Physicians, platforms & supplies: ‘It’s a gray area’

YARMOUTH, Maine – The unwinding of the public health emergency and the increasing number of platforms that allow physicians to manage the distribution of medical supplies for their patients have complicated the Medicare market for providers, says health care attorney Jeff Baird.  

During the public health emergency, which stretched from March 2020 through much of April 2023, some physician groups took the position that blanket waivers to the Stark law allowed them to mail supplies to their Medicare patients, says Baird, chairman of the Health Care Group at Brown & Fortunato.   

“During the PHE, CMS essentially said, ‘You can mail supplies to patients without worrying about the in-office ancillary services exemption – if the reason you’re doing it is because of COVID-19,’” he said. “During the PHE, I feel like at least some of the physician groups were gaming the system, but based on the language of the waivers, they could make an argument that they could do this.”  

Post-PHE, some physician groups are now asking their patients to come into their offices to pick up supplies. Baird says that's also debatable.  

“One can argue that asking the patient to pick up supplies at the physician’s office complies with the wording of the in-office ancillary services exemption,” he said. “The patients are driving to the physician’s office, grabbing their catheters and walking out. But in my mind, it doesn’t comply with the intent of the exception, which is not for the physician to make money off of DME but for the distribution of supplies by the physician to be a convenience to the patient, when they come in for visit and need to walk out with a cane or several catheters, as an example.” 

In sum: “It’s a gray area,” Baird said.  

How does this all affect the provider?  

“If I own Jeff’s Medical in Dallas and one of my biggest referrals is a 20-physician urology practice and in the past, I was getting referrals from then and now they say to me, ‘We no longer refer; we just have them come in every three months,’ that sure affects me,” he said.