Senate, House debate cap rental option for DME

Sunday, November 27, 2005

WASHINGTON - It's a "definite maybe" that Senate and House members will settle their differences this year over whether Medicare should eliminate the capped rental option for durable medical equipment.

Senate leaders have proposed eliminating the capped rental option for home medical equipment as a way to shave about $900 million from the 2006 Medicare/Medicaid budget.

House members did not include the proposal in their spending bill, which tackles only Medicaid spending. The two bodies of Congress must now compromise on a final spending plan.

Senate and House members broke for a holiday recess last week and aren't scheduled to return to Washington until early to mid-December. Upon returning, members will attempt to settle their differences and craft a compromise Medicare/Medicaid spending plan.

Will they succeed this year? It's a "definite maybe," said Cara Bachenheimer, Invacare's vice president of government relations.

"There are so many massive differences in the two packages that conference will be difficult at best," Bachenheimer said. "It makes it a lot more time consuming for them to come to an agreement."

If legislators can't agree on a final plan before Christmas, they'll renew discussions upon returning to Washington in late January.

Under the Senate proposal, for DME in the capped rental category, after a 13-month rental period, the supplier would transfer the title for the item to the beneficiary. The option for a supplier to retain ownership of the item after a 15-month rental period would be eliminated.

By eliminating the capped rental option, providers would automatically lose two months of reimbursement per item (the 14th and 15th months), as well as the twice-yearly maintenance-and-service fee they receive for servicing capped items. The maintenance fee equals one-month's rental. Providers would also lose the equipment and not be able to integrate it back into their fleet once the patient no longer needs it.

In their scramble to find savings, some senate staffers, relying on a 2002 OIG and CMS report, believe the maintenance fees are unnecessary and should be eliminated.