Meds: Dispensing fee 'likely' to drop

Friday, September 30, 2005

WASHINGTON - A consultant for AAHomecare began circulating a survey to association members and non-members in August with the aim of gathering data that supports the industry's argument that CMS should not reduce the respiratory med dispensing fee in 2006.The surveys were due Sept. 6, and AAHomecare intended to submit the results to CMS by the Sept. 30 deadline.
CMS announced Aug. 1 that the 2006 dispensing fee "will likely be lower than the 2005 level" of $57 a month per patient. The announcement came as part of Medicare's proposed Physician Fee Schedule for 2006. The proposal included a 60-day public comment period.
In 2004, AAHomecare hired Muse & Associates to study the costs involved in providing inhalation drug therapy to Medicare beneficiaries. The study, the largest of its kind, concluded that if Medicare paid a dispensing fee less than $68.10 a month providers would lose money supplying two key drug therapies.
The new Muse survey, which was sent to 800 homecare providers of inhalation drug therapy, will update the 2004 data and address specific questions CMS posed in August when it announced a possible reduction in the dispensing fee for 2006.
CMS wants to know: what services inhalation therapy suppliers provide beneficiaries; the extent to which suppliers have shifted their shipping to ground services and away form more expensive carriers like UPS; efforts by providers to measure outcomes; and additional information on the typical dispensing costs for an efficient, high-quality supplier.
Rather than reducing the dispensing fee, providers say the fee should be increased to reflect the escalating costs of doing business, such as fuel and delivery costs and paying a pharmacist.
"We are alarmed that on the heels of a staggering 89% reduction in drug reimbursement in 2005, and in the absence of any new cost data or analysis, CMS is planning further reductions to the reimbursement for nebulized inhalation medications in 2006," said Peter Kelly, CEO of Pacific Pulmonary Services. "At minimum, we were anticipating a modest increase in reimbursement to offset for inflation, similar to what CMS recommended for providers of hospice care, acute care hospitals, inpatient rehabilitation facilities and skilled nursing facilities."