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On the Editor's Desk

by: Liz Beaulieu - Friday, May 10, 2013

I get a kick out of the power some of our readers think I wield.

Just the other day, an HME provider called me and our conversation went something like this:

Provider: I’m looking at the May issue and there’s an article that says Round 2 may get delayed. When are we going to find out about that?

Me: Well, there’s a bill that has since dropped to replace competitive bidding with MPP, and the industry is now focusing all of its efforts on that.

Provider: What about the delay?

Me: A bill for the delay hasn’t been introduced. Before the bill for MPP was introduced, the industry was exploring that as another option to buy some time to get the bill for MPP introduced.

Provider: When will the bill for MPP get voted on?

Me: Well, I know the goal is to get it passed somehow—maybe as part of a larger piece of legislation—before July 1, when Round 2 is supposed to start.

Provider: Do you think that’s going to happen?

You get the idea. I really wish I had a crystal ball at times like these. Instead, I have a broken lucky eight ball that, when I shake it, always says, “As I see it, yes.”

Perhaps that should have been my answer to the provider’s last question? Here’s to hoping it’s true.

Recently, I had two providers call me on separate occasions and one called me “the big cheese” and the other called me “the boss.” My conversation with the first provider went something like this:

Me: Hello, this is Liz.

Provider: Theeeeeee Liz, the big cheese?

Me: That's me.

While we’re talking about cheese, if I had to name my favorite cheese, which is a hard thing for me to do, because I haven’t met a cheese I don’t like, it’d be goat cheese. Though, close behind goat cheese would be cheese curds. You can get these in most grocery stores these days, but they’re nothing like the kind you can get in Quebec.

Speaking of Quebec, that’s where my parents are from, and if you know that, you’ll have a good idea of how to pronounce my last name the next time you call. It’s French: Beau (nice) lieu (place). But in these neck of the woods, in Maine, they pronounce it Bowlier. Go figure.

Anyway, FYI, I wield very little power around here, especially over competitive bidding. If you want some real answers, ask Managing Editor Theresa Flaherty. She doesn’t eat cheese and her last name is easier to pronounce.

by: Liz Beaulieu - Thursday, May 2, 2013

For those of you uninitiated in the to-do list of an HME News editor, the first week in May is when she has to submit half a dozen or so Freedom of Information Act (FOIA) requests with the Pricing, Data Analysis and Coding (PDAC) contractor to update the HME Databank.

The Databank features a listing of the top Medicare providers by total reimbursement for 231 codes (Provider Share can be filtered by state, city or zip) and a listing of fee-for-service reimbursement for 426 codes included in competitive bidding (Product Share can be filtered by state and county).

We’ll update the Databank in September with 2012 data.

Each year for Provider Share, I keep a running list of code requests. We consider the 231 codes in there some of the most popular codes—you know, E1390, E0260, E0601, A4253 and K0823. So it was interesting to see that many of the codes that users have requested fall under urologicals, wound care, orthotics, ostomy and enteral.

Were the users requesting these codes already doing business in these markets and looking for data? Or were they requesting these codes looking to enter these markets and looking for data? I wish I had taken note.

We’ll add dozens of codes in these areas to the Databank as part of this year’s update.

Speaking of this year’s update, it should be pretty interesting. Last year, with the 2011 data, we got our first glimpse of the HME industry post-competitive bidding. Round 1 of the program went into effect Jan. 1, 2011. This year, with the 2012 data, we’ll have a better look at the continuous impact of competitive bidding on Medicare spend.

For Riverside County in California, one of the areas included in Round 1, Medicare spend for E1390 decreased from about $4.8 million in 2010 to about $3.3 million in 2011.

In Mecklenburg County in North Carolina, which includes Charlotte, Medicare spend for E1390 decreased from about $2.6 million in 2010 to about $1.7 million in 2011.

What happened in 2012?

Stay tuned.

by: Liz Beaulieu - Tuesday, April 23, 2013

A few folks that I talked to today were all abuzz about an announcement made by Sen. Max Baucus, D-Mont., that he will retire in 2014.

