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REFERENCE TITLE: durable medical equipment |
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State of Arizona Senate Forty-eighth Legislature First Regular Session 2007
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SB 1515 |
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Introduced by Senators Burton Cahill: Hale; Representative Ableser
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AN ACT
Amending title 36, Arizona Revised Statutes, by adding chapter 11; relating to durable medical equipment.
(TEXT OF BILL BEGINS ON NEXT PAGE)
Be it enacted by the Legislature of the State of Arizona:
Section 1. Title 36, Arizona Revised Statutes, is amended by adding chapter 11, to read:
CHAPTER 11
DURABLE MEDICAL EQUIPMENT
ARTICLE 1. GENERAL PROVISIONS
36-1301. Definitions
In this chapter, unless the context otherwise requires:
1. "Accrediting organization" means the joint commission on accreditation of healthcare organizations or another national accreditation agency with standards for accreditation that are comparable to the licensure requirements of this article.
2. "Affiliated person" means a person who directly or indirectly manages, controls or oversees the operation of a corporation or other business entity that is licensed pursuant to this article, regardless of whether the person is a partner, shareholder, owner, officer, director, agent or employee of the entity.
3. "Applicant" means an individual applicant, in the case of a sole proprietorship, or an officer, director, agent, managing employee, general manager or affiliated person, or a partner or shareholder with an ownership interest of at least five per cent in the applicant corporation, partnership or other business entity.
4. "Consumer" means any individual who uses durable medical equipment at the individual's place of residence.
5. "Department" means the department of health services.
6. "Durable medical equipment" means any medical device that can be used in a residential setting and includes any equipment that provides therapeutic benefits or that enables the consumer to perform certain tasks the consumer is otherwise unable to undertake due to certain medical conditions, disabilities or illnesses. Durable medical equipment does not include prosthetics, splints, braces or aids that are custom fabricated by a licensed health care provider.
7. "Durable medical equipment personnel" means persons who are employed by or under contract with a durable medical equipment provider.
8. "Durable medical equipment provider" or "provider" means a person or entity that sells or rents, or offers to sell or rent, to or for a consumer any durable medical equipment or durable medical equipment services.
9. "Durable medical equipment services" means the delivery, installation, maintenance or replacement of durable medical equipment, or instruction in the use of durable medical equipment and related supplies.
10. "General manager" means the individual who has the general administrative charge of the premises of a licensed durable medical equipment provider.
11. "Licensee" means the person or entity to whom a license to operate as a durable medical equipment provider is issued by the department pursuant to this article.
12. "Moratorium" means a temporary cessation or suspension of the sale, rental or offering of durable medical equipment or durable medical equipment services that is mandated by the department.
13. "Person" means any individual, firm, partnership, corporation or association.
14. "Premises" means those buildings and equipment that are located at the address of the licensed durable medical equipment provider to provide durable medical equipment services and that are in reasonable proximity as to appear to the public to be a single provider location.
15. "Residence" means the consumer's home or place of residence, whether temporary or permanent. Residence includes nursing homes, assisted living facilities, transitional living facilities, adult family care homes and other congregate residential facilities.
36-1302. Licensure; requirements; exemption from licensure; violation; classification; civil penalties; remedies
A. The following must apply for and receive a license issued by the department pursuant to this article:
1. A person or entity that holds itself out to the public as providing durable medical equipment or durable medical equipment services in this state or that accepts physician orders for durable medical equipment or durable medical equipment services in this state.
2. A person or entity that holds itself out to the public as providing durable medical equipment in this state that typically requires durable medical services.
B. A person required to be licensed pursuant to this section must apply for a license on a form prescribed and provided by the department and must submit an application fee and initial licensure fee prescribed by the department by rule. The department shall issue a license to each applicant the department determines meets all of the requirements for licensure prescribed by the department by rule.
C. A license issued by the department pursuant to this article expires two years after its effective date, unless it is suspended or revoked earlier. A PERSON OR entity may apply for renewal of a license by submitting an application for renewal and a licensure renewal fee as prescribed by the department by rule.
D. Separate licenses are required for all premises even if they are operated under the same management.
E. Unless they have a separate company, corporation or division that is in the business of providing durable medical equipment and durable medical equipment services for sale or rent to consumers at their regular or temporary place of residence pursuant to this article, the following are exempt from the licensure requirements of this article:
1. Providers that are operated by the department or by the federal government.
2. Nursing homes, assisted living facilities, home health agencies, hospices, intermediate care facilities, homes for special services, transitional living facilities, hospitals, ambulatory surgical centers and any other health care institutions that are licensed by the department pursuant to this title.
