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June 27, 2011 Volume 17, Number 24


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Table of Contents
- Competitive Bidding Still Going 'Smoothly,' CMS Repeats
- Cramton Study Offers Proof: Lowball Bids Cut Out Experienced Companies
- CMS to Conduct ‘Audit Audit’
- OIG Cautions IDTF Arrangements Could Bring Up Anti-Kickback Concerns
- Another Try for Medicare Home Infusion Coverage
- Sooner Mobility's Choate: 'I Fired Medicare'
- Get Ready for Round 2; Rehab Services Should Be Priority, Say Speakers at Hill Briefing; More News in Brief

For more industry news, features and highlights from our latest issue, please visit our Web site at

- Headline News
Competitive Bidding Still Going 'Smoothly,' CMS Repeats
BALTIMORE—At an April 5 meeting of the Program Advisory and Oversight Committee, CMS officials gave what industry attendees described as a rosy picture of competitive bidding since its January implementation in nine MSAs. According to CMS’ Michael Keane, that’s still the case.

“The program continues to go very smoothly with few inquiries and complaints and no evidence of negative beneficiary health outcomes or negative adverse impacts (such as increases in hospitalizations or emergency room visits),” Keane wrote in a June 17 letter to PAOC members.

He also said that the goal of ensuring multiple suppliers and beneficiary choice under the program “has been met consistently with no need to add additional contract suppliers.”

Keane, director of CMS’ Chronic Care Policy Group, wrote the letter in response to some PAOC members who requested additional data on Round 1 of the bidding program following the April meeting. In a May 6 letter, a dozen of the 17 committee members asked for updates on the percentage of beneficiaries using DME, the number of contract suppliers that had closed or been added since Jan. 1 and specific information on the mail-order diabetic supplies category.

They also asked for clarification on the number of calls to Medicare’s help line about competitive bidding.

Keane’s letter didn’t address all of the requests (or other industry advocates' concerns on how CMS classifies “complaints” about the bidding program). It did include highlights for 1-800-MEDICARE from January through March showing that of 6,596,669 total calls, less than 0.9 percent—57,530—were related to competitive bidding, with the number of those calls “continuing to decrease weekly.”

According to the CMS data:

• Nearly 70 percent (39,492) of the competitive bidding inquiries were general questions that did not relate to specific products. The top questions were:

—“Can I have a list of suppliers that can be used?”
—“Can I continue to use my supplier/need to change?” and
—“How does competitive bidding affect me?”

• About 30 percent (18,038) of the competitive bidding inquiries were about specific product categories. Of those, about 75 percent (13,813) were about mail-order diabetic supplies.

In their letter, the PAOC members noted that when competitive bidding expands to 91 additional areas, “CMS can anticipate a dramatic increase in queries, totaling more than one million additional calls in less than a three-month period following implementation of Round Two.”

Keane’s response said data from CMS’ real-time claims monitoring that had been relayed at the PAOC meeting would be posted on its website soon and then would be updated monthly.

“We expect to be able to make the information for the first calendar quarter of 2011 available within the next two weeks,” he wrote, adding, “We believe more complete information will provide the public a more useful window to emerging trends in this area.”

As of Friday, H.R. 1041, which would repeal the bidding program, had 133 cosponsors.

For more on the PAOC members’ requests, see PAOC Members Ask CMS for Specific Info on Round 1, May 9.

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Cramton Study Offers Proof: Lowball Bids Cut Out Experienced Companies
COLLEGE PARK, Md.—Peter Cramton continued his crusade against CMS’ competitive bidding design last week, releasing a comprehensive study that bolsters auction experts’ opinion that the program is dangerously flawed.

Using contract supplier lists issued by CMS in 2010 and PDAC (Pricing, Data Analysis and Coding) procedure code utilization data he obtained through the Freedom of Information Act, Cramton compared the market structure before and after competitive bidding and discovered disturbing changes.

