News from American Pharmacies, a Co-Op Owned by Independent Pharmacies.

There continues to be a great deal of interest regarding DMEPOS accreditation and exemption, especially as some dates have changed. The deadline is effective at the end of this year rather than the beginning--a very big win for community pharmacy.

Here is very specific information for your files.

The deadline for providing CMS with evidence of accreditation or exemption is now Jan. 1, 2011. Authorization for the extension is via Section 3109 (a) of the Patient Protection and Affordable Care Act (PPACA) which amends subparagraph (F)(i) of section 154(b)(1)(A) of the Medicare Improvements for Patients and Providers Act of 2008.

Here is the most important point to remember:

January 1, 2011

That is the drop-dead date by which you MUST show CMS that you meet accreditation standards OR meet the following standards for an exemption:

The total billings by the pharmacy for DMEPOS are less than 5 percent of total pharmacy sales for the previous three calendar years; and
The pharmacy has been enrolled as a supplier of durable medical equipment, prosthetics, orthotics and supplies and has been issued a provider number for at least five years; and
No final adverse action has been imposed on the pharmacy in the past five years and
The pharmacy submits an attestation, in the manner and at the time frame to be determined, that the pharmacy meets the criteria listed in 1-3 and
The pharmacy agrees to submit materials as requested during the course of an audit conducted on a random sample of pharmacies selected annually.

Total DMEPOS billings are considered as less than 5 percent of the total pharmacy revenue. For example, if a pharmacy is part of a larger location, such as a grocery store that also has a pharmacy or a pharmacy that sells other items; the total DMEPOS sales would be less than 5 percent of the total pharmacy sales, not that of the total grocery/store receipts.

Chain pharmacies defined by the National Supplier Clearinghouse as having more than 25 locations, may not be able to meet the 5 percent exemption criteria. Currently a chain is accredited as one entity and, thus all the locations receive one accreditation decision. In order to determine whether the chain qualifies for an accreditation exemption, the chain's total pharmacy and DMEPOS sales, including sales from all its locations, will be considered If the total DMEPOS sales are less than 5 percent of the total pharmacy sales, then the pharmacy would meet that particular exemption criterion.

Newly opened locations are required to be accredited because they do not meet the exemption requirement of having been enrolled in the Medicare program as a DMEPOS supplier for at least 5 years. Therefore, newly opened locations within chains or single locations would have to be accredited.

If a location is part of a franchise, then that location is not considered a chain and thus each location would have to receive a separate accreditation decision, if required. Accordingly, each location in this case is reviewed separately to determine whether it meets all of the exemption criteria.