Homecare Group Sees Deep Flaws in Medicare Bidding
for Durable Medical Equipment
Association says problems not fixed and
not addressed by GAO study
Statement by the American Association for Homecare
Dec. 14, 2009 The American Association for Homecare
has worked with Congress and Medicare to address flaws in the
competitive bidding program for durable medical equipment, some of which
are discussed in a new Government Accountability Office (GAO) report.
However, deep structural and design flaws still remain in this bidding
program. Those flaws will reduce seniors' access to quality care at home
and will put thousands of competitive homecare providers out of
business.
Details
fluid but people aged 55 to 64 who were uninsured or could not afford
employer-sponsored health insurance would be allowed to enroll in Medicare
People are living longer, yet many are living with
one or more chronic diseases and a decline in cognitive ability, which
has major implications for home health care agencies
Report to Congress again emphasizes Medicares
payment system for private fee-for-service plans is seriously flawed;
wants significant cuts to home healthcare providers (payments cuts of
5.5% next year), hospice end-of-life care, medical imaging services and
Medicare Advantage insurance plans; does suggest a 1.1 percent hike for
doctors but more transparency.
March 2, 2009 The annual Medicare Payment
Advisory Commissions report to congress makes a serious stab at
recommendations to slow the spiraling costs that threaten the Medicare
programs viability, but the industries being pricked are fighting back.
In a press release released with the report on Friday, MedPACs chairman
says the government must not look at the costs of providers as
unchangeable but should realize the pricing is influenced by how
providers are paid.
Read more including fact sheet with specific recommendations...
The GAO report says the federal agency in charge
of the program, the Centers for Medicare and Medicaid Services (CMS),
provided unclear and inconsistent information, particularly regarding
bidding requirements and financial information. Some bids by equipment
providers were incorrectly disqualified.
The report further details the
lack of notification to providers about the post-bid review process. The
GAO report also notes that its report did not identify "concerns with
the overall structure and design" of the bidding program because "such
an analysis was beyond the scope" of the report.
"The fact remains that CMS has not fixed the
fundamental problems in the design and structure," said Tyler J. Wilson,
president and CEO of the American Association for Homecare.
"Those
fundamental flaws in the structure of the program are dangerous because
they will reduce seniors' access to quality, cost-effective care at
home, and the flaws will needlessly put thousands of competitive,
hard-working medical equipment providers out of business."
The initial roll-out of the bidding program in 2008
produced disastrous results for home medical equipment patients and for
providers (mostly small businesses), which were excluded from Medicare
as a result of the first round of bidding.
During the 2008
implementation, serious problems were encountered, such as disruption to
patient services, greater costs to Medicare due to delayed discharge of
patients to homecare, award of Medicare contracts to companies that were
not licensed to furnish equipment and services, and desperation bidding
by companies that faced losing their business if they were not awarded a
contract.
Due to these problems, Congress delayed the bid
program when it enacted the Medicare Improvements for Patients and
Providers Act of 2008, in hopes that the federal Centers for Medicare
and Medicaid Services would substantially improve and reform the
program. However, the fundamental problems still remain in the bid
program.
The congressional action last year to delay the bidding program
also required that the home medical equipment sector accept a 9.5
percent reimbursement cut on all items included in the bidding program
effective January 1, 2009 to pay for the savings the bid program would
have reaped.
Continuing concerns among patient and provider
advocates who oppose the misguided bidding program include:
● Reduced access to quality home medical
equipment and services since the bid program would vastly reduce the
number of homecare providers allowed to participate in Medicare;
● Widespread business failures and loss of jobs
for home medical equipment providers who will be forced out of Medicare
- even if they were willing to provide items and services for the lower
prices set by the Medicare bid process;
● More difficulty getting basic services and
equipment since many Medicare beneficiaries would be forced to use
multiple, unfamiliar providers for different items and services, instead
of continuing to use a single, familiar provider;
● Lack of transparency within the entire
bidding program and a lack of willingness to heed the advice of the
Medicare advisory PAOC;
● Reductions in service and quality of items
and services based on artificially low winning bid amounts. There is no
requirement that providers accept a bid if they are awarded one, which
leads to providers submitting artificially low bids.