“The change in market structure is dramatic,” the indefatigable University of Maryland economics professor said in his introduction to the 77-page study. “The vast majority of existing suppliers by volume are excluded from supplying Medicare beneficiaries.

“This radical transformation of the industry is the result of a fatally flawed auction design and not the outcome of an efficient competitive process,” Cramton added.

Largest Medicare Market Share Holders Cut Out
His report looks at the 50 largest providers for each product category based on Medicare charges from 2006 through 2010 by volume and market share in the Round 1 competitive bidding areas. In the most egregious cases, the analysis shows, nearly 100 percent of the providers with the greatest market share prior to competitive bidding were excluded when the Round 1 rebid was implemented in January.

According to the study, for example, 97 percent of the top market share holders in the Dallas CBA were excluded from providing mail-order diabetic supplies; 96 percent of Kansas City’s top market share holders were cut out of the Medicare walker market; and in Miami, 94 percent of those who held the lion’s share of the support surfaces market were excluded because of the CMS program.

“The result will be immediate harm to Medicare beneficiaries and the vast majority of Medicare providers in the nine service areas covered by the auction,” Cramton predicted. “Beneficiaries will face poor service, selective fulfillment of orders, fraud, and other abuses. Existing suppliers will have to lay off employees and in many cases cease operation. The disruption in terms of job loss and involuntary supplier substitution will be large.”

The findings did not surprise Mark Higley, vice president, development, for the Waterloo, Iowa-based VGM Group.

“If you review the individual product categories among all the markets, the top four or five suppliers frequently exceed 50 percent of the total Medicare charges,” he noted. “After the first half dozen or so, the tail of the curve runs very long with the majority of the suppliers—winners and losers—with only tenths of 1 percent of existing market share.

“It appears many of the larger players were unwilling to offer an unreasonably low bid, and it only takes a few to vastly alter the market structure,” Higley added.

“I concur with the study abstract stating that many of these larger companies may have to lay off a substantial number of employees and Medicare beneficiaries will be faced with, as Cramton states, ‘involuntary supplier substitution,’” he said. “This most recent analysis further augments the previous studies by Cramton and others that the auction design is fatally flawed from both a technical and a practical standpoint.”

Former HME provider Rob Brant said Cramton’s study holds some valuable revelations. When the names of the contract winners were first revealed, he said, “we immediately knew that out-of-the-area companies won the bids. The difference is that with this study, we now know that companies with the market share [were shut out] and nearly all the bid winners have never done this before.”

Brant, like other providers, has already reaped the bitter harvest of what CMS has sown. He shuttered City Medical Services in North Miami Beach, Fla., at the end of April, even though he won a contract to supply oxygen.

“Before competitive bidding, there were 400 oxygen providers in Miami, and we were number eight [in market share] in the most competitive market in the country,” Brant said, noting City Medical’s standing in Cramton’s study. “I was a bid winner and I’m forced to close my doors because I refused to go into personal bankruptcy because of this program.”

Even though he was 10th in market share for CPAPs in the Miami area, he said, he did not win a contract in that category.

“I was number 10 in the whole Southwest Florida area, and I’m out of business now. What’s wrong with this picture?” Brant asked.

‘All They Were Interested In Was the Lowest Price’
What’s wrong, according to Cramton and hundreds of other experts, is CMS’ competitive bidding design. Since September, when he spearheaded a letter to Congress signed by 166 other economists and auction experts, Cramton has campaigned to end the program, saying it does not conform to accepted auction standards because bids are not binding; the median-bid pricing rule is flawed; the design encourages strategic bid skewing; and there is a lack of transparency.

On June 17, Cramton sent a letter signed by 244 auction experts to President Obama urging that the program be halted and corrected. Earlier in the month, he proposed legislative language calling for a bill that would mandate scrapping Round 1 immediately and redesigning the program.

Cramton’s analysis hammered home what he believes is a necessity.