This is big news, obviously, with Baucus the chairman of the influential Senate Finance Committee, which, among other things, oversees Medicare and Medicaid. He’s also the sixth Democrat to announce his retirement, giving momentum to Republicans trying to retake control of the Senate.

But in our small universe called the HME industry, what does this mean? Is Baucus a friend or foe?

Sifting through our archives, Baucus popped up in a number of stories:

Baucus in 2010 had this to say about the, on average, 32% cut in Medicare reimbursement as part of Round 1 of competitive bidding: “Today we are seeing that transparency and competitiveness in Medicare results in a 32 percent reduction in costs, just from the first stage of this program alone. I’m very pleased with these strong results from making Medicare a more competitive and transparent purchaser and America’s seniors and taxpayers should be as well.”


Speaking of competitive bidding, Baucus in 2009 was the driver behind including a provision in the healthcare reform bill to expand the number of areas in Round 2 to 91.

Yikes squared.

And speaking of healthcare reform, he was also one of the drivers behind provisions to include a 2.3% tax on medical device manufacturers (most HME was left out) and to eliminate the first-month purchase option for power wheelchairs (that stayed in, and continues to be painful for providers).

But it hasn't been all bad.

Baucus (along with Sen. Charles Grassley, R-Iowa) went to bat for pharmacies in 2010, asking the Department of Health and Human Services to cut them some slack in meeting the accreditation requirement (they got it).

Baucus also went to bat for home infusion providers in 2009, admitting that Congress needs to do something about the lack of Medicare coverage for the therapy (bill after bill has been dropped, to no avail).

Still, with Baucus staying put for several more months and with his track record on competitive bidding, the industry’s biggest battle with him may be yet to come. The industry is redoubling its efforts to replace competitive bidding with a market-pricing program (MPP) before CMS implements Round 2 on July 1. What will he do, if anything?

The next question becomes: Who will replace Baucus as chairman? If the Democrats maintain control of the Senate, the next in line is Sen. Ron Wyden, D-Ore. He’s been tight lipped about his potential promotion, but here’s what he told The New York Times:

“My bottom line is, the country is expecting the Finance Committee over the next two years to focus on the country’s priorities and that’s improving the fiscal picture, fixing this broken, dysfunctional mess of a tax code and dealing with what is a demographic tsunami with huge implications for Medicare. I’m just going to leave it at that.”

A demographic tsunami indeed. If competitive bidding moves forward, it may be a deadly one.

by: Liz Beaulieu - Friday, April 19, 2013

Mal Mixon recently completed a new book chronicling his life’s experiences, but in no way is he ready to close the chapter on his company Invacare or the HME industry.

The author of “An American Journey” realizes that Invacare’s run-in with the Food and Drug Administration (FDA) and the industry’s battle with competitive bidding are still very much unfolding and he stands resolute in his support.

On Invacare, he said: “We’ll get through it. We’re taking the criticism that comes with it from Wall Street, but I believe we’ll come out stronger for it.”

On competitive bidding, he said: “I’ll keep fighting for the industry. I won’t give up and, hopefully, we’ll beat this thing.”

Drawing from his experiences, including his stint with the Marines; his college years at Harvard University; his job at Technicare, a division of Johnson & Johnson; and his decision to lead the purchase of Invacare, Mixon had these words of advice for HME providers:

Look outward

“I think this industry has been sort of inward. Providers have always been more concerned about their businesses and how it affects them. A few leaders have emerged to carry the ball for the industry, but when you look at the hospital and physician lobby, we’re almost no voice at all. A professor at Harvard told me, ‘If you don’t blow your own horn, someone else will use it as a spittoon.’”

Stay positive

“I always see the glass as half full. I know that home care is going to be huge eventually. People are living longer and the cost is lower at home. I can’t see all of America living in institutions. I think the ACO concept is in favor of home care. If I were a hospital president or CEO, I’d have a homecare component that took care of my patients.”

