New PMD benefit causes "huge underutilization'

Sunday, May 6, 2007

YARMOUTH, Maine - Recently released claims data may support the argument that CMS's new codes, coverage criteria and pricing for power mobility devices, which went into effect Nov. 15, has decreased access, industry sources say.

In all jurisdictions, the number of submitted and allowed claims for standard power wheelchairs dropped an average of 25.7% and 26.2%, respectively, from October to November, according to data obtained by HME News from the SADMERC through a Freedom of Information Act request. (The SADMERC takes about four months to collect all claims for a given month.)

The largest drop took place in Jurisdiction B, where providers submitted 28.3% fewer claims and CMS allowed 29.5% fewer claims from October to November. CMS's approval rate remained relatively stable at 91.9% and 90.3%.

The number of submitted and allowed claims dropped 22.9% and 23.5%, respectively, in Jurisdiction A; 27.7% and 26.8% in Jurisdiction C; and 24% and 24.9% in Jurisdiction D.

The drop didn't surprise industry sources. The uncertainty surrounding the revamped PMD benefit--spurred, in part, by numerous revisions--caused providers to hold back some claims, they say.

"There's a transition period where providers aren't sure what they can and can't provide," said Don Clayback, who heads up The MED Group's National Rehab Network.

The number of claims should bounce back in December and January, industry sources say, but there could be "some permanent drop due to continued complexities," Clayback said.

(When CMS implemented new documentation requirements for PMDs Oct. 25, the industry noticed a similar drop--and subsequent rebound--in claims. See HME News June 2006).

Doug Harrison, founder and CEO of The Scooter Store, believes the new codes, coverage criteria and prices have resulted in "a huge underutilization." CMS stated in 2005 that appropriate utilization for PMDs was 187,000 units per year (about 15,500 per month). When adjusted for demographic growth, that figure increases to about 200,000 units per year (about 16,600 per month) in 2006 and 214,000 units per year (about 17,800 per month) in 2007. Based on estimates from manufacturers, however, the industry has provided only between 13,000 and 14,000 units per month from November 2006 through early 2007, Harrison said.

"There's some pointy-headed little bureaucrat at CMS who will say, 'That means we'll save money on 4,000 units,'" Harrison said. "The truth is, reduced utilization will cost Medicare much more than they'll save in falls, fall-related injuries and hospital stays. It's penny wise and pound foolish."

Industry sources say national competitive bidding, which kicks off April 2008, could also impact the number of submitted and allowed claims, reducing access even further.

"The real interesting months will be April through June," said Jerry Keiderling, vice president of The VGM Group's U.S. Rehab. "There'll be another valley, because people will be so busy forecasting the future, and then who knows what."