Medicare resumes O2 payments

Monday, January 31, 2005

WASHINGTON - Providers got a dose of good news Jan. 13 when CMS announced that it would continue to reimburse them at the 2004 rate for home oxygen and services. That’s an about face from a Dec. 15 notification. At that time, CMS said it planned to withhold 2005 oxygen claims until the OIG provide additional information on which to base reimbursement cuts - as mandated by the Medicare Modernization Act of 2003.

CMS expected the OIG information by Jan. 15.

In its January announcement, CMS stated: “We now understand that we will not be receiving the OIG information by January 15, 2005; therefore, we have decided to stop holding oxygen claims and to begin paying claims with 2005 dates of service based on the 2004 Medicare fee schedule amounts. These are the rates that would have otherwise been in effect. Once the OIG information is received and the 2005 fee schedule amounts are calculated, all claims received with dates of service on or after January 1, 2005, will be paid using the 2005 fee schedule amounts. Claims with dates of service on or after January 1, 2005, that were paid using the 2004 fee schedule amounts will not be retroactively adjusted after the 2005 fee schedule amounts are implemented.”

News of CMS’s decision not to withhold payment eases provider worry about cash flow.

“My hat’s off to all the folks who burned the wires to their congressmen,” said John Gallagher, VGM’s vice president of government relations. “In my talks with CMS, they said they had been getting calls from lawmakers or their staff questioning why they were holding reimbursement and more importantly, what impact it was going to have on beneficiaries.”