Look ahead: Many issues unresolved

Saturday, September 30, 2006

This is the time of year you begin to look ahead to finalize next year's plan for your businesses. Not an easy task when so many of Medicare's reimbursement policies remain unsettled. It is also not surprising that this year's scorecard of issues is not that different from last year's; and while there has been progress on some fronts, there are new issues to consider as well. In addition to the rollout of competitive bidding, standards and accreditation, and the revamping of coding, coverage and payment for power mobility devices, this year you must also factor into your business plans the transfer of ownership for capped rental DME and oxygen equipment. There are also bills pending now that could impact the implementation of these initiatives.
National Competitive Bidding (NCB)
CMS published a notice of proposed rulemaking (NPRM) earlier this year. As expected, the proposal did not identify the areas or the products that would be subject to competitive biding, although the NPRM did reveal what is likely to be the footprint for the bidding process. The areas and products will be identified when the final rule is published later this year or early next year.
HME providers have increased their legislative activity surrounding competitive bidding. The tally at press time shows that the Hobson-Tanner bill, HR 3559, now has 139 co-sponsors. Another important development in this area is legislation introduced earlier this year by Representative Ron Lewis (R-KY). The House bill, HR 4994, would carve out from competitive bidding complex rehab and assistive technologies.
Accreditation and Quality Standards
There has been more progress on the development of standards and accreditation for DMEPOS. This summer, CMS published the final DMEPOS quality standards. In a surprise, CMS consolidated over 100 pages of standards from the proposal it published in 2005 into 14 pages. The challenge now is how these new standards will be interpreted and applied by CMS and the accrediting bodies. CMS still must select accrediting bodies to administer the standards. At press time, that was in progress. CMS is expected to announce its selections by the end of the year. Although all HME providers will eventually need to be accredited in order to bill the Medicare program for DMEPOS, providers in competitive bidding areas will be required to be accredited first.
Forced beneficiary Ownership of Oxygen Equipment and DME
Everyone should know that effective Jan. 1, 2006, the Deficit Reduction Act of 2005 (DRA) forces Medicare beneficiaries to own their oxygen equipment after 36 months of continuous use and capped rental DME after 13 months. This summer, CMS issued a proposed rule implementing these DRA provisions. The proposed rule would revise payment for oxygen equipment based on the technology for the equipment.
HME providers have been actively voicing their concerns against this policy. This year, companion bills were introduced in the House and the Senate that would repeal forced ownership of oxygen. The Home Oxygen Patient Protection Act, HR 5513, was introduced in the House by Representative Joe Schwarz (R-Mich.) on May 25, 2006. The Senate companion bill, S 3814, was introduced by Senators Pat Roberts (R-Kan) and Jack Reed (D-R.I.) on Aug, 3, 2006. The list of co-sponsors for these bills keeps growing, a reflection of the HME community's hard work on these issues.
Coding, Coverage, and Payment for Power Mobility Devices
The CMS initiative to revamp coding, coverage, and payment for power wheelchairs that began with "Wheeler Dealer" continues to unfold. At press time, providers face an Oct. 1, 2006 implementation date, but many issues remain unresolved. CMS issued new HCPCS codes, but there are discrepancies in the product classification list based on the information that manufacturers submitted with their coding applications. Also, CMS has yet to publish fee schedules for the new codes. In August, CMS released for comment a pricing survey for the new codes that included Internet retail pricing, raising concerns that reimbursement for the new codes would not be sufficient to account for the services Medicare requires providers to furnish. Importantly, the final power mobility local coverage determination (LCD) that was issued in August severely restricts coverage for almost all power mobility devices except for the cheapest products. Providers have been working hard along with the American Association for Homecare (AAHomecare) and consumer organizations to obtain a delay in the implementation of these policies so that appropriate payment and coverage for these devices can be established.

Finally, a related development in this area is the introduction of legislation to fix the "in the home" restriction on coverage for power mobility devices. The Medicare Independent Living Act, S 3667, was introduced by Senators Bingaman (D-N.M.) and Santorum (R-Pa.) in July. The bill would increase access to community activities for Medicare beneficiaries who require power mobility devices by modifying the outdated "in the home" restriction for DME under Medicare.

As you can see, practically every HME product line will be affected by these policies. All providers would be well served to stay informed of further developments and by becoming actively engaged in shaping the outcome of these initiatives. Information on all of these issues is available from AAHomecare. Contact the association to learn how you can become involved.


Healthcare attorney Asela Cuervo is the principal in the Law office of Asela M. Cuervo in Washington D.C.