O2: Is it a service or a supply?

DETROIT - Are the Department of Veterans Affairs and Medicare singing different tunes when it comes to the importance of service in providing home oxygen therapy? They might just be, said industry sources. Congress recently passed a 36-month cap on Medicare oxygen reimbursement that, industry sources say, downplays services like patient assessments. The VA, on the other hand, has been fighting to keep its contracts service-oriented. This spring, Rotech Healthcare protested several VA contracts, arguing that they're mainly supply--not service--contracts (See story page 23). "We have one department within the government--the VA--recognizing the need for good, quality service and building that into their contracts," said Jim Frederick, the compliance officer and director of clinical services for Mitchell Home Medical in Ypsilanti, Mich. "Then we have another department within the government--Medicare--doing just the opposite." Another provider added: "It's like the left hand is doing the opposite of what the right hand is doing," he said. The VA contract Mitchell won and that Rotech protested includes service requirements that are "directly in line with a lot of the JCAHO standards," Frederick said. For example: Patient contact every 90 days, customer satisfaction reports, etc. If Rotech's protests fail, it could solidify the industry's argument that providers do a lot more than deliver equipment. "This has a far-reaching impact on how we're recognized as oxygen providers," said Larry Loewen, Mitchell's former vice president and COO.