“Although the evidence from the field is still preliminary due to a lack of complete data, the preliminary analysis of the data presented here suggests that the flaws identified in theory, experiment, and practice, are very much present in the pilot. Congress and CMS should move quickly to stop the implementation of the Round 1 rebid and move to design and implement an efficient auction for durable medical equipment,” Cramton said in his study summary.

Brant said he believes Cramton’s new report makes it abundantly apparent that CMS did not decide bid winners on any data other than a low bid. “It clearly shows all they were interested in was the lowest price,” he said.

“From reading and analyzing Dr. Cramton’s report, it kind of blows me away that … when you look at the top companies, they are already set up, they have the big vehicles, they already know what the highest manufacturers’ discounts are—and CMS ignored those companies,” said Brant. “It’s just amazing.”

In a newsletter to members of the Accredited Medical Equipment Providers of America, of which he is president, Brant wrote, “This not only shows how local communities have lost established, experienced providers, it confirms [Cramton’s] argument that inexperienced companies, with likely little idea of the cost of providing services, gamed the system with ‘lowball bids.’

“The exclusion of companies with the largest market share goes against any common sense,” Brant continued. “These established companies already have the highest volume discounts from manufacturers, have working facilities near local hospitals and already have vehicles and trained staff to handle the largest amount of business in the area. Yet Medicare gave contracts to companies who simply bid lower, regardless of their facility, vehicles, staff or if they have ever provided the equipment before.”

He pointed out the study showed that in the Cleveland CBA, 87 percent of companies with the highest market share for CPAP devices did not bid low enough to win contracts. The six largest companies, which held 57 percent of the market share, were excluded.

That concerns him because patients can, and likely will, he said, be harmed by the new providers’ lack of experience. He questioned whether bid winners in the Dallas CBA—which held only a combined 3 percent of market share in the diabetic supply category before competitive bidding—carry brand-name products, and whether the support surface bid winners in Miami—which had a total 6 percent of previous market share—were aware that patients with alternating pressure mattresses need to be evaluated each month for multiple Stage 2 or Stage 3 decubitis ulcers of the buttock.

He finds it doubtful, he said, that the contract suppliers for walkers in the Kansas City area, which made up only 4 percent of the market share pre-competitive bidding, can deliver and set up $55 walkers to patients in the area’s 11 counties.

“I couldn’t deliver a walker for that around the corner,” he said, noting that the cost of the walker is just one factor in providing the product—there is documentation, delivery, the delivery technician’s time, etc.

He pointed out that Lincare CFO Paul Gabos, speaking at a mock auction Cramton held in April, noted that only 20 percent of a provider’s cost is equipment—the other 80 percent is service.

Will Cramton’s latest study help derail competitive bidding?

“I think it is yet another example of how this program was bid improperly,” Brant said. “The problem is, without the patients saying ‘I can’t get my equipment’ or ‘I can’t get my supplies,’ Congress is just going to say, ‘Well, we knew some companies would close. That’s a shame.’”

“The study bolsters the arguments forwarded to Congress and CMS and the recent follow-up letter sent to President Obama,” said Higley. “I would hope this spurs industry stakeholders to continue to speak out and press Congress to pass H.R. 1041 [to halt competitive bidding].

“On a related note,” he added, “this study again brings ups the issue of transparency, such as the ‘capacity’ CMS presumes the supplier will supply and the company’s financial standing.”

Higley said that a May 2010 lawsuit filed by the Texas Alliance for Home Care Services against the Department of Health and Human Services “remains open, and alleges that CMS has acted contrary to law by not providing certain transparency relative to the program. Studies such as this strengthen our argument.”

Scroll down to a PDF of Cramton’s analysis, titled “Medicare Auction Failure: Early Evidence from the Round 1 Rebid,” at

CMS to Conduct ‘Audit Audit’
PHILADELPHIA—Responding to criticism from HME and hospital representatives about over-reaching audits, a high-ranking CMS official participating in a health care fraud summit June 17 said the agency would conduct an “audit audit.”