Elimination of this Medicare competitive bidding
program for home medical equipment is supported by numerous consumer and
patient groups such as: American Association for People with
Disabilities, COPD Alert, International Ventilator Users Network,
Muscular Dystrophy Association, National Association for the Support of
Long-Term Care, National Emphysema/COPD Association, National Spinal
Cord Injury Association, Post-Polio Health International, RetireSafe and
United Spinal Association.
A bill in the House of Representatives introduced
by Rep. Kendrick Meek (D-Fla.) would eliminate the bidding program and
would also help control Medicare spending by reducing Medicare
reimbursement rates for home medical equipment and services in 2010,
2011, 2012, 2014, and 2015.
At the same time, the bill will allow thousands of
home medical providers to keep their doors open to serve the millions of
Americans who require home-based care and will allow patients to
continue to receive services from the providers of their choice.
The bill, H.R. 3790, has broad bipartisan support
with 97 cosponsors so far.
Paul J. Tobin, president and CEO, United Spinal
Association, said, "Congressman Meek and other bipartisan leaders in the
House have recognized that wheelchairs and a host of other home medical
devices are essential tools which, when properly configured for each
individual patient, can liberate a person and maximize their quality of
life.
Unfortunately, the competitive bidding process
will eliminate the home medical equipment provider's ability to
individually customize equipment based upon each patient's medical needs
and restrict the patient's ability to work face-to-face with a local
provider. If implemented, competitive bidding will have tragic,
unintended consequences for seniors and people with disabilities."
Durable, or home medical equipment, such as oxygen,
wheelchairs, diabetic supplies, and hospital beds, enables seniors and
people with disabilities to receive quality care at home. Home-based
care represents a cost-effective alternative to institutional care, and
seniors prefer to receive care at home rather than in an institution.
The re-bidding process is now under way in nine
metropolitan statistical areas (MSAs) across the U.S. - Charlotte,
Cincinnati, Cleveland, Dallas-Fort Worth, Kansas City, Miami, Orlando,
Pittsburgh, and Riverside, Calif. The bid prices and bid winners would
be selected in 2010 and the new prices would become effective January 1,
2011.
Another round of bidding will begin shortly after
that in 70 MSAs across the U.S. Categories subject to the Round One
Rebid include medical oxygen, which is a highly regulated prescription
drug, complex rehabilitative power wheelchairs, enteral nutrients (used
in tube feeding), as well as hospital beds, among other categories.
In addition to recommending the Meek bill, which
would help control Medicare spending, the American Association for
Homecare has strongly endorsed the bill recently introduced by Sen.
George LeMieux (S. 2128), which would institute real-time claim audits
and increase resources available to fraud fighters in Medicare. Earlier
this year, the Association introduced an aggressive 13-point anti-fraud
legislative action plan. The LeMieux bill incorporated some of those
points, and the Association hopes that Congress will go further and
adopt the entire 13-point plan (see www.aahomecare.org/stopfraud).
Home medical equipment and care is already the most
cost-effective, slowest-growing portion of Medicare spending, increasing
only 0.75 percent per year according to the most recent National Health
Expenditures data. That compares to more than 6 percent annual growth
for Medicare spending overall. Home medical equipment represents only
1.6 percent of the Medicare budget.
he American Association for Homecare represents
durable medical equipment providers, manufacturers, and other
organizations in the homecare community. Members serve the medical needs
of millions of Americans who require oxygen equipment and therapy,
mobility assistive technologies, medical supplies, inhalation drug
therapy, home infusion, and other medical equipment and services in
their homes.
The Association's members operate more than 3,000
homecare locations in all 50 states. Visit
http://www.aahomecare.org.
This statement was released on December 8, 2009
Keep up with the latest news for senior citizens, baby
boomers
Dec. 14, 2009 The American Association for Homecare
has worked with Congress and Medicare to address flaws in the
competitive bidding program for durable medical equipment, some of which
are discussed in a new Government Accountability Office (GAO) report.
However, deep structural and design flaws still remain in this bidding
program. Those flaws will reduce seniors' access to quality care at home
and will put thousands of competitive homecare providers out of
business.