Keep learning

“I meet a lot of different people. A lot of times, you can do something for them or teach them something, and they can do the same for you. I say, 'I still haven’t decided what I want to be when I grow up.' I’m learning all the time. I try to apply what I know, and the more I learn, the better I become.”

by: Liz Beaulieu - Thursday, April 11, 2013

I feel like we’ve heard a lot of HME providers talking about the important role that they play in helping to reduce hospital readmission rates, and I feel like we’ve seen some providers walking the talk, too.

Take Alana HealthCare. In the HME Newswire a couple of weeks ago, Managing Editor Theresa Flaherty wrote about how this provider has reduced readmission rates for stage IV COPD patients with respiratory failure between 40% and 73%. That’s pretty impressive.

We’ve also written about efforts by Landauer Metropolitan, AmeriCare, ContinuCare HealthServices, Klingensmith Healthcare and others.

So I didn’t think it was too much of a leap, when we asked readers this week as part of our most recent NewsPoll: 1.) do you serve patients with chronic conditions; and 2.) if so, do you keep track of 30-day hospital readmission rates?

We knew this wouldn’t be the type of poll that would get hundreds of responses because, even though we’ve heard a lot of talking and seen some walking, we realize this is still an emerging role for most providers.

But I’m still surprised that the results of the poll show that, while 97% of respondents serve patients with chronic conditions like diabetes and COPD, only 25% track readmission rates.

(Granted, only 33 readers have taken the poll so far—re-read fifth paragraph).

Now I realize this question is a little more complicated than it seems. As one provider pointed out to me on twitter in 140 characters or less: “Process/data visibility not there to do it efficiently, UNLESS you partner with integrated system with ACO-like model that will share data.”

He has a point. Some of the providers above, like ContinuCare HealthServices, are owned by hospitals or health systems, which makes these efforts much, much easier.

But providers that aren’t owned by hospitals or health systems are making it happen, too, by forging new partnerships with hospitals and health systems centered around this new role.

Take Klingensmith. In a story about its disease management program, President Dave Knepshield told us: “We went to hospitals and the first five CEOs we showed said, ‘Oh my God. This is incredible.’”

One respondent to the poll said: “We created our own assessment software and database to develop risk scores and define performance improvement goals. We’re able to market the program directly to payers.”

That’s what I’m talking about. This isn’t the kind of role that’s just going to happen to providers. You have to make it happen.

by: Liz Beaulieu - Thursday, April 4, 2013

I was talking to an HME provider on the phone yesterday, which I’m known to do, and he mentioned a guest blog that we posted to our website recently in which a provider makes the case for allowing competitive bidding to move forward and blow up in Congress’ and CMS’s face. Those are my words, not the provider-blogger’s.

The provider-blogger’s words: “Perhaps it is time to let Armageddon occur.” (He also writes: “If I were to offer our industry a bold plan of action going forward, it would be this: Stop pushing MPP and start saying, ‘We can no longer be held responsible. We tried and nobody listened. Now face the music.’”)

The provider I was talking to on the phone said he completely agreed with the provider-blogger. “It’s what we’re all thinking, but no one’s saying,” he said.

So what might Armageddon look like?

Well, I found it freakishly eerie this morning when I saw an article in the Washington Post about how cancer clinics across the nation are turning away thousands of Medicare patients due to cuts that went into effect April 1 as part of the sequester.

My reaction: That should turn some heads.

And we’re talking about a 2% cut, here, versus the 45% cut, on average, that will go into effect under Round 2 of competitive bidding. (Actually, the 2% cut is a bigger deal for the clinics than you’d think at first blush, because most operate on 6% profit margins, according to the article).

Under the cut, one clinic says between 50% and 70% of the chemotherapy drugs it administers have become money-losers.

Another clinic says it will have to turn away one-third of its 16,000 Medicare patients.

These patients turned away from the clinics will likely have to go to the hospital, where their treatments will be much more expensive to administer and for Medicare to pay for.

“One study from actuarial firm Milliman found that chemotherapy delivered in a hospital setting costs the federal government an average of $6,500 more annually than care delivered in a community clinic,” the article states.

