Thursday, July 31, 2008

NBC Nightly News Botches Story on Competitive Bidding

NBC Nightly News aired a piece on competitive bidding on Saturday, June 26, 2008. To view the piece visit:

AAHomecare responded to the piece with the following e-mail on July 29:

NBC News
Washington, DC

Thanks for hearing me out regarding your segment on Saturday, July 26, “Congress delays Medicare cost-savings bill.” [NBC Nightly News, link:] As I mentioned, your segment is wrong on the central issue – savings for taxpayers, and it is misleading on other points. We would appreciate a correction or a follow up segment that adequately addresses at least these two issues:

First, you do not explain the full cost savings in the recent Medicare bill, the Medicare Improvements for Patients and Providers Act of 2008 (MIPPA). In order to get the reforms and delay in the competitive bidding program under congressional pay-go rules, the durable medical equipment (DME) industry agreed to a nationwide reimbursement cut, plus it will forgo a CPI reimbursement adjustment, which will, according to the Congressional Budget Office, completely offset and possibly over pay for the savings that the flawed bidding program would have reaped. If you need documents from CBO to review, we would be happy to provide them. As you should know, CBO is the final word – the only word – when it comes to what a law will cost. MIPPA saves taxpayers more than a billion dollars in lower reimbursement payments to the DME industry. That makes the title of your segment, and the entire point, misleading at best. Again, the bidding program was not “stopped dead in its tracks” as the lead-in suggests. It was delayed in order to correct the massive problems associated with its implementation.

Second, you fail utterly to account for services required in providing home oxygen therapy or a walker, the two examples of “over-payment” that you cite. As you well know, you can’t just leave an oxygen concentrator at the front door of a senior with COPD who depends on oxygen in order to live. It requires 24-7 on-call service, patient education and compliance, maintenance, delivery, and of course all of the required paperwork if the provider is to have a prayer of getting reimbursed by Medicare. Even a walker ($110) must be delivered, often in conjunction with hospital discharge which can occur at virtually any time (Friday evenings, weekends), it must be adjusted for the height of the user, and instruction is required. The whole point of a walker is what? To prevent falls. To promote safety and independence in the home. To keep the person out of the ER or nursing home. So the typical Medicare user does not have the luxury of driving to Wal-Mart (which charges $70, you say) and taking it home and setting it up on the day they arrive home from the hospital. The higher price in Medicare offsets the delivery and services tailored to the Medicare beneficiary, who is in the cheapest care setting possible – his or her own home. Moreover, the government study you cite only examined equipment costs, by their own admission, leaving an incomplete accounting of what it costs to actually provide these items in the manner required to Medicare beneficiaries.

Finally, your contention you made over the phone that the Centers for Medicare and Medicare Services (CMS) is transparent in its information and decision-making is sadly wrong. And you seem to assume that there are no politics or spin in play from your government sources.

Our industry, which represents about $8 billion in annual Medicare spending (out of about $430 billion annually in Medicare), just agreed to give up $1 billion, which will reduce taxpayers’ burden. That will be a hard pill to swallow from many of our mom-and-pop providers who have served their communities for decades, and we have heard an earful from them since it’s gotten much harder to stay in business given lower Medicare and Medicaid reimbursement rates and skyrocketing transportation costs. But in the meantime, we help save Medicare money by keeping people out of institutions, receiving quality services and equipment at home. It’s a shame you were not able to convey any information along those lines.

Your viewers deserve to understand what’s going on in Washington and they can’t do that without accuracy and context, both sorely lacking in your piece.

Wednesday, July 16, 2008

Fox Business Channel Looks Into Fraud Tied to Deceased Doctors

During a Senate Committee on Homeland Security and Governmental Affairs hearing held Wednesday, July 9, on Medicare fraud tied to deceased doctors, Senators from both parties grilled the Centers for Medicare and Medicaid Services’ (CMS) deputy administrator, Herb Kuhn, on the government agency’s lack of oversight for payment claims.

To learn more about this report read the New York Times article:

Fox Business Channel Wednesday evening (July 9), Tyler Wilson made it very clear that those scamming the government and using deceased doctor’s numbers are not members of the American Association for Homecare, but instead work on the periphery of legitimate businesses.

David Asman questioned Wilson on the program America’s Nightly Scoreboard, about the $76.6 million to $92 million paid by Medicare for false claims and asked whether he believed these numbers would continue to increase. Wilson said the number will expand unless Medicare improves on up-front enforcement. He explained that this issue has been a contention of the industries for some time and the Centers for Medicare and Medicaid have failed to use the tools already at their disposal and already within their authority to police these claims and not pay them.

Monday, July 14, 2008

Price Versus Cost of Effective Use for Home Devices

Response to Michael Leavitt's editorial in the Wall Street Journal by Tyler Wilson.

