperwork required.
“If you’re running your operations like you should be, it’s not a real big thing,” Dechant said. He said his company was recently accredited for a three-year period. “It requires you to follow a certain set of standards… They review them, make sure everything’s kosher, then they actually look at our processes.”
Schneider said he has seen estimates that 28 percent of medical equipment suppliers nationwide could be out of business a year from now because of the new requirements.
But he and Dechant both said they expected the number in Wichita to hold steady. “We’re generally honest, good people,” Dechant said.
He, Schneider and Deaver all said the new requirements aren’t all bad.
For Schneider, they’ve resulted in some streamlining.
Deaver said they should help assure customers, too.
“We’re taking a very positive attitude, that it will help us do things better,” he said.
http://www.kansas.com/business/health-care/story/655455.html

A frequent complaint about government financing of health care is that government bureaucrats place an excessive administrative burden on the health care delivery system. This charge has already been refuted by studies demonstrating the much greater administrative excesses and waste of the private insurance industry when contrasted with a public program such as Medicare.
Nevertheless, when the government introduces a program to improve value in health care purchasing, such as this program to accredit medical equipment suppliers, howls of protest arise from the anti-government forces. This article on “more paperwork and new costs because of new federal requirements” provides these protesters with more support. Or does it?
It is only natural that honest businessmen who are trying to provide quality products and services would be annoyed with new government requirements. But they understand that the taxpayers should not be expected to pay a billion dollars to crooks that permeate their own industry. They also admit that these new requirements “aren’t all bad,” that they have motivated “some streamlining,” and that they will help “assure customers” of the integrity of this industry that has been given a black eye by the the nefarious element amongst them.
How would the private insurance industry have handled this? Would they have used their very large pool of administrative funds to require accreditation and surety bonds of the suppliers? No. They use their administrative funds to write and market innovative plans that don’t even cover these supplies and services. When they do provide this coverage with premium plans, they burn up more administrative dollars to be sure that they sell these more comprehensive plans only to those healthy individuals who would be less likely to need these benefits. An obvious irony is that these administrative costs for the private insurers are much greater than would be a program of accreditation and surety bonds.
Never fear. As with other Medicare administrative efficiencies, the private insurers will get a free ride by using the Medicare lists of accredited suppliers. Once again, the taxpayer foots the bill, while the private insurers take their spoils to the bank.

CMS requirements for medical suppliers – a bureaucratic boondoggle?

Change in law costs medical supply firms

By Karen Shideler
The Wichita Eagle
January 8, 2009

Businesses that provide durable medical equipment, such as hospital beds and bottled oxygen, are being hit by more paperwork and new costs because of new federal requirements.

The Centers for Medicare and Medicaid Services are requiring most durable medical equipment suppliers to post a surety bond of $50,000 and to be accredited.

The federal requirements are, in part, the result of efforts to fight Medicare fraud and abuse. Medicare recently announced that it was revoking billing privileges of more than 1,100 medical equipment suppliers in south Florida and the Los Angeles area after an investigation found about $1 billion in improper payments.

In a news release, CMS acting administrator Kerry Weems said, “We know the majority of medical equipment suppliers and health care providers want to improve the health of Medicare beneficiaries, but we also know there are those who look for any opportunity to take advantage of beneficiaries and Medicare.”

“It’s more work and, let’s face it, it’s money out of our pocket,” said Leon Deaver, owner of Kimzey-Eilert Medical Supplies.

Bruce Schneider, owner and pharmacist at Hart Pharmacy & Home Medical Equipment, estimated the new requirements will cost him $20,000.

Brian Dechant, director of sales at Therapeutic Medical Supply, said the accreditation requirement doubles or triples the amount of paperwork required.

“If you’re running your operations like you should be, it’s not a real big thing,” Dechant said. He said his company was recently accredited for a three-year period. “It requires you to follow a certain set of standards… They review them, make sure everything’s kosher, then they actually look at our processes.”

Schneider said he has seen estimates that 28 percent of medical equipment suppliers nationwide could be out of business a year from now because of the new requirements.

But he and Dechant both said they expected the number in Wichita to hold steady. “We’re generally honest, good people,” Dechant said.

He, Schneider and Deaver all said the new requirements aren’t all bad.

For Schneider, they’ve resulted in some streamlining.

Deaver said they should help assure customers, too.

“We’re taking a very positive attitude, that it will help us do things better,” he said.

http://www.kansas.com/business/health-care/story/655455.html

Comment:

By Don McCanne, MD

A frequent complaint about government financing of health care is that government bureaucrats place an excessive administrative burden on the health care delivery system. This charge has already been refuted by studies demonstrating the much greater administrative excesses and waste of the private insurance industry when contrasted with a public program such as Medicare.

Nevertheless, when the government introduces a program to improve value in health care purchasing, such as this program to accredit medical equipment suppliers, howls of protest arise from the anti-government forces. This article on “more paperwork and new costs because of new federal requirements” provides these protesters with more support. Or does it?

It is only natural that honest businessmen who are trying to provide quality products and services would be annoyed with new government requirements. But they understand that the taxpayers should not be expected to pay a billion dollars to crooks that permeate their own industry. They also admit that these new requirements “aren’t all bad,” that they have motivated “some streamlining,” and that they will help “assure customers” of the integrity of this industry that has been given a black eye by the the nefarious element amongst them.

How would the private insurance industry have handled this? Would they have used their very large pool of administrative funds to require accreditation and surety bonds of the suppliers? No. They use their administrative funds to write and market innovative plans that don’t even cover these supplies and services. When they do provide this coverage with premium plans, they burn up more administrative dollars to be sure that they sell these more comprehensive plans only to those healthy individuals who would be less likely to need these benefits. An obvious irony is that these administrative costs for the private insurers are much greater than would be a program of accreditation and surety bonds.

Never fear. As with other Medicare administrative efficiencies, the private insurers will get a free ride by using the Medicare lists of accredited suppliers. Once again, the taxpayer foots the bill, while the private insurers take their spoils to the bank.