Service: CMS keeps providers in dark

Friday, February 29, 2008

It makes perfect sense. Once the cap rental period ends and a Medicare beneficiary assumes ownership of a piece of DME, he naturally might want to sign a service agreement with his provider to maintain the equipment.
Not so fast, say industry attorneys. It may make perfect sense--much like an extended warranty for a kitchen appliance--but CMS has yet to release details on how to structure such an agreement, and it's best to hold off until it does.
"There is not much written guidance out there right now that talks about life after the transfer of title," said Jeff Baird, a healthcare attorney with Brown & Fortunato in Amarillo, Texas. "I believe we can do it, but I'm uncertain what the rules will be."
Lacking that guidance, some providers say they are servicing patient-owned equipment for free. (See related story, page 17).
Service agreements are easy to structure, but CMS must spell out what is and is not acceptable, said attorney Neil Caesar, president of the Health Law Center in Greenville, S.C. For example, can it be signed at the initial set up or not until the 11th, 12th or 13th month? Can a provider offer a discount to beneficiaries who sign the agreement and pay at the earliest possible date? What exactly will the agreement cover, and how much can the provider charge for the services? Will beneficiaries pay monthly, quarterly or annually?
"This is rarely a complicated document, though it has to be sensitive to CMS's rules, which often get left to the last minute to be communicated to providers," Caesar said.