Update

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Thursday, January 31, 2002

MUNDELEIN, Ill. - Medline has teamed up with COSTA MESA, Calif. - Apria's re-entry into the medical supplies business via a catalog and the Internet, as well as its decision not to take assignment, is cause for concern for at least one DMERC official, who believes it's high time Medicare had guidelines in place for e-commerce.

"You can't ignore an 800-pound gorilla," said the official, who asked that his name not be used. "We can see more of this coming. We can hear the stampede in the distance. We have to decide whether we're going to let them run us over or whether we're going to deal with this. Now."

Indeed, HME providers say if Apria can pull off being a one-stop shop by providing DME and taking assignment through Apria and providing medical supplies without dirtying its hands with inventory and billing through a subsidiary, Apria Homecare Essentials, LLC, others will follow suit.

The DMERC official said Apria's new business strategy is problematic because when providers do business over the Internet and/or they don't take assignment, the long arm of Medicare has trouble reaching them.

"Typically, when you're dealing with a Web-based, call center operation, there's no equipment anywhere, no company trucks making deliveries," he said. "How do you make sure it's legit?"

At least Apria Homecare Essentials, LLC, has a physical location because of its parent company, he said.

But numerous providers, including Walgreen's, are concerned with the subsidiary, the DMERC official said. They say although not taking assignment precludes it from filing claims, Apria's still dealing with the Medicare population. They wonder how an 80-year-old woman looking to buy ostomy supplies, who does reimbursable business with Apria for other supplies, will know the difference.

"Those are still our people," he said.

A call to Apria Homecare Essentials, LLC, revealed that customer reps make callers aware that the subsidiary does not take assignment and that they will need a credit card to place an order. They also give callers the phone number of their local Apria provider. A call to a Massachusetts Apria provider revealed that reps there tell callers they haven't sold medical supplies for a handful of years and direct them to the Homecare Essentials catalog or the Apria Web site.

Apria officials declined to comment for this story.

One provider said he believes Apria's testing its subsidiary in only a few places in each DMERC region to see how it's received, not only by customers but also by Medicare. If they went nationwide from the get go, he said it'd sink. HME

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