According to a report from the American Association for Homecare, CMS’ Peter Budetti, deputy administrator of the Center for Program Integrity, said the agency would investigate the merit of complaints about the growing number of audits.

“Who’s guarding the guardians?” John Shirvinsky, executive director of the Pennsylvania Association of Medical Suppliers, asked Budetti during a Q&A at the Philadelphia summit. He likened the increasing audits to TSA airport screenings where “85-year-old grandmothers and toddlers are getting patted down.”

AAHomecare’s Regulatory Council has been working to address the increasing ferocity of audits and the inconsistencies across Medicare audit programs, which now include CERT, RAC, ZPIC and medical reviews. At a June 7 meeting with CMS officials, association representatives presented recommendations on what documentation should be requested for CPAP, oxygen, enteral nutrition, diabetic supplies, power mobility devices and nebulizers. The association also made recommendations to clarify how CMS auditors conduct audits.

The goal is to ensure that all audit contractors request consistent documentation that is appropriate and specified under each Medicare coverage policy, according to Kim Brummett, chairman of the association’s Regulatory Council and vice president of Advanced Home Care, High Point, N.C. In an interview earlier this year, Brummett said the audit situation was “the worst I have ever seen. We have auditing bodies tripping over each other.”

CMS Administrator Donald Berwick, who attended the daylong summit—where HHS and CMS announced a predictive modeling tool to stem health care fraud—admitted that audits are “a blunt tool,” the association reported. Shantanu Agrawal, MD, the medical director for the Center for Program Integrity, commented, “We heard a lot of concerns about the number and frequency of audits, so we take that to heart.”

OIG Cautions IDTF Arrangements Could Bring Up Anti-Kickback Concerns
WASHINGTON—The Office of Inspector General once again cautioned providers to beware of the anti-kickback statute in an eight-page advisory opinion addressing arrangements between DME companies and independent diagnostic testing facilities.

Released June 21, the opinion (AO 11-08) said both an existing arrangement and a proposed arrangement involving contracts between a DME company that provides CPAP devices and a sleep lab could be suspect.

In the first arrangement, the DME company pays the IDTF on a per set-up basis for education and set-up services given to commercial patients. The OIG confirmed that the “commercial patient” distinction was not enough to avoid scrutiny.

According to attorney Jeff Baird, chairman of the Health Care Group at Amarillo, Texas-based Brown & Fortunato, the OIG has said repeatedly that “carving out” federal program patients from a per-patient payment arrangement does not avoid anti-kickback liability.

“If a referral source refers both Medicare and commercial patients to a provider, and receives ‘per set-up’ compensation from the provider, the parties cannot avoid the anti-kickback statute merely by excluding the Medicare patients from the calculation of the compensation,” said Baird. “In the OIG’s view, the payments are compensation for referral of all patients, even if they are calculated on the basis of commercial patients only. The parties can avoid application of the anti-kickback statute only if the referral source does not refer any federal program patients to the provider.”

Attorney Neil Caesar, president of the Health Law Center, Greenville, S.C., said the opinion reiterates much of what the OIG has said in the past, with perhaps a slight change in vigor.

“What most [suppliers] may find surprising is the government’s hesitation about anything resembling a blanket approval of a private venture from the anti-kickback perspective,” said Caesar. “Suppliers are pressured a lot these days to enter into deals with referral sources that are supposedly safe because they only involve non-government-reimbursed patients. This opinion emphasizes that it is nowhere near that simple.”

In a second arrangement described by the requestor (the company that asked for the opinion), the IDTF would refer Medicare patients to the DME company, which would pay a flat monthly or annual fee to the IDTF for its services to Medicare patients. The requestor expressly stated that the fee might not be fair market value.

“A fixed annual fee is an important element in obtaining the protection of the Personal Services and Management Contracts safe harbor to the anti-kickback statute, but only if the fee is fair market value,” explained Baird. “By declining to represent that the fee will be fair market value, the requestor guaranteed that the OIG would not approve the AO request …

“The requestor in this case may have been seeking a negative opinion in the hope of dissuading its competitors from participating in arrangements like these,” he continued. “It appears that the OIG was happy to oblige.”

