GAO: Cover disposable devices as substitutes for DME

Health and Human Services calls move ‘premature’
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Wednesday, July 19, 2017

WASHINGTON – The Government Accountability Office has recommended that the Department of Health and Human Services evaluates the possible costs and savings of using disposable devices as substitutes for DME and, if appropriate, seek legislative authority to cover them.

While Medicare generally doesn’t cover disposable devices, the GAO identified eight such devices that could potentially substitute for DME devices that are covered. These disposable devices fall into existing Medicare DME categories: infusion pumps, including insulin pumps; blood glucose monitors; sleep apnea devices; and nebulizers.

The GAO’s recommendation is the result of a report examining (1) potential disposable DME substitutes and their possible benefits and limitations; (2) the incentives and disincentives stakeholders identified for developing these substitutes, including the possible influence of health insurance coverage; and (3) issues related to benefit category designation, including legal authority and potential payment methodologies if Medicare coverage were expanded to include disposable DME substitutes.

In addressing issues related to benefit category designation, the GAO identified three possible options for covering disposable devices: an expansion of the current DME benefit, an expansion of the current home health benefit, or the establishment of a new benefit category.

Under the current DME benefit, disposable devices are not covered because they don’t meet CMS’s regulatory definition for “durable”: able to withstand repeated use, with an expected lifetime of at least three years.

To conduct the report, the GAO reviewed agency documents and literature on disposable DME substitutes and Medicare payment policy; interviewed CMS officials; and interviewed various stakeholders, including representatives of device manufacturers, beneficiary advocates, healthcare providers and insurers for their perspectives.
In response to the report, HHS said it was premature to evaluate disposable devices as substitutes for DME.

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