In brief: CMS dumps loan closet provision, sets agenda for PAOC meeting

BALTIMORE - CMS has rescinded a provision that would have essentially prohibited an HME provider from maintaining inventory at a location owned by a physician, AAHomecare reported last week. The provision was set to go into effect March 2. "This means the current rules governing consignment closets under Medicare are still in place," the association stated in a bulletin to members. Under the provision, the title to HME would have to be transferred to the enrolled practitioner at the time it was furnished to the beneficiary and the practitioner would have to bill using his or her own billing number. Industry stakeholders warned CMS officials that the provision would be impractical and would likely violate the Stark law, which states that a physician can't refer beneficiaries to entities furnishing "designated health services," including HME, if the physician has ownership or a compensation agreement with the entity.



On the PAOC agenda: Round 2 timeline

BALTIMORE - CMS last week released an agenda for its next Program Advisory and Oversight Committee (PAOC) meeting on national competitive bidding. Topics for the Feb. 23 meeting include "Round 2 tentative timeline" and "Subdivision of MSAs for NYC, Los Angeles and Chicago." CMS expects to open registration for the meeting this week. FMI: http://www.cms.hhs.gov/DMEPOSCompetitiveBid/.



Obama spares HME in budget

WASHINGTON - There appear to be "no major cuts or policy changes" for HME in President Barack Obama's proposed 2011 budget, industry stakeholders reported last week. However, the budget does include an increase in funding to fight healthcare fraud. HHS documents state: "The budget includes $561 million in discretionary resources, an increase of $250 million, to strengthen Medicare and Medicaid program integrity activities, with a particular emphasis on fighting healthcare fraud in the field, increasing Medicaid audits and strengthening program oversight with reducing costs." Also, cuts and policy changes for HME are still in play as part of healthcare reform, stakeholders point out.



CMS projects health expenditures for 2009-2010

WASHINGTON - CMS projects that national health expenditures grew 5.7% to $2.5 trillion in 2009, up from 4.4% in 2008, according to a report prepared by the agency's Office of the Actuary and published online by the journal Health Affairs. In comparison, the gross domestic product (GDP) is projected to have decreased 1.1% in 2009. The growth in health expenditures was due, in part, to faster spending for the Medicaid program (a projected 9.9% in 2009, up from 4.7% in 2008). CMS projects that the growth in health expenditures will decrease to 3.9% in 2010, largely due to a 21.3% reduction in Medicare physician payment rates. Health expenditures are expected to grow 4.7% if that reduction doesn't go into effect.



Invacare pays down debt big time

ELYRIA, Ohio - Net sales for Invacare's North American HME products increased 0.9% to $748.4 million in 2009 compared to $741.5 million in 2008, the company reported Feb. 4 in its year-end financial report. Overall, Invacare's net sales for 2009 decreased 3.6% to $1.69 billion, due mainly to decreases in foreign currency exchanges. Invacare ended the year with $321.6 million in outstanding debt compared to $478.8 million in 2008. The company decreased its debt thanks to improved cash flow from operations ($141.6 million compared to $59.9 million in 2008) and by using cash already on hand. "(Invacare) plans to use its projected strong free cash flow in 2010 of $65 million to $75 million to continue to retire debt or pursue accretive acquisitions as available," stated CEO Mal Mixon.



Brightree travels with Passport

FRANKLIN, Tenn. and LAWRENCEVILLE, Ga. - Passport Health Communications and Brightree have teamed up to provide patient insurance eligibility verification as an integrated service within Brightree's business management software. Verifying coverage and benefits prior to service or product delivery increases the speed and accuracy of billing, reduces rejections and denials, improves staff productivity and increases cash flow, the companies stated in a release. "We anticipate our partnership with Passport will save hundreds of man hours by allowing providers to check patient insurance eligibility within the Brightree system," said Brightree President and CEO Dave Cormack.



Japanese firm to buy HDI

FORT LAUDERDALE, Fla. - Diabetes device maker Home Diagnostics Inc. (HDI) has agreed to a $215 million buyout from Japanese medical device maker Nipro, it announced Wednesday. The deal will allow Nipro to expand its diabetes-related business. The deal is expected to be finalized by the end of the current quarter.