Does this type of scenario sound familiar? This is the kind of Armageddon providers are talking real-time.

by: Liz Beaulieu - Tuesday, March 26, 2013

I saw two items online this morning that really bent me out of shape.

The first was an article in The Hill:

America’s Health Insurance Plans (AHIP) has reported that more than 40,000 seniors have called, written or met with their congressional offices to oppose the Obama administration’s proposed 2.2% cut to Medicare Advantage.

Good for the AHIP, but if I’m an HME industry stakeholder I see so many things wrong with this paragraph.

First of all, this cut was proposed, oh I don’t know, in the past few months, and already, 40,000 seniors have spoken out about it? Where have these seniors been in the, I don’t know, 10 years or more that the HME industry has been fighting competitive bidding?

Second of all, these 40,000 seniors are up in arms over a 2.2% cut? I guess this is only the latest in a series of reductions to Medicare Advantage, but a 2.2 cut%? A “crushing blow”? Really? Do they know that on July 1, their friendly HME providers will have to absorb, on average, a 45% cut for certain HME and a 72% cut for diabetes supplies?

So this was the frame of mind I was in when I saw this second item, a letter to the editor from a user of home oxygen therapy in North Carolina:

At night, I am prescribed to use an Invacare Perfecto2 oxygen generator. I can buy a new one over the Internet for $707. I did not buy one though; instead, I rented one from a company in Greenville. The company in Greenville billed Medicare $17,100 for my $707 unit. Medicare said, “You are nuts! You overbilled us! That machine is only worth $6,338. Consequently, Medicare will only pay 80 percent of its worth, or $5,070, and you can get the other 20 percent from the user.” That left me paying the $1,268 balance. So, in summary, the company in Greenville received $5,070 from Medicare and $1,268 from me for a machine whose retail price is $707.

I wonder how many services come with that $707 unit? Set-up? Training? Maintenance? Emergency assistance?

So, not only are seniors not supporting the HME industry’s efforts on a grand scale, but also they’re biting the hands that help them breathe.

Suffice it to say, the lack of awareness among this growing and galvanizing group, when it comes to the HME benefit, hit me really hard today.

by: Liz Beaulieu - Thursday, March 21, 2013

Another 11 HME News TV interviews at Medtrade Spring today. Here are some quick hits:

Jim Hollingshead of ResMed on how the relationship between sleep manufacturers and providers has changed in the past few years due to the emphasis on compliance (due to more stringent policies) and the need for cash sales (due to declining reimbursement)—“It’s about more than boxes and masks.”

Rick Worstell on the increase in the number of providers who are taking audits to the administrative law judge (ALJ) level—Their cash flow may get tied up for six months, but “they’re not settling,” he said. The attitude to have, when it comes to audits: perseverance, he said.

Kevin Gaffney of Nielsen/Medtrade on what was at the top of a provider’s to-do list at the show this year—“They’re here for solutions,” he said. “They’re looking for ways to expand their businesses.”

Mike Sperduti of Emerge Sales on what providers need to focus on to turn their businesses around—He said make sales the No. 1 priority and add new products. He said he’s working with a provider who doubled her revenue in one year just by adding a pain management product that she discovered at Medtrade last year.

Don Clayback of NCART on the next step in efforts to advance a bill to create a separate benefit for complex rehab—He said the Disabilities Caucus in Congress is expected to hold a briefing on the Hill this spring to give industry stakeholders a more public opportunity to educate lawmakers on the bill.

Jay Witter at AAHomecare on efforts to fight competitive bidding—In addition to a bill to replace the program with a market-pricing program, stakeholders are pursuing a bill to delay Round 2 from July 1 to Dec. 31. Because CMS doesn’t have to implement the program on July 1—just some time in 2013—they believe there won’t be a pay-for.

Chris Kinard of QS/1 on why providers should do their homework before jumping into retail—“Retail may be the answer, but it may not be, depending on your demographics and other factors,” he said. If retail is not a good fit, providers still have options, he said, through horizontal (take existing products into new markets) and vertical (add new products to existing markets) growth.

