Tuesday, July 28, 2009

AAHomecare Seeks Senior Director of Government Affairs

To meet the needs of the HME sector, the American Association for Homecare is seeking a Senior Director of Government Affairs. This new position has both legislative and regulatory responsibilities addressing Medicare and other healthcare issues that impact the home medical equipment industry.

This position will be responsible for:
  • Lobbying Congress
  • Supporting the Association’s communications and membership functions
  • Work with the Centers for Medicare and Medicaid Services.
  • A minimum of 5-7 years of health care experience is necessary.
  • Candidate must possess strong communications and analytical skills.
Please send a cover letter and resume to AAHomecare Senior Director of Government Affairs Position, 2011 Crystal Drive, Suite 725, Arlington, VA 22202; fax 703-836-6730; jobs1@aahomecare.org.

Give Them Some Air! Wall Street Journal Editorial Suffers from Lack of Oxygen Facts

In a bizarre editorial this morning, the Wall Street Journal cites Medicare payments for medical oxygen therapy as Exhibit A in an editorial about controlling costs, repeating a misleading article about White House budget director Peter Orszag. The reality, not mentioned by the Journal, is that reimbursement rates for oxygen have been reduced by 27 percent in 2009 alone. There are more cuts on the table. Oxygen was cut in the Medicare Modernization Act of 2003, in the Deficit Reduction Act of 2005, and in the Medicare Improvements for Patients and Providers Act of 2008, which delayed the competitive bidding program to make a few essential improvements (contrary to what the Journal opines, it was not "blown up" by any stretch of the imagination). The delay to that program came along with a 9.5 percent cut to all bid-upon home medical equipment items to pay for the savings that the bid program was projected to save. Meanwhile, the bid program begins again this fall. See editorial at http://online.wsj.com/article/SB10001424052970203517304574303014243807246.html.

The home medical equipment and service (durable medical equipment) sector is one of the slowest growing spending areas in Medicare (0.75 percent per year per 2007 National Health Expenditures data) and it represents about 1.6 percent of Medicare spending. Good home-based care helps prevent rehospitalizations. Ironically, the Wall Street Journal has a front-page story about that topic. Quoting the Journal’s news article about reducing readmissions, "The breakdown was occurring not in the hospital, but in the transition to home." http://online.wsj.com/article/SB124873545269485081.html.

Homecare is not the problem -- it's part of the solution. But you wouldn't know that reading this editorial.

Friday, July 24, 2009

Wall Street Journal Fails to Provide Key Facts on Oxygen and Bidding

The Wall Street Journal published a story today about Peter Orszag, White House budget director, suggesting that Orszag was surprised that a member of Congress would want to increase oxygen payments in Medicare. An increase? The irony is that the fervent wish of the oxygen community is to simply end 10 years of cuts. Oxygen has been cut 27 percent -- so far -- in 2009 alone, required by the Deficit Reduction Act of 2005 and the Medicare Improvement for Patients and Providers Act of 2008 provisions. The Medicare Modernization Act of 2003 cut oxygen as well.

Oxygen payments are about half of what they were 10 years ago. How can Orszag be worried about higher rates for oxygen?

The perception of overpayment stems from the law, which only recognizes the cost of the oxygen equipment. The assumption is you could deliver an oxygen concentrator (and back-up system for power outages) to a COPD patient and they will be able to handle every detail of receiving medical oxygen, which is a highly regulated prescription drug.

The HME sector is low hanging fruit for cuts, representing politically easy “pay-fors,” given the numerous cuts over many years. What other sector has been cut more? The entire sector (oxygen, wheelchairs, etc) represents about 1.7 percent of Medicare spending and spending growth in the HME sector was 0.75 percent (2006 to 2007 National Health Expenditures data).

Moreover the article fails to mention, with respect to competitive bidding, that the home medical equipment community accepted a 9.5 percent cut beginning in January of 2009 that pays for every dollar of the approximately one billion that the bid program was projected to have saved taxpayers during the delay. The program is still designed to put most providers out of business, even if they agree to new competitively bid rates.

So it's discouraging to see no context or history or figures in the Journal’s discussion of oxygen and bidding – if the topic is controlling healthcare spending in Medicare. Homecare is not the problem in healthcare by any stretch of the imagination.

