Bennies need to feel the pain

Tuesday, July 31, 2007

There's a lot of talk in the industry about Medicare beneficiaries these days. Much of this talk has to do with how competitive bidding and other reimbursement cuts will reduce access to quality equipment that best serves a beneficiary's clinical needs. That's a noble position, a caring position, but also a misguided position.
Providers aren't obligated to promise beneficiaries the moon and then try to deliver it. That may have worked when reimbursement was robust (10 years ago, providers used to brag about giving away all kinds of stuff in the name of service), but these days--with competitive bidding and other reimbursement and regulatory changes bludgeoning HMEs--it's a recipe for disaster. You've got to make an adequate margin on everything you provide. Beneficiaries need to know that. Referral sources need to know that.
The time has come for the beneficiary to share the pain or at least face reality. That reality is this: Certain products and services fit into Medicare's reimbursement formula, others don't. If a beneficiary desires a product that Medicare doesn't adequately reimburse for, he's got to pay extra or go with something less expensive. That's what CMS had in mind when it launched the advanced beneficiary notice (ABN) or patient upgrade provision a few years ago. The agency never intended for providers to supply the best of the best and be reimbursed for something much less expensive. Providers dug that hole for themselves. Now it's time to climb out, and, if you think about it, the timing couldn't be better. Sure, reimbursement's going down, but you can't go a day without hearing about how much money baby boomer seniors--or their kids--have stashed away. Obviously, they've got to spend some of that do-re-mi on DME, especially if Medicare's going to continue to cut the benefit.
You need not feel guilty or sheepish about introducing your customers to the new world of HME, which is really the everyday world for most of the economy. As they say: It's business, not personal. If Medicare reimburses for a Ford Focus, don't supply a Honda Accord at no extra cost. That's foolish.
Providers need to stop acting like martyrs, shielding beneficiaries and referral sources from Medicare reimbursement cuts.
Until this happens, the industry can forget about generating any significant beneficiary support in its battles with CMS.