Swimming upstream against downstreaming

Wednesday, April 30, 2003

YARMOUTH, MAINE — A group of 22 New Jersey providers have formed a coalition and hired an attorney to help them get their fair share of referrals from the state’s hospital systems.

“There is supposed to be freedom of choice but the hospital case managers don’t follow it,” said a member of the Coalition of Independent Medical Equipment Dealers (CIMED). “It’s been a festering situation for the last 10 years but seems to have gotten particularly bad the last three or four years.”

To avoid being blackballed by the hospital systems, CIMED members requested that their names not be used.

In the practice known as downstreaming, hospitals and hospital systems funnel the majority of their discharged patients who need HME — or some other homecare service — to companies they own or with whom they have preferred-provider relationships. CIMED members estimate that in New Jersey that happens 80% of the time.

“That is an outrage,” said one CIMED member. “It is bad for the whole system. You are not respecting choice and you are restricting competition. If the guy doesn’t have to compete for the business, how good does he have to be.”

The coalition is waiting for resolution on a complaint it filed with CMS against one New Jersey hospital system.

Downstreaming is not a new problem by any means, but providers can prevail, said attorney Neil Caesar, president of the Health Law Center in Greenville, S.C.

“I’ve had success going to the (hospital) legal department,” Caesar said. “I’ve had success going to the compliance officer. I’ve had success helping my clients mount a behind the scenes political campaign.”

That said, there’s plenty of ways for a hospital to “load the dice so that they get most of the business and you really can’t do anything about it.” HME