In brief: ACA decision affects HME, Merits comments on FDA investigation

Friday, March 30, 2012

WASHINGTON - The U.S. Supreme Court's decision on the constitutionality of the Affordable Care Act (ACA) could have significant repercussions for the HME industry, according to AAHomecare. After three days of oral arguments, the association noted in a bulletin last week that there are numerous HME-related provisions in the ACA, and if the Supreme Court rules that the entire act is unconstitutional, those provisions would be eliminated. The Supreme Court has two other options: It could rule the act constitutional; or it could rule some parts of the act unconstitutional and let the remaining parts stand. The HME-related provisions in the ACA include: reducing reimbursement by about $8 billion over 10 years; expanding the competitive bidding program by 21 areas; applying a 2.3% medical device tax; and eliminating the first-month purchase option for power wheelchairs. The Supreme Court will likely issue an opinion on the ACA in June. Transcripts of the oral arguments are available at

Merits comments on FDA investigation

CAPE CORAL, Fla. - Merit Health Products has hired an outside independent agency to review its policies, procedures and processes in the wake of receiving a warning letter from the U.S. Food and Drug Administration (FDA), the manufacturers stated in a letter to HME News last week. The FDA investigated Merits Health's manufacturing facility in Taichung, Taiwan, from July 11 to July 14 and found eight violations, including failure to establish and maintain adequate procedures for implementing corrective and preventative action. "Both the agency and Merits in Taiwan have been working on corrective and preventive actions as well as procedures and processes to be reviewed to ensure requirements of documents are meet," stated Todd Aiazzone, projects coordinator. "Merits in Taiwan has sent a second response to the FDA but has not yet heard back to date of this letter. Merits in Taiwan is in the final stages of preparation to welcome back the FDA for a re-inspection." For more on this story, see "Also on the FDA's list: GF, Merits Health" in the April issue and online.

PFQC spearheads letter-writing campaign for MPP

WATERLOO, Iowa - The People for Quality Care (PFQC) last week sent a letter signed by 458 Iowa residents and VGM employees to Sen. Chuck Grassley, R-Iowa, urging him to support the industry's alternative to competitive bidding. PFQC is reaching out to HME providers in key states to sign similar letters to their senators. One provider that already has: Waterbury Medical Equipment Supply in Connecticut has gathered more than 100 signatures of beneficiaries and community members in support of the market-pricing program (MPP). PFQC plans to send that letter to Connecticut senators this week.

OIG: Bidding could reduce glucose strip costs

WASHINGTON - The Office of Inspector General (OIG) last week recommended that Ohio implement a mail-order competitive bidding program for diabetes test strips, or use manufacturer rebates to save money. In a report issued last week, the OIG said do so could have saved approximately $8 million for the state fiscal year 2011. The OIG looked at Medicare payment rates in two Ohio CBAs and Medicaid payment rates that Indiana obtained through manufacturer rebates. The average Medicare payment rate for 50 test strips in the two Ohio CBAs in 2011 was $15.42, the net cost after rebate in Indiana was $17.72 and $14.70, and the Ohio Medicaid maximum reimbursement rate was $35.00. To read the full report: