AAH appeals to Price to freeze rates

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Thursday, March 2, 2017

WASHINGTON – AAHomecare has asked newly minted Health and Human Service Secretary Tom Price to issue an interim final rule to repeal the fully adjusted Medicare rates that originally went into effect in non-competitive bidding areas on July 1, 2016.

In a Feb. 28 letter, the association asks Price to, instead, freeze rates at the 50/50 blended rate that took effect Jan. 1, 2016, and amend the methodology for determining adjusted fee schedules.

“I request for you to take immediate action to provide relief to DME providers and patients in non-CBAs, which have experienced dramatic reimbursement cuts over a short six-month period,” wrote Tom Ryan, president and CEO of AAHomecare.

CMS implemented phased-in rate cuts on Jan. 1, 2016, and July 1, 2016. In December, however, Congress directed the agency to retroactively delay the July 1, 2016, cuts until Jan. 1, 2017.

AAHomecare included in the letter a chart that depicts the severity of the rate cuts in non-bid areas. Rates for CPAP devices, for example, are $39.59 in 2017 compared to $104.58 in the 2015 fee schedule.

“It is still too soon to have accurate figures on suppliers’ sales and closures in response to the adjusted rates, but we know from CMS data that there are 38% fewer suppliers enrolled in Medicare today than there were in 2013,” Ryan wrote. “Given the unprecedented magnitude of the payment cuts under the adjusted rates, it is reasonable to expect a high rate of supplier attrition in non-CBAs if adjusted rates remain at current levels.”

AAHomecare argues that if Price waits for CMS to finalize overdue annual reports on the overall impact of competitive bidding—the last was published in 2011—and to publish a notice of proposed rulemaking, “access to DMEPOS in non-CBAs will deteriorate quickly.”

“Using an IFR to suspend or repeal rules implementing the adjusted fee schedules would also allow the secretary to align the transition to DMEPOS adjusted fee schedules with similar transitions to payment adjustments in other Medicare benefits,” Ryan wrote.