American Association for Homecare Opposes Any Cut to Dispensing Fee for Home Inhalation Drug Therapy

Main Category: Caregivers / Homecare
Article Date: 03 Aug 2005 - 21:00 PDT

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The American Association for Homecare (AAHomecare) reiterated its strong opposition to any reduction in the Medicare dispensing fee for home inhalation drug therapy, which is needed by nearly one million Medicare beneficiaries. In its proposed 2006 physician fee schedule released on August 1, the Centers for Medicare and Medicaid Services (CMS) suggested that the 2006 dispensing fee "will likely be lower than the 2005 level."

"AAHomecare continues to strongly oppose any reduction in the dispensing fee for home inhalation drug therapy, which is currently under-reimbursed," stated Kay Cox, President and CEO of the American Association for Homecare. "No new studies have been conducted on dispensing fees, so a proposed reduction in the fee appears to be premature in light of no additional data and the few months of experience under the existing fee amount. In fact, a small inflation increase to the dispensing fee is warranted and appropriate. Acute care hospitals, inpatient rehabilitation facilities, skilled nursing facilities, and other provider sectors have received inflation increases."

"We welcome the opportunity to provide CMS with information about the cost of dispensing this critical therapy and look forward to a close dialogue in the weeks ahead. The fee must account for the numerous, specific costs involved in dispensing this therapy. Any cut in the fee would make it harder to provide the therapy to Medicare beneficiaries in the most cost-effective setting, which is in their homes. Homecare is a key part of the solution to the nation's Medicare and Medicaid crisis."

Last year, the American Association for Homecare and its members worked very closely with both the Government Accountability Office (GAO) and CMS to provide detailed data that supports a dispensing fee that would cover the costs of dispensing home inhalation drug therapies for Medicare beneficiaries.

In 2004, AAHomecare commissioned a study by Muse and Associates of 109 pharmacies. The study's findings emphasized that the 2005 Medicare reimbursement formula based on average sales price (ASP) would under-reimburse the actual cost of providing two key drug therapies by $68.10 per monthly supply. AAHomecare shared with the GAO and CMS information about the patient-management, pharmacy, compounding, delivery, and administrative costs of providing these drug therapies and argued the therapies cannot be provided to Medicare patients at the ASP formula without a substantial dispensing fee.

In the proposed rule for the 2005 physician fee schedule issued last August, CMS proposed an 89 percent reimbursement cut for the drugs, using the ASP formula, for albuterol sulfate and ipratropium bromide. The drugs are commonly prescribed to treat diseases like chronic obstructive pulmonary disease (COPD), which afflict more than 14 million Americans. In recognition of the dispensing costs associated with home inhalation drug therapy for Medicare beneficiaries, CMS announced last November a $57 monthly dispensing fee for inhalation therapies for the 2005 physicians fee schedule and a 90-day fee of $80.

Homecare delivers value for Americans' healthcare dollar. The American Association for Homecare is the only national association that represents every line of service in the homecare community, including home health and home medical equipment providers, respiratory and infusion therapy, telemedicine, rehab and assistive technology, and hospice. With more than 3,000 member locations, AAHomecare advances quality healthcare services where patients prefer them - at home.

Michael Reinemer, VP, Communications
American Association for Homecare
625 Slaters Lane, Suite 200
Alexandria, VA 22314-1171
703-535-1881 (cell: 703-966-9574)
michaelr@aahomecare.org
http://www.aahomecare.org

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