February 9, 2010

Consignment Closet Rule Rescinded

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AAHomecare has reported that the Centers for Medicare and Medicaid Services (CMS) has rescinded the “consignment closet” rule, scheduled to take effect in March, to allow for “further review and consideration” of the rule. The current rules governing consignment closets under Medicare are still in place.

According to AAHomecare, the rescinded rule would have “essentially prohibited arrangements where an enrolled supplier of durable medical equipment, prosthetics, orthotics, and supplies (DMEPOS) maintains inventory at a practice location which is not owned by the enrolled DMEPOS supplier, but by the physician, non-physician practitioner, or other healthcare professional. The rescinded rule would have required physicians and non-physician practitioners to take possession of DMEPOS items, who then would have had to bill for the equipment using their own supplier billing number. In addition to being impractical for physicians and Medicare beneficiaries, such an arrangement would have likely violated the physician ownership and referral statute—known as the Stark law.” AAHomecare has stated that it worked with CMS to rescind the rule because it “would have created serious disruptions in services for Medicare beneficiaries.”

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