The ‘Good fight’ continues in 2004

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Tuesday, September 30, 2003

As 2003 winds down, and we look forward to 2004, there are several issues of importance that will affect all of us in the HME industry now and into the future:

- Competitive bidding vs. COLA freeze: We firmly believe that competitive bidding is bad for the industry and we will continue to fight it to its death. So far we have been successful in thwarting the efforts of Representative Bill Thomas (R-Calif.) in getting this passed. As we write this column, there is a healthcare bill on the table that is being driven by prescription drug reimbursement. The question still to be answered is, “How is Congress planning on paying for it?” The Senate version of the bill, which has already been written, includes a multi-year freeze on the cost of living escalation benefit that currently exists. We are still arguing in the House of Representatives and trying to persuade Rep. Thomas not to include competitive bidding in his bill. But if and when that happens, the bill will go to conference where we are very hopeful the Senate version will prevail and substitute the cost of living freeze for competitive bidding.

- Fraud and abuse: The majority of providers in our industry are honest and ethical. However, it is a few unscrupulous providers who make the headlines in the news and cause a black eye for all of the industry. We are proud to support the CMS administrator’s recent initiative to rid the industry of fraudulent providers and urge any provider who encounters a bad actor to immediately report the incident to the federal government. We must be vigilant in eradicating the few bad actors in our industry. At the same time, we are working closely with CMS to ensure that seniors and people with disabilities who medically need HME will continue to be able to receive them.

- Quality and accreditation requirements for providers: Along with our trade industry association, the American Association for Homecare (AAHomecare), Invacare supports the new federal quality standards and accreditation requirements for durable medical equipment (DME) that would help ensure the safety and effectiveness of products and services in the homecare setting. However, while we support quality standards and accreditation, we believe proposed legislation on this issue should account for the diverse nature of the industry by allowing for flexibility in the way providers comply with these requirements and for them to be complementary to the industry’s own quality control measures. We believe that providers who are currently accredited by approved national accreditation organizations should be deemed to have met the federal standards if the accrediting organizations’ standards meet or exceed what the federal government requires. We also believe specialty providers, such as rehab and assistive technology companies, should have the option of seeking accreditation by bodies with standards specific to their specialty areas. The expert panel that the government is putting together to develop the quality standards must collaborate with the DME industry when developing them, as industry experts have inside knowledge of how providers operate and comply with quality standards. Finally, we support a phase-in period of five years that is more realistic in enabling providers to make operational changes to adapt to the new federal regulatory requirements.

- Manufacturers going direct to consumers: During the past 20-plus years, competition has intensified on the manufacturing side of the HME business. This competition has been instrumental in the development of numerous new technologies which have dramatically improved the quality of life for people with disabilities. Consumers’ needs for products and services are being met in a far more superior way than they were 20 years ago. However, some manufacturers are overlooking the important role the provider plays in meeting the needs of consumers, as they bypass the provider and sell to consumers and bill payors direct. In addition to Sunrise Medical, Johnson & Johnson now has a division, Independence Technology, which will bypass the provider and sell the iBOT and iGlide directly to consumers. We, at Invacare, firmly believe the provider provides a key service component that goes unmet when manufacturers sell direct. However, many providers continue to support these manufacturers in other areas of their business. I urge every provider to examine the companies with which they are doing business today and ask this important question, “Is this corporation my partner or my competitor?” The future for the HME industry is still promising with a healthy 5- to 7-percent growth each year. While every industry has its challenges, I believe we are on the right side of the curve as more and more members of Congress are beginning to understand that home care can help reduce costs. If federal legislators all understood that every home care patient cost the government about one-fifth as much as that same patient in an institutional environment, I believe they would have a tremendous appreciation for it. However, it is a never-ending battle – but let’s all not give up the good fight!

- A. Malachi Mixon, III is chairman and CEO of Invacare Corp.

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