Industry now has full view of bid pricing

Wednesday, November 25, 2015

WASHINGTON – CMS last week released revised fee schedule amounts for 11 product categories in non-bid areas as part of its upcoming national roll out of competitive bid pricing on Jan. 1, 2016.

CMS has developed fee schedule amounts for non-bid areas in two ways: the average pricing in the competitive bidding areas in the region for regional areas; and the national weighted average plus 10% for rural areas.

For oxygen concentrators, for example, that means a 24% reduction in reimbursement, on average, for regional areas and a 22% reduction in reimbursement, on average, for rural areas.

CMS plans to phase-in new pricing over six months. Starting Jan. 1, pricing will be based on a 50/50 blend of the current and adjusted rates. On July 1, it will be based only on the adjusted rates.

Using oxygen concentrators as an example again, providers are paid $1,086, on average, for six months under the current rates. Starting Jan. 1, they will be paid $822 for six months in regional areas and $850 in rural areas.

Last month, CMS released a preliminary list of zip codes that it considers rural to distinguish those areas that will receive the 10% bump in reimbursement.

Average reductions from 2015 to 2016 for other popular HME are:

·      CPAP, 27% in regional areas; 25% in rural areas

·      Hospital bed, 24% in regional areas; 21% in rural areas

·      Power wheelchair, 25% in regional areas; 23% in rural areas

In a bulletin to its members following the announcement, AAHomecare stated: “(We) will full analyze the 2016 rates and will provide additional information shortly.”

In a bulletin to its members, The VGM Group included a link to a presentation it has prepared explaining and outlining the new pricing.

In a bulletin to its members, NCART confirmed that the new pricing includes reductions in reimbursement to accessories for complex power wheelchairs. Executive Director Don Clayback urged stakeholders to use the new pricing as a talking point with legislators to drum up support for bills in the House of Representatives and the Senate that would provide a technical correction preventing CMS from applying competitive bidding pricing to these accessories on Jan. 1.

The industry has also succeeded in getting a bill introduced in the Senate recently that would soften the blow of competitive bidding by, among other things, providing a 30% increase in reimbursement in rural areas and a 20% increase in regional areas. It expects a similar bill to be introduced in the House this week.