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Keeping watch on those who hold the public trust and money

Georgia moving to regulate another industry, in the name of consumer protection

Georgians who need oxygen equipment, walkers, blood sugar monitors or other durable medical equipment could be impacted by legislation now awaiting the governor's signature. But there's debate over whether it will provide those consumers with important protections or increase medical costs by unnecessary regulations.

Under the legislation, many suppliers of durable medical equipment would have to have a state license to sell to Georgia residents. To get the license, the companies would have to have an office or place of business in Georgia. They also would have to meet state standards, such as training for all workers who deliver, maintain or repair equipment, and could be subject to other rules set by the State Board of Pharmacy.

For years, the Georgia Association of Medical Equipment Suppliers (GAMES) has lobbied for such a law. But prior versions of the bill failed after criticism that the proposals were intended primarily to protect Georgia businesses from out-of-state and internet competition.

Last summer, the Georgia Occupational Review Council, which reviews all bills that propose licensing of a business or profession, reported that a version of the bill then under consideration could raise costs without providing additional consumer protections.

The council also said there was no documented evidence or pattern of Georgia customers being harmed, and that Medicare and Medicaid already require suppliers to meet standards that protect customers.

But Georgia consumers now have no local agency to handle and investigate complaints about medical equipment suppliers, so there is no way of determining the number of problems people here have faced, said GAMES president Tyler Riddle.

He also said that because the state hasn't tracked the medical equipment businesses, it doesn't know if those who deliver the equipment to patient homes may have criminal records. "It's kind of terrifying," he said.

The legislation would provide state-level accountability, he said. In the medical field, he said, "With more regulation comes better outcomes."

Only equipment prescribed by doctors and covered by Medicare, Medicaid or private insurance is covered by the legislation. Because they already monitor payment rates, Riddle said, licensing should not spike costs.

"This legislation doesn't stop anyone from selling non-prescription items, like bedside commodes," he also noted.

Georgia suppliers, like those nationwide, have been struggling in recent years after the federal government began competitive bidding for supplying certain durable medical equipment for people on Medicare. Under that process, Medicare establishes what it will pay based on national bid averages. Since the bidding began in 2011, Medicare says it has saved hundreds of millions of dollars.

But the industry, which has criticized the competitive bidding process as flawed, said nearly 40 percent of businesses have either closed or been sold to a national provider since bidding began.

The Georgia council last summer had reported that large national providers without bricks-and-mortar locations in Georgia have lower overhead and can offer a lower bid than in-state competitors.

But many states already regulate home medical equipment suppliers, and the business is primarily a local one, said Tom Ryan, president and CEO of the American Association for Homecare, an industry advocacy group. The association has found that state regulations are pro-patient and pro-small business, he said.

Often, businesses that provide equipment must conduct a home assessment, such as making sure that a home meets electrical requirements for a ventilator.

"I wouldn't want oxygen drop-shipped to a patient's home with an instruction sheet," he said.

The Georgia bill was approved March 30. The governor has 30 days to approve or veto it.





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About the Author

Lois Norder is Senior Editor for Investigations in the newsroom at The Atlanta Journal-Constitution.