Tennessee's Home Medical Equipment License

Tennessee requires a license from the Health Facilities Commission to "establish, conduct, operate, or maintain in the State of Tennessee any home care organization providing home medical equipment" (Tenn. Comp. R. & Regs. 0720-30-.02(1)). The definition reaches suppliers based anywhere: home medical equipment services are services provided "by any person who sells or rents home medical equipment for delivery to the consumer's place of residence in this state, regardless of the location of the home medical equipment provider" (0720-30-.01(23)). The license costs $1,404 a year, and a Tennessee location is optional.

What equipment does Tennessee's license cover?

The rule's list of home medical equipment is broad (0720-30-.01(21)(a)):

• any device bearing the federal prescription legend;
• ambulating assistance and mobility equipment, and rehabilitation seating;
• oxygen care equipment and oxygen delivery systems;
• respiratory care equipment and respiratory disease management devices;
• rehabilitation environmental control equipment, ventilators and apnea monitors;
• diagnostic equipment and feeding pumps;
• "A bed prescribed by a physician to treat or alleviate a medical condition";
• TENS units, sequential compression devices and neonatal home phototherapy devices.

It excludes equipment used by hospitals and nursing facilities in treating their patients (unless delivered by a separate home equipment unit), "Upper and lower extremity prosthetics and related orthotics," "Canes, crutches, walkers, and bathtub grab bars," equipment provided through a physician's office incident to a physician's service, and certain pharmacist-provided drug administration and enteral or parenteral equipment (0720-30-.01(21)(b)).

Do I need a Tennessee location?

No. The rule describes four kinds of providers: in-state providers with a physical location, in-state providers without one, "Out-of-state providers who do not have a physical location," and "Mail order companies" (0720-30-.01(22)(a)). "If a provider does not desire an in-state location, this information is required to be provided at the time of application," and a provider without one "shall designate the type of category desired upon initial application" (0720-30-.02(1)(e), (2)(g)). The license and wall certificate show whether the agency has a physical location.

No location does not mean no oversight. "Providers who do not have a physical location must comply with survey requirements and provide access and documentation to surveyors necessary to conduct a survey" (0720-30-.01(22)(b)). Expect to produce your policies, patient files and delivery records for a Commission surveyor. See licensing as an out-of-state DME supplier.

What does the application require?

The application goes on the Commission's form with the $1,404 fee, which "must be submitted with the initial application or renewal application and is not refundable" (0720-30-.02(2)(b)). The rule adds:

1. Financial ability. "The applicant must prove the ability to meet the financial needs of the agency" (2)(d).
2. A survey. "The applicant, through the designated contact person, shall allow the home care organization providing home medical equipment to be inspected by a Commission surveyor." Deficiencies require a plan of corrective action before the Board considers the application (2)(f).
3. Ownership and governance. The governing body appoints a qualified administrator, and "all ownership interests of five (5) percent or more (direct or indirect) shall also be disclosed" for a corporation (0720-30-.04(1)).
4. No early patients. "Patients shall not be admitted to the agency until a license has been issued," and applicants may not hold themselves out as an agency before then (2)(c).

The rule also warns against "filing for a license through a second party when an individual has been denied a license" or has had one disciplined (2)(e). A preparer assembling an application is fine; using a different applicant to get around a denial is not.

Does accreditation help?

Yes. "Any home medical equipment provider accredited by the Joint Commission on Accreditation of Health Care Organizations, Community Health Accreditation Program or other approved accrediting bodies may submit documents evidencing current accreditation and shall be presumed to comply with the requirements of the Board," and licensing becomes effective on written notice from the Board's staff that the accreditation meets the standards (0720-30-.04(5)). Since a Medicare supplier must be accredited before enrolling, most Tennessee applicants can use this. Ask the Commission whether your accrediting organization is one of the "other approved accrediting bodies."

Who runs the agency day to day?

The administrator, who organizes the agency's work, hires qualified staff and ensures their education. A person with sufficient experience must be authorized in writing to cover short absences, "Any change of administrators shall be reported to the Department within fifteen (15) days," and an administrator may serve only one licensed home care organization unless it provides other home care categories under the same ownership and location (0720-30-.04(2)-(3)). Compare staffing rules in other states in designated representatives and exemptees.

When does the Tennessee license expire?

On its own anniversary, not a statewide date. Licenses "are not transferable or assignable and shall expire and become invalid annually on the anniversary date of their original issuance" (0720-30-.02(1)(c)). A licensee that renews within 60 days after expiration pays a late penalty of $100 "per month for each month or fraction of a month that renewal is late," capped at twice the renewal fee. After that 60-day grace period, the licensee must reapply with a new application and fee and submit to a new inspection (0720-30-.02(4)). With a $1,404 fee, a missed date can cost up to $2,808 in penalties before the license lapses. See a renewal calendar for state DME licenses.

Does a change of ownership need a new license?

"A proposed change of ownership, including a change in a controlling interest, must be reported to the Department a minimum of thirty (30) days prior to the change," and "A new application and fee must be received by the Department before the license may be issued" (0720-30-.02(3)). The rule treats transfers of the agency's assets, leases, partnership changes and certain mergers as changes of ownership. Build the 30 days into any closing timeline. See buying a DME company.

How do we help with Tennessee?

Tennessee is a standard state at $699 (pricing). We prepare the application, the ownership disclosure, the financial documentation and the accreditation packet, set the no-location category if you need it, prepare you for the survey, and track the anniversary renewal. Your owner or an officer signs, you designate the contact person for the surveyor, and you pay the Commission directly. See the Tennessee state page.