AAHomecare Launches Study of Medicare Gap-Filling Price Method for Home Medical Equipment

Main Category: Caregivers / Homecare
Article Date: 11 Feb 2005 - 10:00 PDT

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The American Association for Homecare (AAHomecare) is commissioning the research firm of Muse & Associates for a study on the alternatives to Medicare gap-filling reimbursement.

The study will be designed to provide several types of information. It will help provide the Centers for Medicare and Medicaid Services (CMS) a basis for developing alternative price-setting methodology to the current gap-filling methodology, which is used to determine allowables for home medical equipment (HME) items including methodology for new power wheelchair codes. Also, in the longer term, the study will help to establish a more formal process to ensure that the homecare community can share information with CMS about refinements to the new price-setting methodology.

The gap-filling methodology for HME is used by CMS to approximate historic reasonable charges when the historic data needed to calculate the fee schedules are not available. If price lists from 1986 to 1987 are not available and more current prices are used, the Medicare carriers are instructed to decrease the more current prices by a "deflation" factor to approximate the base year price for gap-filling. The deflation factors are based on the percentage change in the consumer price index for all urban consumers. This gap-filling methodology has been used since 1989.

CMS is expected to issue new Healthcare Common Procedure Coding System (HCPCS) codes and respective pricing for each of the power wheelchair codes by September. Unless CMS adopts an alternative, they will use the current gap-filling methodology to determine a fee for these codes.

Kay Cox, President and CEO of AAHomecare, stated, "As we saw last September with the seating and positioning changes, the existing gap-filling methodology created problems in the calculations of the new allowables. AAHomecare wants to propose an alternative for pricing the new power wheelchair codes to avoid the disruption to beneficiary access and care that will occur if the fee schedule amounts do not accurately represent the technology included in each new code. The benefits of this study on gap-filling methodology will go beyond power wheelchair codes. Repairing the flawed nature of gap-filling will benefit every new technology that is introduced to the marketplace."

Michael Reinemer - michaelr@aahomecare.org
Vice President, Communications
American Association for Homecare
625 Slaters Lane, Suite 200
Alexandria, VA 22314-1171
703-535-1881
http://www.aahomecare.org

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