3. Manufacturers and wholesale distributors that do not sell directly to consumers.
4. Licensed health care practitioners who use durable medical equipment in the course of their practice but who do not sell or rent durable medical equipment to their patients.
5. Pharmacies that are licensed pursuant to title 32, chapter 18.
F. A person who offers or advertises durable medical equipment and durable medical equipment services to the public without a license as required pursuant to this section and who is not exempt from licensure requirements of this section is guilty of a class 3 felony and is subject to injunctive relief pursuant to this article.
G. The department shall refer for prosecution to the appropriate law enforcement agency any person or entity that it believes has received government reimbursement for services provided by an unlicensed provider.
H. If the department determines that a licensee is concurrently operating both licensed and unlicensed provider premises, The department may impose a civil penalty or moratorium, or both, or revoke the existing licenses of any or all of the licensee's licensed provider locations until the unlicensed provider premises are licensed. If the department imposes a moratorium, the licensee must continue without interruption to provide services related to equipment sold or rented before the moratorium unless the department otherwise directs.
I. A provider found to be operating without a license may apply for licensure but must cease operations until the department issues a license to that provider.
36-1303. Investigations; disciplinary action; civil penalty
A. The department shall conduct licensure complaint investigations, including full licensure investigations with a review of all licensure standards. Complaints received by the department from individuals, organizations or other sources are subject to review and investigation by the department.
B. After a hearing held pursuant to title 41, chapter 6, article 10, the department may take any of the following disciplinary actions, alone or in combination for any act of unprofessional conduct:
1. Revoke or suspend a license.
2. Impose a civil penalty of not more than five thousand dollars per day for each violation of this article.
3. Initiate injunctive proceedings pursuant to this article.
C. The department may deny the issuance of a license to any applicant, or may revoke the license of a licensee, that:
1. Made a false representation or omission of any material fact in making the application, including the submission of an application that conceals the controlling or ownership interest or any officer, director, agent, managing employee, affiliated person, partner or shareholder who may not be eligible to participate.
2. Has been previously found by any professional regulatory board or agency to have violated the standards or conditions relating to licensure or certification or the quality of services provided.
3. Has been or is currently excluded, suspended or terminated from, or has involuntarily withdrawn from, participation in the Arizona health care cost containment system or participation in programs offered by the Arizona health care cost containment system or any other governmental or private health care or health insurance program.
D. The department may issue an emergency order immediately suspending or revoking a license if it determines that any condition within the responsibility of the durable medical equipment provider presents a clear and present danger to public health and safety.
E. The department may impose an immediate moratorium on any licensed durable medical equipment provider if the department determines that any condition within the responsibility of the durable medical equipment provider presents a threat to public health or safety.
F. For the purposes of this section, "unprofessional conduct" includes:
1. A violation of this article or a rule adopted pursuant to this article.
2. Committing an intentional, reckless or negligent act that affects the health or safety of a patient.
36-1304. Inspections
A. The department shall inspect a licensee for compliance with the requirements of this article within one year after the date of the initial licensure and at least once every two years thereafter. The department shall conduct random inspections on renewal of a license, for cause or as necessary, to assure the integrity and effectiveness of the licensing process.
B. If a licensee fails an inspection, the department shall suspend the license until the department determines that the licensee complies with the requirements of this article.
36-1305. Minimum standards
As a requirement of continued licensure, each licensed durable medical equipment provider must:
1. Offer and provide durable medical equipment and services, as necessary, to consumers who purchase or rent equipment that requires these services.
2. Provide at least one category of equipment directly and fill orders from its own inventory.
3. Respond to orders received for other equipment by filling those orders from its own inventory or inventory from other companies with which it has contracted to fill such orders, or customizing or fitting items for sale from supplies purchased under contract.
4. Maintain trained personnel to coordinate order fulfillment and billing and to schedule timely equipment and service delivery.
5. As necessary in relation to the sophistication of the equipment and services being provided, ensure that delivery personnel are appropriately trained to conduct an environment and equipment compatibility assessment, appropriately and safely set up the equipment, instruct patients and caregivers in the safe operation and client maintenance of the equipment and recognize if additional education or follow-up patient compliance monitoring is appropriate.
6. Ensure that patients are made aware of service hours and emergency service procedures.
7. At the time of the initial delivery, set up an appropriate follow‑up durable medical equipment service schedule as needed for periodic maintenance, supply delivery and other related activities.
