Drug bill requires providers to become accredited

Wednesday, December 31, 2003

WASHINGTON - Congress has raised the barrier of entry to the realm of Medicare’s dollars by calling for a new set of quality standards for HME suppliers and for one or more “recognized independent accreditation organizations” to act as gatekeeper.

The provision will take effect one year after the secretary of the Department of Health and Human Services implements the quality standards, which have yet to be established.

The Medicare Prescription Drug Act specifies no deadline for the establishment of those standards, but industry sources believe the standards will be set in the next year or two, and at the latest, before competitive bidding gets underway in 2007.

Currently, Congress requires that Medicare’s HME suppliers follow 21 supplier standards that providers routinely characterize as toothless.

One reason CMS devotes so little to gatekeeping is money. While private insurers spend as much as 10% on administrative costs, CMS is a relative skinflint, expending less than 1% of its budget on such functions.

The new legislative language is short on specifics when it comes to the new standards. The act does require the secretary of Health and Human Services to consult with “relevant parties” as the agency formulates the standards. But just how rigorous they’ll be is an open question.

“I’m hoping that they’re not just embellishments on the 21 standards,” said Dave Williams, who recently retired as Invacare’s director of government relations. “They are so ambiguous and almost inconsequential to patient outcomes.”

Some believe the standards will mirror the rigorous guidelines set by the nation’s three organizations that do nearly all of the accrediting for the HME industry: ACHC (Accreditation Commision for Health Care) in Raleigh, N.C., CHAP (Community Health Accreditation Program) in New York and JCAHO (Joint Commission on Accreditation of Healthcare Organizations) in Oakbrook, Ill.

The rationale for that speculation comes from an appreciation of Medicare’s standards for home health agencies. In a crosswalk comparison of Medicare’s home health standards and ACHC’s home health standards, which incorporate Medicare’s COPs (conditions of participation standards), ACHC President Tom Cesar does not see the same great gulf of differences that separate his organization’s standards from Medicare’s existing supplier standards for DME.

At ACHC, an HME provider must fulfill standards detailed in 68 pages and eight chapters that range over such topics as Client Service & Care Management and Quality Outcomes Improvement.

Cesar already has written to DHHS Secretary Tommy Thompson, asking for a place at the table where the standards will be codified.

Although an HME NewsPoll in July found that 49% of 115 HME industry respondents opposed mandatory accreditation, today, in an otherwise stunning blow to the HME industry, accreditation is seen as the only bright light for HME in the Medicare Drug Act.