In addition to directly addressing the arrangements, OIG officials sought to dissuade such questionable scenarios in the future.

“The OIG used the occasion to deliver a harangue against ‘aggressive marketing by DME suppliers’ who coerce vulnerable senior citizens into making inappropriate choices, with adverse effects on the quality of care and financial harm to federal health programs,” said Baird. “At the end of the day, the new advisory opinion breaks no new ground. Its conclusions are exactly what one would expect based on earlier OIG pronouncements, with the addition of another broad attack on the HME industry.”

Find a PDF of OIG Advisory Opinion 11-08 at

Another Try for Medicare Home Infusion Coverage
WASHINGTON—Reintroduced June 15, the Medicare Home Infusion Therapy Coverage Act of 2011 would close a gap that currently exists in coverage where the medications used in infusions to treat serious diseases are covered, but not the medical services or equipment needed to deliver the home therapy.

The proposed legislation—introduced by Sens. Olympia Snowe, R-Maine, and John Kerry, D-Mass.; and Reps. Eliot Engel, D-N.Y., and Tim Murphy, R-Pa.—calls for coverage of infusion-related services, supplies and equipment under Medicare Part B, while coverage of the drugs would remain under Part D.

According to the National Home Infusion Association, which applauded the bill, private insurers, including many state Medicaid programs, Medicare Advantage, the Veteran’s Administration and the Federal Employee Health Benefits Plan, have covered home infusion for decades. Medicare is the only major payer that does not cover all the essential components of home infusion therapy.

When Congress passed the Medicare Modernization Act in 2003, lawmakers added coverage for home infusion drugs. But CMS interpreted the law to cover only the drugs and not the services and supplies associated with the therapy.

As it stands now, Medicare beneficiaries must enter a hospital or nursing home for the infusion treatment to be covered.

“It’s wrong and stupid to drag senior citizens out of their homes for medical care when they can get safer, more cost-effective infusion therapy right at home,” Kerry said in an NHIA release.

Infusion therapy involves the administration of medication through a needle or catheter, and is prescribed for infections unresponsive to oral antibiotics, cancer-related pain, dehydration, gastrointestinal disorders, congestive heart failure, Crohn's Disease, hemophilia, immune deficiencies, multiple sclerosis and rheumatoid arthritis, among many other conditions, the NHIA said. The group also pointed to the efficiencies of home infusion, saying it costs less, produces better results and does not carry the risk of hospital-acquired infections.

Last year, the General Accountability Office generally supported the industry’s assertions.

“Health insurer officials we talked to asserted that infusion therapy at home generally costs less than treatment in other settings,” the GAO said in a June 2010 report. “Hospital inpatient care was recognized as the most costly setting. One insurer estimated that infusion therapy in a hospital could cost up to three times as much as the same therapy provided in the home.”

NHIA President and CEO Russell Bodoff urged Congress to take note of the GAO report, which he said “clearly demonstrated that home infusion therapy provides costs savings and quality patient care, with no unusual utilization.”

Since an unsuccessful attempt by New York's Engel to consolidate all components of home infusion under the Part B DME benefit in 2006, he and other lawmakers have continued a legislative push for full Medicare coverage for the therapy. A bipartisan bill introduced by Engel in 2007 went nowhere; a 2009 bill championed by Engel and Snowe picked up 104 cosponsors in the House and 31 in the Senate.

Commenting on reintroduction of the legislation, Pennsylvania’s Murphy said, “Medicare still forces patients to enter a hospital for treatment where it costs Medicare thousands of dollars versus only hundreds within the home. Entering a hospital for infusion therapy is also less convenient for the patient who is then needlessly exposed to more health risks. There is a better way, and by passing this bill we can save taxpayers money and improve the quality of life of Medicare beneficiaries.”

