DME Industry 2021 Year End Review & Looking Into 2022

Many DME providers have had tremendous hurdles to overcome this year, from the implementation of a new round of Medicare’s Competitive Bidding Program through continued impacts of COVID-19. Mergers and acquisitions are through the roof as a result, as are continued compliance concerns that plague the industry.

Let’s dive into some of the major DME related matters & issues that have come across my desk this year, and what to be on the lookout for in the next.

Competitive Bidding Impacts

After much uncertainty about what DME products would actually be included upon its implementation, Round 2021 of Medicare’s Competitive Bidding Program (“CBP”) kicked off at the beginning of this year.

With off-the-shelf knee and lumbar braces (HCPCS Code OR03) included in Round 2021 of the CBP – and thus ability to supply such devices to beneficiaries in competitive bid areas restricted to bid-winners – non bid-winning DME providers have been scrambling to find new revenue streams to fill the void. Unfortunately, many are doing so in a non-compliant manner.Continue reading

Genetic Testing: Be Hopeful but Wary

Genetic tests are valuable because they can provide important information to patients and their medical providers regarding diagnoses, treatment, and disease prevention. However, the rapid growth in the number of tests ordered, especially in light of the telemedicine expansion during the pandemic, has invited well-earned scrutiny to the industry.

Make no mistake: genetic testing is heavily regulated (and enforced). The Federal Anti-Kickback Statute, Eliminating Kickbacks in Recovery Act, and Commercial Insurance Fraud Law have all been used to prosecute unscrupulous marketers, call centers, and telemedicine providers in the last few months. Kickbacks in exchange for genetic specimens are just as illegal as kickbacks for patients. Three months ago, a Florida man was sentenced to 10 years in prison for conspiracy to commit health care fraud. His actions resulted in the submission of approximately $3.3 million in fraudulent claims to Medicare for genetic testing.Continue reading

Healthcare Marketing: Measure Twice, Cut Once

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fhlf healthcare marketingBy: Jeff Cohen

Wanna know how often we’re asked whether the laws re healthcare marketing are really enforced?  How often we hear “Everyone is doing it.”  “Surely they [regulators] understand that every healthcare business has to market its services and item,” we’re told.  And when we start to educate people re the state and federal laws that pertain to marketing healthcare items and services (INCLUDING those for which payment isn’t made by a state or federal healthcare program), their impatience and intolerance is palpable.

Take a look at the latest report from the Department of Justice guilty plea from someone who marketed the services of a genetic testing lab.  He admitted being guilty of receiving over $300K in kickback money (presumably in the form of marketing fees) and now faces (1) a $250K fine, (2) returning all the money he received, and (3) five years in prison!

Marketing any healthcare service or item is at the tip of the sword in terms of regulatory investigation and enforcement.  It’s that simple.  And so when your lawyers drag you through laws like the Anti-Kickback Statute, the Florida Patient Brokering Act, the federal health insurance fraud law, the bona fide employee exception, the personal services arrangement and management contract safe harbor and EKRA, thank them!  And expect nothing less.  If you do ANYTHING at all in the neighborhood of marketing a healthcare item or services, the first place to start is:  meet with a very experienced healthcare lawyer who is not learning on your dime.  And have them take a couple hours to educate you about the laws, the options and the risks of each one.  And once you’ve done that, ask them what more you can do to reduce your risk, for instance—Continue reading

Forward Looking: How to Prepare for 2021

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We’ve all learned a lot in 2020, but are we prepared for what 2021 will bring? The change of the calendar won’t make the pandemic go away, but you can prepare your medical practice.

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EKRA and SUPPORT Act Impact: Legal Breakdown

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By: Susan St. John

Most everyone knows that laws are being implementing in federal and state government to address the opioid crisis in the US. One such law is the Substance Use Disorder Prevention that Promotes Opioid Recovery and Treatment for Patients and Communities Act (“SUPPORT Act”) signed into law in October 2018 by President Trump. While the SUPPORT Act seeks to increase access to treatment for substance use disorders and prevention of substance use disorders, it also contains language to prevent abuse of the process to increase treatment access. Specifically, incorporated into the SUPPORT Act is the Eliminating Kickbacks in Recovery Act (“EKRA”) which directly targets unlawful referrals to recovery homes, clinical treatment facilities, and laboratories.