8. Arrange for emergency service for life sustaining home medical equipment twenty-four hours each day, seven days each week.
9. Provide refresher and review training for appropriate personnel.
10. Establish a system for resolution of complaints and service problems.
11. Provide for timely replacement or delivery of disposable or consumable equipment supplies.
12. Honor all warranties expressed and implied under applicable state law.
13. Answer any questions or complaints a consumer has about an item or the use of an item that the consumer purchases or rents.
14. Maintain and repair directly, or through a service contract with another company, items rented to consumers.
15. Accept returns of substandard or unsuitable items from consumers. For the purposes of this paragraph:
(a) "Substandard" means less than full quality for the particular item.
(b) "Unsuitable" means inappropriate for the consumer at the time it was fitted or sold.
16. Disclose consumer information to each consumer who rents or purchases items, including all applicable warranty information. This information must include the provider standards to which the item must conform.
17. Maintain patient payment and service records pursuant to the requirements of this article.
18. Designate appropriate staff as intake coordinators and ensure that order intake personnel are appropriately trained in the types of equipment and products, commonly occurring medical conditions, service procedures, third-party billing and insurance requirements and coverage.
19. Train intake coordinators in a basic understanding of dealing with patient and caregiver needs as well as other, nondurable medical equipment provider services as they relate to durable medical equipment services and home care patient crisis management.
20. On request by the consumer or as otherwise required by state and federal law, assist consumers to meet the necessary filing requirements to obtain third-party payment to which a consumer may be entitled.
21. Maintain safe premises.
22. Comply with any additional qualifications for licensure as required by the department.
23. Comply with all other state and federal laws.
36-1306. Minimum standards; rules
The department shall adopt rules to establish reasonable and fair minimum standards relating to:
1. The qualifications and minimum training requirements of all durable medical equipment personnel.
2. License application and renewal.
3. License and inspection fees.
4. Financial ability to operate.
5. The administration of durable medical equipment providers.
6. Procedures for maintaining patient records.
7. Ensuring that the durable medical equipment and services provided by a durable medical equipment provider are in accordance with the plan of treatment established for each patient, if provided as a part of a plan of treatment.
8. Contractual arrangements for the provision of durable medical equipment and services by providers not employed by the durable medical equipment provider providing for the consumer's needs.
9. Physical location and zoning requirements.
10. Durable medical equipment requiring durable medical equipment services.
36-1307. Patient records
A. Durable medical equipment providers must maintain, for each patient, records that include the durable medical equipment and services the provider has provided. These records must also include:
1. If the equipment was ordered by a physician, any physician's order or certificate of medical necessity.
2. Signed and dated delivery slips to verify delivery.
3. Notes reflecting all services and maintenance performed, and any equipment exchanges.
4. The date on which rental equipment was retrieved.
5. Any other information that is appropriate to a specific patient relevant to the particular equipment provided to that patient.
B. Records produced pursuant to subsection A are patient records and must be maintained by the durable medical equipment provider as prescribed by applicable state and federal law. If a patient transfers to another durable medical equipment provider, a copy of the patient's records must be provided to the other durable medical equipment provider on the patient's request.
C. All other state and federal laws relating to the confidentiality of patient records apply to records maintained pursuant to this section.
36-1308. Public records
Medical and personal identifying information about patients of a durable medical equipment provider that is received by the licensing agency through reports or inspections is confidential and is exempt from public disclosure unless otherwise required by state or federal law.
36-1309. Injunctions
A. In addition to all other available remedies, if the department believes that a person has violated this article or a rule adopted pursuant to this article, the department through the attorney general or the county attorney of the county in which the violation is alleged to have occurred may apply to the superior court in that county for an injunction restraining that person from engaging in the violation.
B. The court shall issue a temporary restraining order, a preliminary injunction or a permanent injunction without requiring the department to post a bond.
C. Service of process may be on the defendant in any county of this state where the defendant is found.
36-1310. Patient referrals and rebates; prohibition; compliance with federal law
Each licensee must comply with state and federal laws regarding prohibited patient referrals and rebates. A licensee that violates this section commits an act of unprofessional conduct.
36-1311. Durable medical equipment fund
A. The durable medical equipment fund is established consisting of fees and civil penalties collected pursuant to this article. The department shall administer the fund.
B. Monies deposited in the fund are subject to legislative appropriation and are exempt from the provisions of section 35-190 relating to lapsing of appropriations.
C. On notice from the department, the state treasurer shall invest and divest monies in the fund as provided by section 35-313, and monies earned from investment shall be credited to the fund.