Rehab industry: Increases a step in right direction

Sunday, November 12, 2006

WASHINGTON - Lobbying efforts by the rehab industry paid off with "significant" reimbursement increases for some Group 2 and Group 3 power wheelchairs.

CMS released a refined fee schedule Nov. 11 for power mobility devices after industry officials said the rate of inflation used to determine pricing was inconsistent with the rate used for other PMDs.

"CMS addressed a lot of the changes we had been communicating with them about," said Don Clayback, who heads up The MED Group's rehab network. "There were significant problems and they've made corrections."

The reimbursement for the Group 2 standard power wheelchair (K0823) increased by $301 dollars or 8%, compared to the fees announced in October.

Eric Sokol, director of the Power Mobility Coalition, said the bump was welcome but it's not enough.

"If these prices go into effect, the reimbursements aren't going to cover the costs of these (providers)," said Sokol. "They'll have to either stop participating in the Medicare program, concentrate on other products or close their doors."

For group 3 chairs, reimbursement increased 46% for the K0856 single power wheelchair, said industry leaders. Other wheelchairs saw increases of as little as 1%.

"We can live with that," said Tim Pederson, vice chairman of AAHomecare's rehab council and CEO of WestMed Rehab in Rapid City, S.D. "We were on the verge of stopping provision of these services for Medicare beneficiaries come the 15th. Now we don't have to do that."

While pleased with this step in the right direction, rehab leaders said there is more work to be done.

"Is there anything we can do other than the fee schedule itself," said Jerry Keiderling? "Can we work on the LCD some more? The coverage criteria and documentation requirements? The work in process is still there."

According to CMS, here's how the agency refined the fee schedule:

Refinements to the New Fee Schedule
* CMS is now using the Aug. 23, 2006 product classification list and pricing database generated by the SADMERC. The Aug. 23 classification list is the most current database that reflects the full and complete manufacturer applications, test results, and attestation, consistent with CMS' published requirements, and has undergone a thorough review by CMS and the SADMERC. Our comprehensive review found that later versions of the database do not meet these requirements, and so are less reliable and may reflect faulty data and attempts to manipulate prices. Examples of key data improvements include--

* Certain PMDs with questionable test-results that are produced off-shore are now eliminated from the calculations.

* CMS has ensured that data submissions by manufacturers related to PMDs (and MSRPs) that are merely under development and not yet being produced are not included in the pricing database. Some manufacturers submitted data regarding chairs that have not yet been produced and distributed but are merely design concepts for chairs potentially under development. Some believe these chairs are slated for production off-shore. Since the product was not available, testing and application results are not verifiable and, therefore, these products have been eliminated from the list.

* Undocumented test results and incomplete applications submitted without the proper attachments and attestation are now excluded.

* The new coding set "bundled" certain basic equipment requirements into the codes based on the clinical needs of beneficiaries. Some manufacturers did not include all elements of the basic equipment package as bundled features in the MSRP submitted for the code. As part of its detailed review, CMS corrected manufacturer's suggested retail price (MSRP) data by adding the value of these items to ensure that prices for certain basic equipment (e.g., seat belts, adjustable, foot plates, solid-fill tires) that were supposed to be included in the data submissions are now reflected in the fees.

* In calculating the new fees, CMS revised the formula to more accurately reflect the year of submission of the MSRP data. As part of the gap filling formula and calculation, we deflate the current MSRP back to price levels in the base year of the fee schedule (1986). By more accurately reflecting earlier MSRP starting dates, the number of years of deflation in the gap-filling process was decreased, resulting in an upward effect on the final fees. (Please note that CMS later applies the appropriate inflation updates to the base year amount.)

* In calculating the new fees, CMS ensured inflation of the data from the base year for the fee schedule to the present was based on uniformly applied inflation factors reflecting the updates mandated by Congress. This resulted in increases for two fees.

* CMS also ensured that anomalies in pricing that resulted from a lack of data for certain codes were corrected using data for comparable products. For example, CMS ensured that heavy weight PMDs were not priced lower than standard weight PMDs.

* CMS also withdrew fees for group 4 (high activity) and group 5 (pediatric) PMDs from the fee schedule since these are items that would rarely, if ever, be covered by Medicare.

The results of their refinement:

* The changes to the fee schedule will improve the accuracy of Medicare payments for mobility technology.

* Prices for complex rehabilitation (Group 3) PMDs used by the severely disabled will increase significantly compared to the fees released in October. They will now be at a level consistent with fees based on manufacturer suggested retail prices for products verified to be group 3 products based on complete code verification requests as of Aug. 23, 2006.

* The fee for the most commonly provided standard geriatric mobility (Group 2, standard weight captain's chair) PMD increased by $301 compared to the fees announced in October.