EKRA is similar to prohibited kickbacks and patient brokering pursuant to Sections 456.054 and 817.505, Florida Statutes, using similar language as both Florida statutes. EKRA makes it unlawful…Continue reading

EKRA Affects Marketing Relationships with Labs and Addiction Treatment Businesses

By: Jeff Cohen

For those following the federal legislative developments on the issue of compensating marketing people who market the services of labs and addiction treatment facilities there is a new update to take note of. Congress passed on October 24, 2018 the “Substance Use-Disorder Prevention that Promotes Opioid Recovery and Treatment for Patients and Communities Act.”  Yes, that’s a real name!  Part of the law is the Eliminating Kickbacks in Recovery Act of 2018 (“EKRA”).

The core aspect of EKRA has to do with how to properly compensate marketing personnel who market the services of labs, addiction treatment facilities and recovery homes.   For those of you already familiar with existing federal law pertaining to compensation arrangements (e.g. the bona fide employee exception (the “BFE”) and the personal services arrangement and management contract safe harbor (the “PSA”)), the EKRA provisions will look familiar!  Key aspects of this law (which has to be read together with similar existing laws) include—Continue reading

Time out! Keeping Healthcare Lead Generation in Check

healthcare lead generation

healthcare lead generationBy: Michael Silverman

There are perfectly compliant ways to engage with healthcare marketers, and then there’s this; here are some of the latest real-life examples:

“DME BRACE CAMPAIGN – $40 to $150 PER LEAD PER BRACE”

“DME DIABETIC LEADS $40 PER LEAD, INSURANCE AND DOC INFO INCLUDED”

“PAIN CREAM/LIDOCANE LEADS FOR SALE, RX INCLUDED”

These marketers are seemingly holding auctions for the sale of federally protected patient health information out to the highest bidder! Couldn’t make this stuff up – if you’re in this industry, a quick gander at your (business) social media platforms will quickly confirm it.Continue reading

Marketing for DME & Pharmacy Providers: Know Your Subcontractor!

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marketing for dmeBy: Michael Silverman

Regulatory compliance is a mandatory investment for any healthcare business owner looking to stay out of serious and personal legal peril, let alone one hoping to keep their company viable.

Yet there is seemingly an onslaught of providers that blatantly run afoul of many of these regulations, knowingly or not, or those that believe they may have found a loophole.

Concerning the latter, there is an important mantra that such DME and pharmacy providers should remember and live by: “[W]hat a provider cannot do directly, it cannot do indirectly through an intermediary.”

Marketing for DME – What exactly am I talking about?

DME providers enrolled with CMS (should) know they cannot solicit or ‘cold call’ Medicare Part B beneficiaries, per the Federal Anti-Solicitation Statute, and that they cannot offer anything of value to a potential patient that could induce them to utilize them as a provider, in accordance with the Beneficiary Inducement Statute.Continue reading

Pharmacy Billing Basics: Know Your Payor!

pharmacy billing

pharmacy billingBy: Michael Silverman

In giving consideration to whether healthcare regulations apply to a proposed course of conduct it’s absolutely vital for a pharmacy to know its payor! This is especially so in the context of patient marketing and the various regulatory prohibitions on paying for healthcare referrals. Unfortunately, some pharmacy owners remain a bit mixed up about who the ultimate payor is for the medications they dispense, and, depending on that pharmacy’s billing operations, such mistakes can have devastating consequences.

A large part of this confusion might be attributed to the fact that in most instances, a pharmacy is not billing the ultimate payor directly (unlike a DMEPOS provider that may be directly submitting claims to Medicare Part B), but rather, the pharmacy is billing an intermediary entity called a Pharmacy Benefit Manager (“PBM”), which is usually a commercially run entity (non-government owned) that manages and adjudicates claims on behalf of health insurance plans that cover pharmacy benefits.Continue reading

Anti-Kickback Statute and Healthcare Marketing: 3 Legal Considerations

healthcare marketing

healthcare marketingBy: Matt Fischer

Healthcare marketing arrangements that violate the Anti-Kickback Statute (AKS) can lead to serious financial and criminal consequences.  Understanding the types of marketing arrangements that courts have found to be in violation of the statute and the potential implications are critical for marketers to know in order to operate in the healthcare industry.

Under the AKS, it is a criminal offense to knowingly and willfully offer, pay, solicit, or receive any remuneration to induce referrals of items or services reimbursable by the Federal health care programs.  Where remuneration is paid purposefully to induce referrals of items or services paid for by a Federal health care program, the AKS is violated.  By its terms, the AKS ascribes criminal liability to parties on both sides of an impermissible transaction.  An example of a highly scrutinized arrangement involves percentage compensation.  For regulators, percentage compensation arrangements provide financial incentives that may encourage overutilization and increase program costs.

Here are 3 important things to know:Continue reading