Bill’s pay-for includes sweeping cut to Medicaid payments for HME

Friday, May 22, 2015

WASHINGTON – As HME stakeholders prepared to descend on Capitol Hill on Thursday morning as part of the AAHomecare Washington Legislative Conference, an unexpected item was added to their to-do list.

The House Energy and Commerce Committee announced that morning that the pay-for for the 21st Century Cures Act included reducing Medicaid payments to match Medicare payments for certain HME included in the competitive bidding program, a move it says will bring in $2.8 billion, according to The Hill.

“This is something you need to go to the Hill and talk about,” Jay Witter, senior vice president of public policy at AAHomecare, told attendees the day before, when the pay-for was a threat but not official. “You need to talk about the challenges of the huge cuts to all areas in 2016 and on top of that these cuts to Medicaid.”

The Cures Act, which the committee plans to put to a full vote in the House in June, seeks to streamline the Food and Drug Administration’s approval process for new drugs. Much of the act’s cost comes from $10 billion over five years in new funding for medical research at the National Institutes of Health, the Hill reports.

Witter said AAHomecare met with committee members the week prior to express their concerns, but they largely fell on deaf ears.

“I don’t think they were seeing the light,” he said.

While individual state Medicaid programs have the purview to make adjustments to their payments—and some, like Virginia’s, have already adopted bid rates—this would be a sweeping change.

The idea of applying competitive bidding rates to Medicaid is nothing new. The president often includes such a provision in his annual budget, and the Office of Inspector General has published a number of reports saying state Medicaid programs could have saved money by using bid rates.

“Congress has talked about including this provision as a pay-for for numerous years,” Witter said.

At least the timing of the committee’s announcement was right, with attendees on the Hill that day to lobby lawmakers on industry issues.

“Happy I’m in D.C. right now,” wrote provider Gary Sheehan on Twitter in response to the news.