US Oxygen Policy A Disaster For Suppliers, Says National Association Of Independent Medical Equipment Suppliers

Main Category: Medical Devices / Diagnostics
Article Date: 03 Nov 2008 - 9:00 PST

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After three years waiting for the post 36-month capped oxygen policy, the DME industry received a stark dose of CMS unreality. In just 22-pages of the 1459 page final rule for the Medicare Physician Fee Schedule (MPFS) for calendar year 2009, CMS took the mandate of Congress in the DRA 2005 and MIPAA 2008 to the very extremes. Most devastating was that the repeal of the transfer of ownership by Congress was used by CMS to essentially say to oxygen suppliers, "you took the patient, now you have to serve them after the cap for free regardless of what they need or where they go."

Every DME stakeholder has issued statements deriding the new policy, but little can be done unless Congress acts during the lame duck session after the election. NAIMES has written to key legislators asking for relief by repealing the cap policy passed by Congress in 2005. "We are asking that the provisions of HR 621 be included in any economic stimulus package that is brought to the floor of the House and Senate." stated Wayne Stanfield, NAIMES President. NAIMES has previously contacted House Ways and Means Committee members asking for help in repealing this bad public policy. Since a proposed economic stimulus package will likely be the only bill voted on before this year ends, the industry has only one chance to stop the rules from taking place.

HR 621 was introduced January 2007 by Rep. Tom Price of Georgia and has 143 co-sponsors. The Senate companion bill, S 1484, introduced by Senator Pat Roberts in May 2007 has 11 co-sponsors. This legislation is to repeal the provisions of the DRA 2005 and restore payments for home oxygen therapy to that in place prior to passage of the DRA 2005. "Possibly the only chance we have to end the pending crisis for patients and suppliers is to insure that a repeal of the cap is passed before January 1, 2009," notes Stanfield.

The presumption that suppliers must actually support a piece of equipment for two years without payments equates to telling any other healthcare provider that they are totally responsible for a patients care for two years after an initial service such as a hip replacement or installing a pacemaker. The gross error in that judgment is that this equipment sustains the life of the patients for which it was prescribed by a physician. It is ridiculous to consider that a payment cap can be placed on equipment that delivers the very breath keeping these frailest of seniors at home. Capping this FDA regulated drug is the same as capping payments for medications that a patient depends on to manage other disease states such as diabetes, congestive heart failure, or hypertension.

The assumptions and statements contained in the policy released by CMS clearly shows that they have no concept of what home oxygen therapy means or what service is required of oxygen providers. Some of the rules are so ridiculous they would be laughable if they were not so frightening. Consider the fact that the policy states an oxygen supplier is responsible for providing oxygen to a patient that moves or travels, either directly or by arranging without another supplier. Such a requirement is completely unreasonable. The east coast provider whose patient moves to the mid-west in the 38th month would certainly not be able to meet the patient's needs themselves and would have to pay a subcontractor out of pocket without any reimbursement for the next 22 months. The ongoing cost of the service portion of providing home oxygen therapy is documented by studies as being 78% of the fee paid by Medicare. The ludicrous assumption that because a supplier was paid for three years they can support a patient for the next 24-months without payment shows the complete disregard for reality, the desire of CMS to further broadly punish the DME industry.

The policy contains provisions that will disrupt the home oxygen therapy to an estimated 200,000 to 350,000 Medicare oxygen patients including those enrolled in Medicare Advantage plans. The real crisis is for suppliers who are left without recourse at this point in the process. The policy clearly states that the supplier MUST continue to provide the equipment for no additional payment. With the repeal of the transfer of ownership, suppliers have no ability to collect any payment from the patient. Since the equipment remains the property of the supplier, the rules essentially take any patient responsibility out of the equation. Further, patients cannot be expected, nor will they have any incentive to write or call Congress since the policy mandates that suppliers must provide all support, repair, supplies, on-call, and routine maintenance to them without charge (except for $30 every 6-months for 2009).

With the mandates of this policy, NAIMES believes that hundreds of suppliers will simply opt out of oxygen service and some may ultimately go out of business. Good and sound suppliers will be forced to choose their conscience over good business and will serve patients without payment until they cannot sustain their businesses any longer. No supplier will accept an existing patient for service after the cap, or even within a few months before. The most fearful part is that suppliers who make good decisions for their business will be punished by CMS for failing to serve patients without realizing the full ramifications of their choice. Suppliers are trapped between being a compassionate business and staying in business. Suppliers who end service will risk the wrath of referral sources and patients, as well as Medicare. All suppliers are urged to carefully asses any decision being considered relating to this policy to minimize their exposure and risk.

Every supplier MUST get involved NOW. For once, every oxygen supplier, small or large, public or private is in the same predicament and must take action. Suppliers must call their Representatives and Senators IMMEDIATELY and ask that the oxygen cap be repealed. Ask that HR 621, either as a stand-alone bill, or as an amendment to the proposed economic stimulus bill, be passed as soon as possible. Be persistent with your calls. Time is of the essence so write only if you fax or email your letters.

With the repeal of the transfer of ownership, the 2-month notice required by the November 2006 regulations no longer apply since the equipment remains the property of the supplier. Unless a new supplier agrees to take a patient from the original supplier, the original supplier is responsible for serving the patient until a new cap period can begin after 5 years. There are no provisions releasing the original supplier from responsibility, nor one giving the supplier the ability to opt out of providing the service if no one else is willing to take the patient. This is based on the belief by CMS that the supplier has received adequate payment during the three year cap period to sustain them during the subsequent 24-months.

Changing from assigned to non-assigned is permissible, but will only allow a supplier to charge for contents at the customary price. The supplier cannot charge for any covered service or equipment after the cap, regardless of assignment of benefits.

Without the intervention of Congress, there is likely to be little relief from these rules and certainly none related to payments for service, despite vague language in the MIPAA 2008 law to the contrary. While a mention of ongoing payments was included in HR 6331, CMS clearly interpreted this to mean no payment for the ongoing service to the patient. Throughout the policy, CMS persistently writes that they must protect the beneficiary from the very supplier they rely on for their service. It assumes the industry is riddled with bad players waiting for an opportunity to cash in, a classic example of being presumed guilty before the trial.

The ball is now in the court of the thousands of oxygen suppliers around the country. NAIMES urges every supplier to take positive and proactive steps to reach Congress immediately after the election. With Congress expected to be called back into a lame-duck session after Veterans Day, any chance of action will depend on the volume of calls that reach their offices.

Do not wait for someone else to act.

naimes, vgm, invacare, aahomecare and others will be taking all possible steps to reach a solution, but only suppliers can actually affect change by making your feeling known to washington. congress is at home and can be reached at their home district offices as well as in washington. contact information can be found on at http://www.dmehelp.org or call the capitol switchboard at 202-224-3121.

naimes = committed + aggressive + proactive + grassroots

NAIMES is a national association representing independent durable medical equipment suppliers and a grassroots advocate for the DME industry.

Source
Wayne Stanfield
President & CEO
http://www.dmehelp.org