President touts savings from bid program

Budget also includes provisions related to how oxygen is paid for and how Medicare appeals are handled
Wednesday, February 10, 2016

WASHINGTON – The president’s proposed federal budget for fiscal year 2017 includes a provision to expand Medicare’s competitive bidding to new product categories.

The budget proposes that inhalation drugs; all prosthetics and orthotics; and ostomy, tracheostomy and urological supplies, all be included in the program.

“Since implementation, the competitive bidding program for durable medical equipment, prosthetics, and supplies has saved the Medicare program and beneficiaries billions of dollars by aligning payment amounts with market-based prices,” the budget states.

Expanding competitive bidding to these additional product categories would save $3.8 billion over 10 years, the budget states.

The budget also proposes eliminating the 36-month cap for oxygen equipment and, instead, reducing the monthly payment amount for oxygen and oxygen equipment by the necessary percentage to be budget neutral, according to AAHomecare’s analysis.

Another provision in the budget: Extend the authority to require prior authorization to all Medicare fee-for-service items and services, particularly those that are at the highest risk for improper payment. This would save $75 million in 10 years, the budget states.

A number of provisions in the budget are related to the Medicare appeals process, according to AAHomecare. They include:

·      Provide Office of Medicare Hearings and Appeals and Departmental Appeals Board Authority to use Recovery Audit Contractor collections.

·      Establish a refundable filing fee.

·      Establish magistrate adjudication for claims with amount in controversy below new administrative law judge amount in controversy threshold.

·      Expedite procedures for claims with no material face in dispute.

·      Increase minimum amount in controversy for administrative law judge adjudication of claims to equal amount required for judicial review.

·      Remand appeals to the redetermination level with the introduction of new evidence.

·      Sample and consolidate similar claims for administrative efficiency.