July 14, 2008; Page A16

It was disappointing to see Health and Human Services Secretary Michael O. Leavitt leading the effort to retain the competitive bidding program implemented this month for medical equipment providers who service Medicare beneficiaries ("Will Congress Continue a Medicare Scam?," op-ed, July 9). He fails to mention the problems with the bidding program.

The Center for Medicare and Medicaid Services (CMS), which the secretary oversees, has implemented a program that is creating havoc for physicians, providers, and hospital discharge officials, and may be endangering the lives of some Medicare beneficiaries. Since the program began July 1, the American Association for Homecare has received numerous complaints.

How disingenuous has Secretary Leavitt been? He is comparing prices of medical equipment from licensed providers to equipment obtained on the Internet. Equipment from the Internet comes without 24-hour support, patient/caregiver education, accreditation, state licensing or quality control. Surely, Secretary Leavitt is aware that the Medicare program requires its traditional providers to ensure that beneficiaries or their caregivers can operate the power wheelchair, hospital bed, oxygen system or other equipment. Is the administration now suggesting that seniors and others on Medicare should order vital medical equipment from and have it dropped at their doorstep by UPS? Is that the answer for improving health care?
In Washington, lawmakers have not been fooled by Mr. Leavitt's "spin" and know this bidding program puts constituents in harm's way. That's why the House voted overwhelmingly to suspend the program for at least 18 months so it can be fixed. The secretary did not mention that the bidding program has loopholes allowing unlicensed companies to provide sensitive equipment, such as oxygen, and has awarded contracts to companies located miles away from the service area to provide equipment they have rarely or never previously provided.

Congress should put this program on hold until we can be assured that Medicare beneficiaries will be treated with dignity once again.

Tyler J. Wilson
American Association for Homecare
Arlington, Va.

To read this letter to the editor online visit:

Wednesday, July 9, 2008

“Delay” Means “Improve” to Seniors and Homecare Providers

An opinion piece written by the secretary of the Department of Health and Human Services, Michael Leavitt, and published on July 9, 2008 in The Wall Street Journal (“Will Congress Continue a Medicare Scam?”) cites the same old argument comparing the cost of homecare services and products to equipment purchased on the Internet. He also discusses legislation which is up for a vote this week. Leavitt says, “Make no mistake: ‘Delay’ means ‘kill.’ Killing this competitive-bidding program would cost taxpayers about $1 billion annually, while unjustly overcharging senior citizens.”

In this case, “Delay” actually means “Improve.” Champions in Congress are trying to improve the program during an 18-month delay because the program has been so poorly implemented. Not only has the first week proved a lack of communication on the part of the Centers for Medicare and Medicaid Services (CMS) when educating providers and beneficiaries of the changes occurring, but the program has also reduced access to care in all competitively bid areas due to unprepared and/or unqualified contract winners. The lack of verification by CMS of supplier capacity, and CMS approval of long-distance suppliers with no location near the service area has created confusion and frustration for many beneficiaries, referral sources, and hospital discharge planners. CMS is also still allowing unlicensed suppliers to be contract providers.

Leavitt says Congress’ failure to uphold this program will mean they do not have the political courage to make harder decisions on healthcare reform. But the opposite is true. If members make the difficult choice of voting for a delay even though the President has threatened a veto and the competitive bidding program has already been implemented, they will be making the honorable choice, the choice to protect seniors from further harm.

Read Leavitt’s Opinion piece at:
Add your opinion to the Opinion Journal Forum at:

Wednesday, July 2, 2008

New York Times Publishes Industry Letter to the Editor

The Medicare Bidding Program
Published: July 2, 2008
To the Editor:

Re “Medicare Savings vs. the Lobbyists” (editorial, June 25) and “High Costs, Courtesy of Congress,” by David Leonhardt (Economic Scene, June 25), about the Medicare competitive bidding program for home medical equipment:Congress is considering reforms to the bidding program for excellent reasons. As presently configured, the bidding program excludes some providers and will undoubtedly reduce access to care for Medicare beneficiaries.

The reforms to the program proposed by Congress would preserve quality of care and save taxpayers every dime that the flawed bidding program would have reaped in reduced payments.

Your editorial dismisses as “overblown” the concerns expressed by patient groups like the A.L.S. Association, the United Spinal Association and the Paralyzed Veterans of America.

Moreover, pricing for home medical equipment and services for Medicare beneficiaries cannot be benchmarked to the cost of equipment purchased over the Internet. That comparison ignores the costs of the essential services required in providing quality home care to the elderly and people with disabilities.

Tyler J. Wilson
American Association for Homecare
Arlington, Va., June 25, 2008