HME continues to pop up in deficit reduction talks

Thursday, September 22, 2011

WASHINGTON - The Medicare Payment Advisory Commission (MedPac) and the president made recommendations last week to the Congressional "supercommittee" charged with coming up with a plan to shave at least $1.2 trillion from the deficit over 10 years. Two of their recommendations: Leverage competitive bidding for further savings and implement prepayment reviews for all power wheelchairs.

MedPac's "draft list" of recommendations, which represents a total of $233 billion in savings over 10 years, includes: "Apply the competitive bidding offset to all competition-eligible DME categories starting in 2012" for $2 billion in savings over 10 years; and "Apply the competitive bidding offset to the DME categories never subject to competitive bidding" for $8 billion in savings over 10 years.

Another recommendation: "Additional reductions through competitive bidding or fee schedule reductions to payments for home oxygen" for $5 billion in savings over 10 years.

MedPac's recommendations raised a number of questions for industry stakeholders. In its first and second recommendations, for example, for what geographical areas?

"It's not good news," said Cara Bachenheimer, senior vice president of government relations for Invacare. "But for a lot of these, we just don't know what they're talking about."

In fact, some of the recommendations and savings may be, at least in part, already implemented and realized, stakeholders say.

"Some of these recommendations come from a June 2003 report from MedPac," said Seth Johnson, vice president of government affairs for Pride Mobility Products. "These recommendations are dated and don't reflect what's already in place."

MedPac has scheduled a meeting for Oct. 6 and 7 to discuss the recommendations. Stakeholders expect a packed house, not only because of the nature of the recommendations but also because of the fact that MedPac's making recommendations at all.

"From a big picture perspective, people in the healthcare community are completely outraged," Bachenheimer said. "MedPac's mission is to make policy recommendations to Congress and they're taking the unprecedented step of saying, 'Here's $233 billion in savings,' and putting all providers on the chopping block."

Both MedPac and the president recommend requiring prepayment reviews for all power wheelchairs for $200 million in savings over 10 years (MedPac's estimate). The president's recommendations, which represent a total of $248 billion in savings over 10 years, also include: "Limit federal reimbursement for a state's Medicaid spending on certain DME services to what Medicare would have paid in the same state for the same services" for $3 billion in 10-year savings.

Congressional committees with jurisdiction, like the House Ways and Means Committee, will also make recommendations to the "supercommittee." It will likely be more of the same, stakeholders say.

"You've got the administration and CMS touting competitive bidding and now you've got MedPac touting competitive bidding," said Wayne Stanfield, president and CEO of NAIMES. "What impact will this have on the 'supercommittee'? You can bet that DME is going to be hit in some way."