Part D: Mixed bag for infusion market
Opinion differs on the effect the Medicare Part D drug benefit has had on the M&A market for home infusion businesses.
"Some buyers are fearful of it, but others seem to be embracing it," said Jonathan Sadock, a managing partner with Philadelphia-based Paragon Ventures. "The goal of Part D was to increase access. If it does that and the rates are reasonable, then it's another channel of revenue."
However, because Part D covers drugs but none of the professional services that go into providing home IV therapy, those rates aren't exactly considered "reasonable" by infusion providers, say insiders.
"There isn't a dispensing fee that encapsulates the extraordinary amount of service that home IV requires," said Dexter Braff, president of Pittsburgh-based The Braff Group. "It has not been the boon to utilization that people had hoped."
Braff said he was optimistic that corrective legislation would go a long way toward fixing the benefit. One bill making the rounds is the Medicare Home Infusion Consolidated Coverage Act of 2006. Originally introduced last July, H.R. 5791 now has 40 co-sponsors, including House majority whip Roy Blunt, R-Mo. The bill would ensure coverage of infusion supplies, services and drugs under Medicare Part B.