Stakeholders ready case for other payers to follow Medicare

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Friday, December 16, 2016

WASHINGTON – Industry stakeholders are looking into whether or not other payers should have to follow Medicare’s lead and retroactively delay reimbursement cuts that went into effect in rural areas on July 1.

Because so many other payers base their reimbursement on Medicare’s, shouldn’t they also have to allow providers to recoup six months of payments, from July 1, 2016, to Dec. 31, 2016, as outlined in the 21st Century Cures Act?

“When CMS dropped the fee schedule across the board on July 1, it caused Tricare rates to plummet, as most of those contracts were based on a percentage off the Medicare rate,” said Chris Smythe, vice president of Tycon Medical Systems in Norfolk, Va. “I would assume that if CMS changes the Medicare fee schedule back to its old rates during that time period, the Tricare rates will have to be adjusted as well.”

AAHomecare is trying to find out.

On the one hand, the association knows Medicare can’t tell other payers what to do.

“CMS never issues any guidance to other payers on what they should do,” said Kim Brummett, vice president of regulatory affairs for AAHomecare. “That would be up to the payer and the supplier.”

So AAHomecare is researching whether or not at least Tricare has an obligation to delay the cuts, because there is legislative language requiring them to follow Medicare reimbursement, says Laura Williard, senior director of payer relations for the association.

For Medicare Advantage and commercial plans, it would be more of a negotiation, Williard says.

“At this point, we are developing the strategy of what are possible discussions that can be had with these plans,” she said.

It sounds like a tall order, but AAHomecare is hot off a recent win in North Carolina, where it, along with the Atlantic Coast Medical Equipment Services Association, convinced Blue Cross Blue Shield not to apply the 2017 Medicare fee schedule update, which includes reimbursement based on the cuts going back into effect on Jan. 1, instead sticking to the 2016 fee schedule.

It’s all worth looking into as far as Smythe is concerned.

“For companies like ours, that serve a large Tricare population, even this six months of relief will be big,” he said.