CMS Major Proposed Rule: Face-to-Face Encounters as a Condition for Payment

Attached below is an Advance copy of a CMS Federal Register notice announcing a proposed rule that would impact the DME industry.  Specifically, the proposed rule’s provisions include implementation of “provisions of the Affordable Care Act by establishing a face-to-face encounter as a condition of payment for certain durable medical equipment (DME) items.”

CMS’ Summary of the proposed rule states:

This major proposed rule addresses changes to the physician fee schedule, payments for Part B drugs, and other Medicare Part B payment policies to ensure that our payment systems are updated to reflect changes in medical practice and the relative value of services. It would also implement provisions of the Affordable Care Act by establishing a face-to-face encounter as a condition of payment for certain durable medical equipment (DME) items. In addition, it would implement statutory changes regarding the termination of non-random prepayment review under the Medicare Prescription Drug, Improvement, and Modernization Act of 2003. Finally, this proposed rule also includes a discussion regarding the Chiropractic Services Demonstration program.

With respect to DME, CMS is:

proposing to require that the face-to-face encounter occur no earlier than 90 days prior to each written order for a covered item of DME or within 30 days after the order is written. This proposal is consistent with the Medicare and Medicaid home health face-to-face requirement which increases physician accountability and specifies a timeframe within the discretion of the Secretary.

CMS also states that

We estimate, as discussed below in this section, that the PFS [Physician Fee Schedule] provisions included in this proposed rule will redistribute more than $100 million in 1 year. Therefore, we estimate that this rulemaking is “economically significant” as measured by the $100 million threshold, and hence also a major rule under the Congressional Review Act. Accordingly, we have prepared a RIA that, to the best of our ability, presents the costs and benefits of the rulemaking. The RFA requires agencies to analyze options for regulatory relief of small entities. For purposes of the RFA, small entities include small businesses, nonprofit organizations, and small governmental jurisdictions. Most hospitals and most other providers and suppliers are small entities, either by nonprofit status or by having revenues of $7.0 million to $34.5 million in any 1 year (for details see the SBA’s Website at http://www.sba.gov/content/table-small-business-size-standards (refer to the 620000 series)).

With respect to the RFA, CMS further notes that:

The RFA requires that we analyze regulatory options for small businesses and other entities. We prepare a regulatory flexibility analysis unless we certify that a rule would not have a significant economic impact on a substantial number of small entities. The analysis must include a justification concerning the reason action is being taken, the kinds and number of small entities the rule affects, and an explanation of any meaningful options that achieve the objectives with less significant adverse economic impact on the small entities.

For additional discussion of the RFA and other regulatory requirements, please see the proposed rule attached below.

Comments on the proposed rule are due 60 days after the proposed rule is published in the Federal Register.

CMS Proposed Rule.RIN 0938-AR11.AdvanceFR