Stay tuned to in the upcoming weeks for full interviews from Medtrade Spring.

‘Til next time!

by: Liz Beaulieu - Wednesday, March 20, 2013

After sitting down with 13 of the industry’s finest consultants, manufacturers and other stakeholders today, I feel more positive than ever that HME providers have a treasure chest of resources ready and waiting to help them through what’s likely to be a bumpy year.

Bruce Brothis of Allegient Billing and Consulting shared his nine Ds to becoming a successful provider—everything from developing retail to data mining to determining a use for the advanced beneficiary notice (ABN) to document imaging. He thinks providers could improve their businesses with broad strokes. “I used to be reimbursement focused, but now it’s about overall operations,” he said. “It can be a dramatic change.”

Consultant Bill Stelzer shared the key to turning a retail business, like home modifications, into a cash-making machine. Providers, he said, need to realize that marketing to customers is a lot different than marketing to referral sources. With customers, he said, you have to attract their business by communicating and responding to them in the marketplace, and you have to treat them like gold once they walk through your doors. “If you take care of customers, the cash follows,” he said.

Gary Long at Brightree shared an interesting analogy for how some providers—mistakenly—think about their software and what it can do. You may have a Motorola flip phone that works just fine, but what could you do if you had an iPhone? “Don’t assume that the technology you have is the best,” he said. He also shared where he sees software going next, including increased data mining (yes, that’s the second reference of the day), and increased interoperability with new technologies (like telehealth) and different healthcare players (like hospitals).

Other quick hits:

Martin Szmal and Dan Fedor of The Mobility Consultants on the PMD demo—Things are running smoothly in Jurisdictions A, C and D, they said, but there are still some hiccups in Jurisdiction B.

Craig Hittle of Somerset CPAs on the impact of the Round 2 payment amounts on valuations and providers that are looking to sell their business—“The timing is not so great,” he said.

Consultant Louis Feuer on the role of drivers in a provider’s success—“They could be the unsung heroes,” he said. “They’re the only person in the home. They should be part sales rep, part PR agent.”

by: Liz Beaulieu - Tuesday, March 19, 2013

No, I won't be at the wave pool at The Mandalay Bay. (Isn't that cool, though?)

I'll be taping some 20-plus HME News TV interviews adjacent to the HME News booth #1104. It's a jam-packed schedule with some familar faces and some new faces—everyone from billing buffs to lobbying giants to legal eagles.

Wednesday, March 20

10:30    Bruce Brothis                     Allegient Billing & Consulting
11:00    Cara Bachenheimer           Invacare
11:30    Bill Stelzer                          Bill Stelzer Consulting
12:00    Sarah Hanna                      ECS Billing & Consulting
12:30    Gary Long                          Brightree
1:00      Martin Szmal/Dan Fedor    The Mobility Consultants, LLC
1:30      Craig Hittle                         Somerset CPAs
2:00      Louis Feuer                        Dynamic Seminars & Consulting/MedComment Center
2:30      Gabe Buckner                    Strategic AR
3:00      Denise Fletcher                  Brown & Fortunato
3:30      Don Clayback                     NCART
4:00      Roxie Murray                      Jaysec
4:30      Clint Geffert                        VGM & Associates

Thursday, March 21

9:30      Jim Holligshead                 ResMed
10:00    Rick Worstell                     Harrington Management Group/The Audit Team
11:00    Kevin Gaffney                    Neilsen/Medtrade
11:30    Seth Johnson                    Pride Mobility Products
12:00    Mike Sperduti                    Emerge Sales
12:30    Jay Witter                          AAHomecare
1:00      Wayne Grau                      The MED Group
1:30      Cy Corgan                         Pride Mobility Products
2:00      Chris Kinard                      QS/1
2:30      Jon Jasperson                  DMETrain

Also, here's a shout-out to some peeps I've already seen today: Kevin Gaffney, The McDevitts (Ryan and Anna), Tyler Wilson, Peggy Walker, Christina Brown, Shelly Prial. Here's to seeing many more of you in the next two days!