Get ready for FEHBP reimbursement cuts

Sunday, October 31, 2004

November 1, 2004

ORLANDO, Fla. - A bill to repeal Medicare reimbursement cuts scheduled for 2005  has gained significant support in the House of Representatives but most likely won't be voted on this year.
That's the bad news. The good news is that, on average, the cuts to eight key DME items will average 40% less than expected, Cara Bachenheimer, Invacare's vice president of government relations reported Tuesday at Medtrade.
For example, CMS announced recently that reimbursement for nebulizers will be cut 14%, not 22%; power wheelchairs will be cut 3%, not 7%; and concentrators will be cut 11%, not 15%, Bachenheimer said.
The Medicare Modernization Act of 2003 mandated that CMS reduce reimbursement for the eight items based on Federal Employees Health Benefit Plans (FEHBP).
As of Friday, 104 representatives had signed on as co-sponsors of H.R. 4491, which would repeal those FEHBP cuts. The industry is still drumming up support for the bill, but don't look for it to pass before tomorrow’s election. It's also unlikely that a lame duck Congress will pass it after the election, Bachenheimer said.
"The bill is not dead," she said. "We can resurrect it next year, but in 2005, we will probably be focused on competitive bidding - coming up with alternatives and appealing to members of congress to make sure that it doesn’t happen."
In addition to FEHBP cuts, the MMA mandated that CMS role out competitive bidding in 10 metropolitan statistical areas (MSAs) in 2007. CMS has already assembled a competitive bidding advisory panel and by next spring expects to develop a proposed regulation that lists 10 possible MSAs as well as  products it wants to see included in the bid, Bachenheimer said.