While the path each state takes toward licensure of HME providers is unique, the reasons behind the desire for licensure and the challenges the legislative process imposes are common to all. When Rich Pozesky, president/executive director of the Nevada Association of Medical Products Suppliers (NAMPS), helped get Nevada providers licensed by the state, he wrote Dealer/Provider about the process. We are pleased to offer his account of the long road to licensure.

The Nevada Association of Medical Products Suppliers (NAMPS) was founded in 1993. During the incorporation, some of the founders wanted to pursue licensure for our industry. We asked the business owners and managers who joined NAMPS for their opinion on licensure. Their general consensus was that there already were enough regulations, why put more on ourselves.

Little did we want to admit, however, that we needed licensure to stop people who, unlike us, wanted to rip off the health care reimbursement system and were caring for patients improperly. In hindsight, our state and many others would be better off if, years ago, we all had had some state regulations with strong enforcement abilities to stop dishonest companies from setting up shop. Possibly, many outsiders—especially our lawmakers and governmental agencies—would not view our industry as tainted and think that we commit fraud and abuse on a daily basis.

By the end of 1999, it was obvious to the NAMPS membership that our ethics committee worked great for our active members. However, if a company persisted in what NAMPS considered an unethical manner, all the association could do was remove that company from the association. Unless the company agreed to correct the problem, we could not effect any change in their business practice. In addition, we could achieve little with companies whose owners believed there was no reason for them to join an association of their peers.

NAMPS approached Nevada’s Board of Pharmacy and asked if the board would regulate the state’s HME industry. Fortunately, they agreed and moreover found a Nevada Revised Statute (NRS) that applied to our industry within the existing pharmacy statutes. Consequently, we avoided the cumbersome process of having new legislation proposed and passed by our state legislature. With help from Beth Bowen, executive director of the North Carolina Association of Medical Equipment Services and the North Carolina Board of Pharmacy, who provided us with their rules and regulations to use as a template, we were quickly on our way.

NAMPS enjoys an excellent relationship with our state Medicaid department, and they worked closely with us in formulating our medical devices, equipment, and gases (MDEG) rules and regulations. In 1999, our Medicaid department started site visits prior to issuing anyone a Medicaid provider number. Medicaid found that 70% to 75% of new applicants for DME provider numbers were companies without a physical location. The department wanted a regulatory body to police this problem and other possible violations so it could concentrate on taking care of beneficiaries.

On September 14, 2000, after a public hearing, the Nevada State Board of Pharmacy voted to approve our MDEG rules and regulations and license the HME industry under its regulatory authority. We were now on our way to having the strength of our state law to enforce quality, ethics, and proper patient care by every HME business operating in our state, including those out-of-state providers serving patients in Nevada.

Medicaid immediately sent a letter to all current HME providers informing them that they would need a MDEG license by April 1, 2001, to remain eligible to participate in the Nevada Medicaid program. Furthermore, new HME provider number applicants must acquire a MDEG license before their application would be considered.

The Nevada Board of Pharmacy already had a comprehensive application designed to research every pharmacy owner. We modified this application for HME company owners and sent out more than 300 applications, one to every HME provider in our Medicaid system. To date, just over 110 applications have been returned and MDEG licenses issued.

What happened to the other providers? Medicaid informed us that as of April 10, 2001, it has closed 92 providers for various reasons. Among them were 36 for loss of contact, eight for being out of business, 45 for no verification of licensure, and three because the provider asked to be removed.

The Nevada Board of Pharmacy requires a site visit by inspectors before it will issue a license. This ensures that the business actually is a full operation and not merely a garage, storage facility, or mailbox.

The investigators have an inspection form that covers the rules and regulations of our licensure, and they have refused to pass applicants who failed to meet the criteria on the form. One company owner told the inspector, “Oh, well, I will just have to do all of my business with Medicare.” Little did he realize that as of July 16, 2001, the National Supplier Clearinghouse (NSC) will require a copy of the Nevada MDEG license with their HCFA 855S form. Already one new Medicare provider applicant and one re-enrollment applicant were informed that they had to acquire their MDEG license before the NSC would consider their application.

The Nevada State Board of Pharmacy selected five individuals to form a MDEG committee to oversee the HME licensure and report their findings and suggestions. Four members of NAMPS participate as well as the former supervisor of Nevada Medicaid Services. One of our major responsibilities will be to address complaints logged against suppliers. These complaints can be from patients, the medical community, and also the HME businesses. We are setting up a matrix to address various offenses with procedural systems for responses and enforcement of existing law with penalties when warranted. In addition, we are searching out those companies that have not been licensed. The Board of Pharmacy will send them a letter telling them to either apply for their MDEG license or cease doing business as an HME provider.

Finally, there is the power of our state, law to correct any unethical, abusive and/or fraudulent activity of any HME company serving patients in Nevada. All providers will be working on the same level field adhering to and practicing standards that will protect the patient as well as our health insurance reimbursement system. It is NAMPS’ hope that licensure will improve the image of the HME industry in the eyes of governmental agencies as they work to eliminate fraud and abuse in the health care system.

Rich Pozesky is president/executive director of NAMPS. Contact NAMPS at (702) 294-6680; nampsed@aol.com.