Homecare Sector Responds to Wall Street Journal Article on Oxygen

Last week, members of the HME community responded to an article in the Wall Street Journal printed on June 16, with the following Letter to the Editor-

Your recent article on home oxygen therapy (Medicare Rule on Paying for Oxygen Vexes Patients, June 16) underscores the often overlooked negative impact of Medicare cuts on the beneficiaries who depend on medical oxygen.

In recent years, payments to providers for the home oxygen therapy benefit have been significantly cut many times. Today, Medicare payment rates are 50 percent lower than they were 10 years ago. In 2009 alone, Medicare will cut oxygen rates by 27%, a result of the 36 month cap highlighted in your article, and a 9.5% cut to all home oxygen therapy reimbursements. These reimbursement cuts reduce access to quality care, and the new Medicare rules create problems for patients who want to move to another city to be closer to their families.

As leaders in Congress discuss healthcare reform, this is the ideal time to consider fundamental, budget-neutral reform of the home oxygen benefit. This Medicare benefit should be improved to define a uniform set of required services for all patients. Reform should also ensure adequate payment to providers for all beneficiaries, throughout the patient’s entire length of medical need.
Repeated cuts to this benefit are not a solution. Properly reforming the home oxygen benefit will require a structure that aligns Medicare payments with the cost of care and the essential patient services that providers deliver.

We hope that Congress will advance a solution that will protect the patients we serve and preserve our ability to provide the level of service they need.

To read the Wall Street Journal article, please visit http://online.wsj.com/article/SB124511204251317173.html.

House Bill Would End First-Month Purchase Option for Power Wheelchairs

A discussion draft of a healthcare reform bill released last week by House Democrats would eliminate the first-month purchase option for all power wheelchairs. The American Association for Homecare has strongly opposed the elimination of that choice and urges providers and consumers to ask Congress to preserve that choice.

While there was no cut to oxygen mentioned in the House bill, AAHomecare believes that a cut will emerge later in the legislative process as a way of paying for health reform. The Association believes a similar threat of reductions in oxygen reimbursement exists in Senate proposals.

In hopes of delaying the inevitable protests from affected healthcare sectors, legislators in both the House and Senate have not tipped their hands about all of their proposed cuts and financing options. Oxygen and wheelchair users should weigh in on this issue with their Senators and Representatives in Washington. It’s important for patients as well as providers to speak up in opposition to these cuts.

Power wheelchairs were cut by approximately 26 percent in 2007 and incurred another cut of 9.5 percent, effective January 1, 2009 as a result of the delay to competitive bidding. Remember that home medical equipment is one of the slowest-growing sectors of Medicare in terms of spending (0.75 percent annually in 2007) and is cost-effective, preferred by patients, and good home-based care achieves a chief goal for health reform through fewer re-hospitalizations.

Democratic Leaders Introduce Pay-Go Legislation

Following a call for pay-go legislation from President Obama, Democratic leaders introduced the pay/go legislation last week with 155 cosponsors. Legislators cited a need to bring down the nation’s ballooning deficit according to Congress Daily.

Huge deficits in government spending were reversed due to similar legislation in the 1990s and many members of Congress and the Obama Administration hope to see similar effects from the current legislation. The bill does limit which types of legislation can be included in the law, excluding providing higher Medicare payments to physicians.

Obama Administration Urges Statutory Pay-As-You-Go

This week the Obama administration outlined a plan to keep the federal government within its means which included a return to statutory pay-as-you-go requirements, often referred to as “paygo.” Paygo would include automatic cuts in mandatory programs as penalties for violations and means every dollar spent by Congress must have an offset. At a press conference yesterday, President Obama described it this way,” Congress can only spend a dollar if it saves a dollar elsewhere.” It’s not clear whether paygo rules would apply to the healthcare reform effort. But the growing concern among fiscally conservative Democrats and the GOP about federal spending underscores AAHomecare’s focus on HME reform legislation that is budget neutral.

The President’s plan included tasking the OMB with maintaining a Paygo ledger to record the average 10-year budgetary effects of all legislation enacted through 2013 affecting mandatory spending.

Heritage Foundation: Wrong Again on “Competitive” Bidding

The Heritage Foundation “Foundary” blog posted a piece on healthcare spending and options for savings, mentioning competitive bidding as a cost containment provision. The blog incorrectly states the program was canceled among other misperceptions.

The American Association from Homecare responded the Heritage Foundation’s “Foundary” blog posting with the following response:

I wish Heritage Foundation would simply check some of its facts. You weaken your argument if you sprinkle in false information. For instance, the "competitive" bidding program for home medical equipment and services was NOT "canceled" by any stretch of the imagination. George F. Will made the same false claim. The program was delayed by Congress in the MIPPA bill last year in order to try to address the fact that the "competitive" bidding program would have eliminated 90 percent of the competitors (virtually all small businesses) regardless of the pricing (which is set by the government anyway). The home medical equipment sector (which delivers home medical care to Medicare beneficiaries in their homes, by far the most cost effective setting for care) in fact did PAID for the delay in the bid program through a 9.5 percent reimbursement cut effective Jan. 1, 2009 in order to save the taxpayers EVERY DOLLAR that the bid program would have saved. The delay stemmed from bipartisan concern about patient access to quality care at home and the impact on small businesses. By the way, the home medical sector represents 1.6 percent of Medicare spending and spending growth in this sector of Medicare is less than 1 percent, in spite of growing demand. We're hardly your poster child for out of control spending. And the idea that a person who needs a customized power wheelchair would buy one on the Internet is just dumb. Who would deliver it? Fit it to prevent pressure wounds? Service it? etc. etc. Seriously, you should attempt to fact check this blog since the readers apparently buy it. Yes, I work for the home medical equipment sector. Please check my facts independently. Or visit www.aahomecare.org/competitivebidding.

See the Heritage Foundation blog at: http://blog.heritage.org/2009/05/29/morning-bell-show-us-the-savings/

Obama Administration Rushes to Restart Bid Program, AAHomecare Expresses Disappointment

Last week the Centers for Medicare and Medicaid Services (CMS) announced the new timeline for the program, with bidding scheduled to begin in the Fall of 2009. In response to the brief timeline, AAHomecare expressed disappointment that the Obama administration is rushing to re-implement the deeply flawed “competitive” bidding program for home medical equipment and services.

AAHomecare believes this troubled program is moving forward without addressing the many severe problems that prompted Congress to mandate reform of the program last summer. Disability groups, patients, providers, and even members of Congress expressed concern with aspect of the program. Moving forward with competitive bidding at this time represents a big step backwards for the Medicare beneficiaries who receive services.

The Medicare Improvements for Patients and Providers Act of 2008 (MIPPA) required a delay in the bid program to allow CMS to reform it. CMS is encouraging providers to begin preparing for the bidding process by updating NSC files, obtaining all necessary licenses, and becoming accredited and bonded. CMS issued the following rough timetable:

Spring 2009
• CMS begins pre-bidding supplier awareness campaign
• Program Advisory and Oversight Committee (PAOC) meeting on June 4, 2009 in Baltimore

Summer 2009
• CMS announces schedules for bidding and education events
• CMS begins bidder education campaign
• Registration period begins for bidders to obtain user identification and passwords

Fall 2009
• Bidding begins

Visit the CMS web site at www.cms.hhs.gov/CompetitiveAcqforDMEPOS/ for the details on the bidding program.