Together, we can position HME as a constructive answer

Wednesday, September 30, 2009

After 30 years in the industry, and despite our reimbursement challenges, I still enjoy the dynamics of building Invacare and improving the HME industry's reputation with our government.

There are powerful, large forces at play in healthcare reform, from hospitals to physicians to insurance companies to pharmaceutical firms. Representing less than 2% of total Medicare spending, the HME industry is a small voice in a loud choir, but our message is ringing louder than ever. In the past, we've struggled to speak together on the issues facing our industry as a whole. It is more important than ever that we speak with one voice on the benefits of home care. We are beginning to do so and must continue this push. We all know that home care is patient preferred (everyone dreams of going home), it produces better clinical outcomes and it's one-sixth the cost of institutionalized care. Our message is starting to resonate with key government officials. None more key than President Barack Obama himself, who extolled the benefits of home health care at a town hall meeting in Shaker Heights, Ohio, on July 23, 2009, saying "I actually think home care ends up being cost-efficient in many cases, rather than institutional care, and it helps keep people in their homes."

The president is not alone in his position. It was echoed by Tom Daschle (a former leader of the U.S. Senate), who is vocal about his belief that instead of the proposed cuts in Medicare payments for home health services that can be found in some health bills, there should be an increase. He was quoted at a meeting of congressional staff saying, "My mother's quality of life is 100 times better given the fact that she can live at home rather than be institutionalized at 86."

Home care is a solution, not a cost to be cut, yet we are still facing possible payment cuts. The industry has come together to produce, with other stakeholders such as pulmonary physicians, a plan to reform how Medicare pays for oxygen. The plan would address the government's traditional focus on oxygen as an equipment-only benefit rather than one that requires significant services. Our mission is to ensure that our collective group of stakeholders can lead the reform effort on Capitol Hill, rather than have arbitrary payment cuts imposed on the benefit.

Then there's national competitive bidding--what I feel is the largest issue facing our industry. CMS has been steadily moving forward with this program over the last few months, releasing details along the way. While the scheduled January 2011 implementation date may seem far away, the bidding window starts this month. Well before year's end the bid window will be closed. Therefore, now is the time to ensure your bids are thoroughly researched and submitted completely and timely. Invacare continues to engage in conversations with CMS, Congress and the administration, urging concrete improvements in the bid system (for example, better financial evaluation of bidders) and pushing to minimize the numerous flaws we experienced in the 2008 bid process, particularly related to small businesses. During the last round of competitive bidding, 80% of small businesses were eliminated. In these tough economic times, artificially eliminating competition in the marketplace hardly seems like sound public policy.

Despite our challenges and concerns, the HME industry has much reason for optimism. The fundamentals of the industry are strong. Demographics are on our side, with baby boomers poised to be the future of home care. The government projects there will be 72 million people over 65 by 2030. As this population grows, so does the need for our products and services.

We've learned from experience that we must work together and with the government to ensure that the best policies are in place. There is more awareness of the benefits of home care than ever before, and we must continue to position our industry as a constructive answer--together. hme

Mal Mixon is chairman and CEO of Invacare.