AMARILLO, TX – In prior Medtrade Monday articles, I have written about the fact that the CMS contractors (NSC, ZPICs) are focusing on whether DME suppliers are calling Medicare beneficiaries in violation of the telephone solicitation statute and Supplier Standard # 11. If the NSC concludes that such a violation is occurring, then it may revoke the DME supplier’s Part B number.
If a ZPIC concludes that such a violation is occurring, then it may instruct the DME MACs to suspend payments to the DME supplier. Under both the telephone solicitation statute and Supplier Standard # 11, a DME supplier cannot call a beneficiary (who has no prior relationship with the supplier) unless the beneficiary has given his written permission to be called by that supplier. Similar requirements can be found in FTC, FCC, and HIPAA rules.
A key issue under the telephone solicitation statute, the FTC/FCC rules, and the HIPAA marketing authorization is whether an electronic signature via a website or a recorded call will suffice for the consent requirement. By preempting most statutes and regulations that have writing requirements which may deny the effect of electronic formats, the Electronic Signatures in Global and National Commerce Act (the “E-SIGN Act”) promotes the use of electronic contracts, signatures, and recordkeeping in private business transactions.1
While CMS has not issued clear guidance on the issue, both the FTC and the FCC have indicated that electronic signatures that comport with the E-SIGN Act will satisfy the consent requirements for the FTC/FCC rules.2
Under the E-SIGN Act, an electronic contract or record to which the electronic signature is attached must be “created, generated, sent, communicated, received, or stored by electronic means.”3 Further, the electronic record must “accurately reflect[ ] the information set forth in the contract . . . and . . . remain[ ] accessible to all persons who are entitled to access . . . in a form that is capable of being accurately reproduced by later reference.”4
A person may electronically sign an electronic record through any “electronic sound, symbol, or process attached to or logically associated with a contract or other record and executed and or adopted by a person with the intent to sign the record.”5 The Uniform Electronic Transactions Act (“UETA”), adopted by most states, includes a similar definition of “electronic signature.”6
Neither the E-SIGN Act nor UETA specify the technology or technique required to electronically sign a document. Rather, the acts provide broad definitions that encompass a variety of methods and forms. Thus, “[w]hether any particular record is ‘signed’ is a question of fact” that depends on the totality of the surrounding circumstances.7 In the comments to UETA, the drafters emphasize that the surrounding facts must evidence (1) the signer adopted the sign or symbol with the intent to sign, and (2) the resulting signature is linked to the document or record. Examples of electronic signatures in the comments include “one’s name as part of an electronic mail communication”; “the standard webpage click through process” in which the signer enters information and clicks “I Agree”; and a “digital signature using public encryption keys.”8
Electronic signatures should satisfy the written consent requirements of the various telephone solicitation rules. Note that the DME supplier may have to argue this position during the appeals process under Medicare. Medicare contractors may argue that electronic signatures are not sufficient and, as a result, attempt to deny or demand a refund for all claims resulting from the telephone contacts.
Jeffrey S. Baird, JD, is chairman of the Health Care Group at Brown & Fortunato PC, a law firm based in Amarillo, Tex. He represents pharmacies, infusion companies, HME companies, and other health care providers throughout the United States. Baird is Board Certified in Health Law by the Texas Board of Legal Specialization and can be reached at (806) 345-6320 or firstname.lastname@example.org.