The waiting game: HCFA's license requirement
The waiting game: HCFA’s license requirement
Lawsuit dismissed, provider waits to appeal claim
Many home infusion providers who already possessed a pharmacy license thought that the Health Care Financing Administration’s (HCFA) decision to allow only entities with a pharmacy license to supply or bill for medications used with durable medical equipment (DME) or prosthetic devices would lead to increased business. (See Home Infusion Therapy Management, October 1996, p. 109.)
But the policy doesn’t appear to be etched in stone just yet, particularly if those still opposed to the policy get their way.
Prior to the Dec. 1 implementation date of HCFA’s policy, Van G. Miller & Associates, a Waterloo, Iowa-based buying group that negotiates contracts with major home medical equipment (HME) manufacturers for independent HME dealers, filed a lawsuit against HCFA requesting a restraining order to prevent the implementation.
The legal battle was short-lived, however, as the judge in the case ruled that Van G. Miller "should have gone through the administrative procedures regarding a Medicare denial," says Jim Walsh, JD, general counsel, Van G. Miller & Associates. But because the policy had not yet taken effect, there were no denials to appeal and there still are none.
"We still can’t get a clean denial," laments Walsh, noting that to appeal it needs Medicare to refuse to pay based solely on the fact that an HME dealer who provided the equipment was not a pharmacist.
The National Association for Medical Equipment Services (NAMES) is running into a similar problem if a lack of problems can be called that. NAMES has been meeting with HCFA regarding the policy but has had no luck getting the agency to change the policy.
"HCFA’s response is, if we can show them that there have been any problems in the industry, they’ll consider something," says Steve Haracznak, vice president of communication, NAMES in Alexandria, VA. "But we’re getting very few, if any complaints, from members. It’s hard for us to complain about the policy when we’re not having any problems in the industry."
Haracznak says that the lack of problems may be due to the fact that providers who had just a handful of patients affected by the new policy switched those patients to other providers. And those that had a large number of such patients have already made agreements with pharmacies to supply the medications.
Does the policy have a chance to be overturned? No one can be sure because much of the controversy between the industry and HCFA is mired in confusion and semantics.
"The fact is that a lot of states have no problem with an infusion company contracting with a licensed pharmacy to deliver the pharmaceuticals that way, and I think HCFA’s presumption was that any entity doing that was in violation of state pharmacy laws," notes Joan Polacheck, JD, McDermott, Will & Emery, Chicago.
In her past discussions with pharmacy regulators in Illinois, Polacheck found that to be the case.
"They would say as long as the licensed pharmacy fills the prescription, then the nurse delivers it to the home, and that might be considered dispensing, but it’s really a billing issue," she says. "As long as all the middleman is doing is the billing, and the pharmacy is filling the prescription and doing the dispensing, they found that OK. I’m not aware of state regulators taking action against infusion companies that operated that way."
In fact, Polacheck feels it’s not a "clear legal issue," which she says explains why many businesses were operating in a fashion that is no longer allowed by HCFA.
"They believed it was a legitimate way to do business," she says.
Until HCFA issued the pharmacy license requirement, it appeared that was the case.
"No one has ever been prosecuted for this, so it’s hard to believe it’s illegal," says Walsh.
Walsh notes that his group must be selective on how it approaches HCFA. In fact, it may not be wise for the group to pursue the first clean denial relating to the lack of a pharmacy license.
"I would prefer to get a clean denial in a state that has an opinion from a pharmacy board or the state court system in some respect that says it’s perfectly permissible for a DME to handle the billing as has been done in the past," he says. "The problem is there are very few that have ever come out and addressed the question. So when you get right down to it, we might have to seek a state law ruling, too."
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