To view the article, visit http://online.wsj.com/article/SB124839406488477649.html

CNN Runs Inaccurate and Misleading Segment About Medicare Payments for Wheelchairs

A segment aired on CNN July 20, 2009 titled, “One wheelchair—one lesson of problems in health care reform,” presented a distorted, inaccurate view of the home medical equipment benefit in Medicare. The American Association for Homecare provided ample information to CNN about the costs of providing equipment and services to Medicare beneficiaries in their homes. The Association also presented information about the controversial competitive bidding program that Medicare implemented last year. However, CNN used a combination of incorrect figures and cherry-picked facts to paint a false picture of both topics.

The CNN producers and correspondent reported incorrect and inflated numbers related to the cost of the wheelchair to taxpayers, and the segment highlighted an unusually long rental situation in which the user elected to continue renting instead of allowing Medicare to purchase the chair for her, resulting in a higher cost to taxpayers. Apria Healthcare has responded to CNN about the numerous specific errors in its report.

However, the CNN reporter and producers perpetuated two myths that harm the public’s understanding of home medical equipment benefit in Medicare.

Myth Perpetuated by CNN: Medicare overpays for durable medical equipment because the same items can be purchased more inexpensively over the Internet. CNN failed to report that the value of medically required services and medical equipment (such as a wheelchair) provided to frail seniors or people with disabilities in their home in compliance with Medicare and other federal and state regulations cannot be equated with the value of the purchasing the wheelchair alone via the Internet or via a simple cash transaction at a store. Yet CNN made this myth premise of its entire segment, using incorrect and overstated figures for the cost of the chair to taxpayers. The costs of providing home medical equipment and services to Medicare patients include delivery, often within hours of discharge from a hospital, set-up, patient education, compliance, and 24-hour on-call service. It is the consumer who values the local provider as demonstrated by data that an extraordinarily small number of consumers purchase these products over the Internet and instead actively choose their local provider.

Myth Perpetuated by CNN: Home medical equipment providers escaped the price reductions that competitive bidding would have imposed. The CNN producers and reporter know that the competitive bidding program was not, in fact, “stopped after two weeks.” It was delayed in order to fix serious flaws in the program. In a far more serious omission, CNN reporter failed to report the fact, which he knew, that taxpayers benefited fully in the billion-dollar savings that last year’s competitive bidding program was projected to have produced: Providers of home medical equipment were subjected to a 9.5 percent reduction in the reimbursement rates, beginning in January 2009, for items subject to competitive bidding, as mandated by the Medicare Improvements for Patients and Providers Act of 2008. This reduction was imposed by Congress as a condition for delaying the bidding program so the program could be fixed and re-implemented. CNN had this information but failed to mention it. Instead, CNN left its viewers with the impression that providers of medical equipment escaped any negative impact because of intervention by Congress. The stark reality is that hundreds of providers of home medical equipment are struggling and in some cases failing as a result the 9.5 percent cut, and a 27 percent total cut for oxygen therapy in 2009, and even deeper cuts in reimbursement for power wheelchairs in recent years. Nor did CNN explain that the competitive bidding system is designed to reduce the number of competitors by as many as 80 percent, by arbitrarily excluding providers from Medicare, even if they agree to lower bid prices.

The net effect of this extraordinarily misleading segment is a false impression about the nature of the home medical benefit in Medicare and completely inaccurate picture of the competitive bidding issue.

To view the CNN piece, visit http://www.cnn.com/video/#/video/politics/2009/07/20/griffin.wheelchair.medicare.cnn?iref=videosearch.

Friday, July 10, 2009

AAHomecare Responds to Cleveland Plain Dealer Article on Medicare Oxygen

The American Association for Homecare’s President, Tyler Wilson, sent the following letter to the editor to the Cleveland Plain Dealer on July 8, in response to an article on oxygen:

Your recent article “Home Oxygen Industry Trying to Change Way Government Pays to Provide Service to Seniors” addresses the impact of new Medicare rules on oxygen patients and providers. The American Association for Homecare and our members who provide millions of patients with oxygen home therapy, have reached out to Congress to explain how the new Medicare rules do not recognize the services and equipment maintenance necessary to provide quality oxygen care.

