Scully: industry can fine-tune or slow down but not stop NCB

Sunday, June 12, 2005

WASHINGTON -- Tom Scully, the former CMS Administrator who now works on HME industry issues as an AAHomecare consultant, threw a wet blanket last Wednesday on industry hopes that competitive bidding is not inevitable.

Scully said the industry could fine-tune the controversial reimbursement initiative, or slow it down. But "telling them (Congress) to back off is unlikely," said Scully, speaking at AAHomecare's annual legislative conference in D.C.

Scully's sobering remarks come in the wake of a recent conference call by members of state HME associations who are dissatisfied by the way AAHomecare is handling the fight against competitive bidding. Scully's remarks reinforce the notion that competitive bidding is a fait accompli.

Indeed, Scully suggested that backing off competitive bidding was antithetical to the politics that drove the Medicare Modernization Act in 2003. He said the same poltics that spawned the MMA are the same politics that view competitive bidding as government price-fixing.

"They (the government) think it's counter-intuitive to not do competitive bidding," Scully said.

As a template for successful politicking on the issue, he pointed toward the Muse study on the costs associated with the delivery of respiratory medicine. "You did really very well on this issue," Scully said.

The MMA called for a reconstruction of the methodology used to pay for respiratory medications such as albuterol and ipratropium. The MMA pegged reimbursement for ASP plus six percent, but the industry's agitation on the subject pushed CMS to implement a $57 dispensing fee for respiratory meds.

On Medicaid, Scully called the program "unreformable" and said the best that could be hoped for was some tweaking here and there.

"Medicaid is 100 times more screwed up than Medicare will ever be," he said.

Scully also believes that as many as a half of all Medicare beneficiaries will migrate to PPO plans in five years. Currently, 89% of Medicare beneficiaries are insured by the traditional plan, which pays reimbursement off a fee schedule; 11% of beneficiaries are enrolled in Medicare HMOs.