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DME Suppliers, Ambulances: Prior Authorization Could Be A Positive Step

Michelle Stein, Inside Health Policy, 6/16/2014

inside news on federal health and safety regulation

May 29, 2014


DME Suppliers, Ambulances: Prior Authorization Could Be A Positive Step


              Durable medical equipment suppliers and ambulance providers say CMS’ recently announced prior authorization programs could be a step in the right direction for fighting fraud while preserving access, although they have some concerns about the DME prior authorization timelines.

If prior authorization for some DME is handled correctly, it could solve a lot of issues in the sector, according to American Association for Homecare Vice President for Regulatory Affairs Kim Brummett. Brummett said she hopes that CMS will work with the industry on the proposed DME prior authorization process as the agency did on the power mobility device demonstration.

CMS late last week announced it would expand the power wheelchair prior authorization demonstration, which was launched in 2012, to 12 more states. Despite initial industry concerns, both CMS and some DME suppliers have characterized the demonstration as a success, and the agency said it plans to build off the success by testing prior authorization for scheduled ambulance transport and hyperbaric oxygen therapy. It also proposed a prior authorization process for certain DME, and the agency says the proposed rule is estimated to reduce Medicare spending by $100 million to $740 million over the next 10 years.


Brummett said that expanding the power mobility device demonstration is something that we’ve wanted for a

long while. It sets the right balance making sure that devices are covered and fraud prevention, she said. 

              Cynthia Morton, executive vice president at the National Association for the Support of Long Term Care, said that while the group plans to keep a close eye on the proposed prior authorization for some DME and how it would practically work, from an appeals standpoint prior authorization could be beneficial and a step in the right direction. The agency has proposed that unlimited resubmissions be allowed if prior authorization is denied, but a decision cannot be appealed, the proposed rule says.

Brummett said AAHomecare is still reviewing the rule, but she hopes that CMS will work with the industry on the proposed DME prior authorization process as it did on the power mobility device demonstration. The proposed rule seeks feedback on setting the DME prior authorization process and creating the “Master List” of items that could be subject to prior authorization.

CMS says decisions on initial requests would be postmarked within 10 business days and subsequent requests would be processed within 20 business days. CMS also has proposed an expedited review process.


Brummett said the timeframe for prior authorization should depend on the type of DME. Most DME is ordered after a hospital discharge or when there is an immediate need, and the beneficiaries don’t have days to wait for prior authorization, she said. Most private payers pre-approve DME within hours, and for some DME, CMS will need to be that fast as well, she said. Morton also said that there will be concerns if the way the DME prior authorization process is done slows patient access to the DME. When the government intends to do something quickly but it doesn’t happen that way, it can be hard to change an established process, she said. Morton pointed to issues with the therapy manual medical review process, which was also supposed to have a 10-day review time. NASL released a survey in December that showed at least 33percent of MMR claims submitted by members since the beginning 2013 were still waiting to be processed. The hope is that delays won’t accumulate with this program, Morton said.

Brummett also said that there should be a way to measure the prior approval process and ensure consistency across the process. Language should also be included in the rule to say that if prior authorization is approved, then no post-pay review for medical necessity should be conducted, she added.


Tristan North, senior vice president of government affairs at the American Ambulance Association, said the group is supportive of the prior authorization policy laid out by CMS. The group had previously discussed with CMS using prior authorization for addressing dialysis transportation fraud, North said, as the group has seen Congress try to address the issue by cutting reimbursement for ambulance transport in previous physician payment patches. Cuts are not enough of a disincentive for fraudulent providers who are still making money, but they hurt legitimate providers, North said. This policy is viable if it is implemented properly and there are safeguards on turn around time so that prior authorization is approved in a timely manner, North added.

CMS says a prior authorization decision could affirm a specific number of trips, and CMS may approve up to 40 round trips per prior authorization request in a 60-day period.

The prior authorization demonstration for scheduled ambulance transports will affect New Jersey, Pennsylvania and South Carolina, and North noted that CMS had previously instituted a moratorium on ambulance providers in the Philadelphia area. That helps keep bad actors out of the program, but layering prior authorization on top of the moratorium is a good option stop those still in the system, North said. — Michelle M. Stein (


Copyright 2014 Inside Washington Publishers. Reprinted with permission.