In your article, CMS underestimates the intensive service component of home oxygen therapy, claiming that service is the “exception, not the rule” and that equipment “requires very little servicing.”

Despite CMS’ claims, services are a substantial, critical component for home oxygen therapy. While oxygen equipment only accounts for 28% of costs, service and maintenance components constitute the other 73%, including: Customer Service (6%), Preparation, Return, Disposables/Scheduled Maintenance (12%), Unscheduled Repairs/ Maintenance (3%), Patient Assessment, Training, Education/Monitoring (9%), Delivery (21%), and Monthly Operating overhead (21%).*

We ask members of Congress to seriously consider the negative impacts these rules have on quality services needed by patients who rely on life-sustaining oxygen.


Tyler J. Wilson, President and CEO
American Association for Homecare

* Source: “A Comprehensive Cost Analysis of Medicare Home Oxygen Therapy,” a study for the American Association for Homecare, June 2006, by Morrison Informatics, Inc., 1150 Lancaster Blvd., Suite 101, Mechanicsburg, PA 17055. (717) 795-8410.

Consumer Groups Urge Congress to Preserve First-month Purchase Option

Letters urging preservation of the first month purchase option were sent to key committees of jurisdiction over Medicare by several consumer groups in recent weeks. A letter from the Rehabilitation Engineering and Assistive Technology Society of North America (RESNA) explained that “power wheelchairs are customized products that are only provided to individuals with significant mobility limitations and medical needs following an evaluation and delivery process due to the diverse needs of each individual, they are not commodity-type items that are inventoried.”

Similar letters describing the importance of the first-month purchase option were sent by the Consortium for Citizens with Disabilities, the American Association of People with Disabilities, the Clinician Task Force, the Amyotrophic Lateral Sclerosis Association, the Independence Through Enhancement of Medicare and Medicaid Coalition, and the National Council on Independent Living.

The American Association for Homecare has expressed concerns as well stating, “The elimination of the first-month purchase option will diminish access to power wheelchairs for people with a defined medical need. In the current fiscal environment, financial institutions will not extend lines of credit to power wheelchair providers to cover the up-front costs of furnishing costly equipment. If homecare providers do not have access to capital and are unable to secure financing, providers will not be able to provide items and services to these Medicare beneficiaries. The negative result of providers having restricted access to capital and lines of credit is that Medicare beneficiaries will not have access to the most appropriate product to address their medical needs.”

Tuesday, July 7, 2009

Roll Call Prints Editorial on Home Care: A Critical Health Care Reform Solution

This week Roll Call is running an editorial by Tyler Wilson, President of the American Association for Homecare, in their online policy forum. The piece states:

“Current proposals under consideration in Washington will undoubtedly limit Americans’ choice to access home medical equipment and services. But what many policymakers don’t realize is that further cuts to this sector are also likely to increase Medicare costs over time because they will force more people into nursing homes and hospitals and spur more frequent visits to emergency rooms. If legislators are serious about lowering Medicare costs, they should understand that home care is actually a cost-effective alternative to more expensive forms of care, and should therefore be a critical component — not a casualty — of American health care reform.

Access to quality home medical equipment reduces health care costs. A recent study in the New England Journal of Medicine demonstrated that up to one-fifth of all Medicare patients are readmitted to hospitals within one month of being discharged. These unplanned visits cost Medicare an estimated $17 billion in 2004. One reason for the high readmission rates is that there is no continued interaction and guidance once patients are dismissed. Home medical equipment providers help to fill this gap by smoothing the transition from hospital to home with the equipment and services patients need.”

The editorial also discusses the limited price of receiving home oxygen as compared to a day in the hospital or nursing facilities. Medicare pays less the $7 per day for equipment and services for home oxygen. The average daily cost for nursing facilities is $200 and hospital stays are more than $5,000 per day. Mr. Wilson described the reimbursement cuts oxygen has already received, totaling 27 percent so far this year.

“Home medical equipment and service is already the most cost-effective slowest-growing portion of Medicare spending, increasing only 0.75 percent per year, according to the latest National Health Expenditures data from Medicare. That compares to more than 6 percent annual growth for Medicare spending overall. Moreover, home medical equipment represents only 1.6 percent of the Medicare budget.”

To read the full editorial, please visit: http://www.rollcall.com/news/36487-1.html