AAHomecare proposes oxygen overhaul

Sunday, January 11, 2009

ARLINGTON, Va. - AAHomecare met with industry stakeholders last week to unveil a sweeping reform plan for home oxygen therapy that it hopes will protect the benefit from future reimbursement cuts.

The plan, developed by AAHomecare, the Council for Quality Respiratory Care and other industry stakeholders, proposes changing Medicare statute to incorporate services.

"The threat is extremely real, if nothing is done," said Walt Gorski, vice president of government affairs for AAHomecare. "The statute says oxygen and oxygen equipment, so that's what Medicare pays for. Until we're able to delineate the services that we provide, we will always be subject to government reports that say, 'This is what the equipment costs; here's what they're paid; we can cut the price.'"

Thirteen state and regional associations, The VGM Group, The MED Group and other industry stakeholders attended the meeting.

The plan also proposes changing Medicare statute to describe oxygen companies as "providers" instead of "suppliers" to recognize the services they provide.

Additionally, the plan proposes a new payment methodology for oxygen: the case mixed adjusted system. Under the system, providers would be reimbursed on a sliding scale based on patient ambulation (nocturnal only, moderate ambulation, high ambulation). Then the rate would be adjusted based on the patient's needs, such as high liter flow, according to industry stakeholders.

"We're in a cross-subsidization world right now, where stationary payment pays for portable," said Cara Bachenheimer, senior vice president of government relations for Invacare, who attended the meeting. "Until we get into a payment world where reimbursement is logically associated with a cost to service, then we're never going to get out of this constant hammering on Capitol Hill."

The case mixed adjusted system should resonate with legislators, because it's the system used by most other Medicare providers, industry stakeholders said.

The budget neutral plan would effectively carve out oxygen from national competitive bidding (equipment, not services, are put out to bid) and eliminate the 36-month cap (under the new payment methodology, providers would be reimbursed for as long as patients need services), industry stakeholders said.

AAHomecare has scheduled a Capitol Hill Lobbying Day for Feb. 11 to start talking to legislators about the plan.

While some of the stakeholders who attended the meeting championed the plan's proposals to make the oxygen benefit more service-centric, they left feeling queasy about the new payment methodology.

"What are providers going to get paid?" said Karyn Estrella, executive director of New England Medical Equipment Dealers. "We need a ballpark figure. Without that, we can't ask providers to go down to Washington, D.C., and lobby for this. While most providers will embrace the concept, they're going to want more specifics."