Oxygen guidelines knock wind out of providers

Sunday, November 2, 2008

WASHINGTON - The HME industry's worst fears were realized on Friday when CMS released long-awaited guidance for providing oxygen after the 36-month cap.

For patients who cap out Jan. 1, providers must continue to provide emergency services, as well as supplies, accessories and repairs, for no further payments for the "useful five-year life of the equipment," CMS states.

"We are alarmed with the direction CMS has taken," said Walt Gorski, vice president of government relations for AAHomecare "We believe that, once again, CMS is discounting the level of service that providers now furnish to their patients for their oxygen service."

The guidance is part of a 1,459-page final rule for the Medicare Physician Fee Schedule for 2009. A comment period will last 60 days.

After the cap, CMS will continue to pay for oxygen contents for liquid or gas, and for routine, in-home maintenance and service once every six months. The routine maintenance payments are in effect for 2009 only.

"They are going to pay it for this year, but they want comments on whether that's adequate or if they even need to pay it at all," said industry attorney Asela Cuervo. "It's not a lot of money."

Maintenance payments vary across the four Medicare jurisdictions but average about $25 to $30, according to Cara Bachenheimer, Invacare's senior vice president of government affairs. Costs are $60 to $75, she said. Repairs and parts are not covered because they are considered an asset of the provider.

"There is this expectation that because they've been paying you for three years that you've got the wherewithal and obligation to continue servicing the patient and equipment for no money whatsoever--zippo," Bachenheimer said.

One big question on the minds of providers: What happens when a patient relocates, either permanently or temporarily? Many providers have reported that they are already having difficulty finding anyone willing to take a patient nearing the 36-month cap.

The answer isn't good. CMS's position: It is the responsibility of the original provider to continue providing service or to find the patient a new one. Gorski calls this "unworkable."

"If the patient moves from Wisconsin to Arizona, the provider must make the arrangements," he said. "We just don't know how such a system will work."

In a September 2006 report, the Office of Inspector General found that only 22% of beneficiaries use oxygen for more than 36 months. CMS calculates, based on current fee schedules, that for those patients, the provider is paid $7,174.

Visit the CMS website at www.cms.hhs.gov/center/dme.asp to view the rule and obtain additional information.