Too little or big?

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Friday, October 31, 2003

Editor, HME News

Federal officials can’t have it both ways. You can’t, on the one hand, say you didn’t notice that claims for power wheelchairs were going through the roof because durable medical equipment hardly registers on your radar screen. And then, on the other hand, blame durable medical equipment (as well as outpatient hospital care and doctors’ services) for one of the largest increases ever in the Medicare premium, as The New York Times reported Oct. 16.

Next year, Medicare beneficiaries will pay a $66.70 per month premium, up 13.5% over the previous year.

In 2002, Medicare spent about $261 billion, according to a June 2003 report by the Medicare Payment Advisory Commission (MedPAC). Inpatient hospital services were by far the largest spending category (40%), followed by physicians (17%), skilled nursing facilities (6%), and home health (4%).

Medicare spent about $5 billion on DMEPOS in 2002. That represents less than 2% of the overall Medicare budget. So if power wheelchairs are so insignificant that the folks at CMS can’t catch the kind of wheeler dealer fraud that’s besmirched this industry, how is it that federal officials can blame activity within that smidgen of the Medicare as a driver for one of the largest premium jumps?

Smacks of politics, if you ask me.

By privatizing more of the Medicare program, according to CMS Admnistrator Tom Scully, beneficiaries will enjoy lower premiums and lower costs.

More privatization of the Medicare program would not be a welcome development for HME suppliers. In an HME NewsPoll we conducted last year, 85% of respondents said no to more privatiza-tion. That’s roughly the same percentage of Medicare beneficiaries who’ve said no to managed Medicare plans, choosing instead to remain in the traditional fee-for-service plan.

The privatization of Medicare is at the heart of the conference committee’s stalemate over a reform package. The House wants a lot more; the Senate wants a lot less.

Administrator Scully seems to think privatization is something of a panacea. It’ll control costs and reduce premiums, he thinks. It may do something to curb fraud and abuse, he claims, since private payers are more apt to follow the money than federal regulators.

Maybe, maybe not. But this is definitely true: Federal bureaucrats and contractors would pay more attention to taxpayer money if somebody was held accountable for the wheelers dealers.

Federal and DMERC officials have yet to provide any persuasive case for why they failed to catch the wheeler dealers of Harris County, Texas before they bled the Medicare program for more than $100 million .

Several heavyweights in Region C, including the medical director Paul Metzger, have announced resignations in the wake of the Wheeler Dealer scam. Palmetto and CMS say the resignations are strictly coincidental. Maybe they shouldn’t be. Maybe somebody should be held accountable for that $100 million snafu.

And maybe then there’ll be no cause to blame DME when the premiums go up.

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