The Senate version of the bill (S. 1203) has been referred to the Finance Committee, and the House bill (H.R. 2195) has been referred to the Energy & Commerce and Ways & Means committees.

Sooner Mobility's Choate: 'I Fired Medicare'
TULSA, Okla.—While many HME owners are dipping their toes into the retail waters as an add-on to their current Medicare-Medicaid business, it’s not the only way to go. Gerald Choate, owner of Sooner Mobility & Rental in Tulsa, Okla., dove in headfirst.

About two years ago, Choate, unsettled by both the then-present and looming changes to Medicare and Medicaid and the rapidly declining reimbursement levels, decided to bail out of the government programs altogether and expand his retail arm.

“I fired Medicare,” Choate said.

The move, he added, “has worked out relatively well.” And that's been during a tanking economy.

“Credit card sales have really gone through the roof, whereas cash and checks dropped proportionately. I will take that 4 percent reduction [in credit card fees] compared to that 25 percent reduction in Medicare reimbursement,” Choate said.

It did take some doing to swerve completely to a non-Medicare, even non-insurance arena. Sooner Mobility already had a partial retail business alongside its Medicare and managed care segments, and the company was located in a busy shopping center so location was not an issue. But Choate did have to commit more space to retail; he now has a showroom of 2,800 square feet. He also had to boost—significantly—his stock of scooters, lift chairs, accessory items and rollators.

“By the time you get all your product lines and everything stocked, I can't imagine getting by with less than 2,000 square feet,” he said.

Choate got his stock out of the boxes and onto the floor so people could see it in different colors, test it out and compare one product to another. “We started looking specifically for other retail products—cupholders for scooters, backpacks, cushions,” he said.

He knew that a retail customer, unlike a Medicare beneficiary, would not be likely to wait for him to order a product, and he did not want people to leave his store because he didn't have an item.

“When people are retail shopping and have money and you don't have the product, you're probably not going to get the sale,” he said.

Unlike most HME providers, he has also made a significant investment in advertising. “We've done all kinds of advertising,” Choate said, noting that while direct mail has worked well, “radio did not work for us at all.

“But really,” he said, “there is no bad advertising.”

One of the best things he’s done is to take a booth at the Tulsa State Fair. “Basically, I set up an entire showroom there that is probably 1,600 square feet,” Choate said.

“Wherever people are, you can sell home medical equipment,” he said. “It’s not just a necessity, it’s a lifestyle product. You are running a retail business. It has nothing to do with medicine. You are accessorizing for people.”

As with any retail business there is some downside to retail HME, Choate said, such as the economy, competition from the Walmarts and Walgreens of the world and even bad weather, which can keep people from shopping. Even with the drawbacks, however, Choate believes that for his business, retail is the way to go.

“No one wants to be paid less and less for a product,” he said. “Medicare headaches are bad and getting worse. I think those suppliers that are already treading on thin ice, once they get hit with competitive bidding and their reimbursements are cut 20 to 30 percent more, will they be able to survive?

“If you are retail-based,” he said, “you are somewhat in control of your destiny.”

For more on Gerald Choate's Sooner Mobility, see Life without Medicare in HomeCare’s June issue.

In Brief
Get Ready for Round 2; Rehab Services Should Be Priority, Say Speakers at Hill Briefing; More News in Brief
ARLINGTON, Va.—AAHomecare warned that providers must begin preparing for the start of Round 2 of competitive bidding with this note in a Friday newsletter: “It is AAHomecare’s understanding that the official notification of product categories will be the opening of bidding and the request-for-bids (RFB). Preceding that, product categories will be announced through sub-regulatory guidance or web announcement as part of the bidder outreach and education effort later this summer … We anticipate that the actual ZIP Codes defining each bidding area will be unveiled when registration for bidding opens.”

Based on a list of the top 20 DMEPOS categories by spending CMS officials gave out at an April 5 meeting of the PAOC, “It is imperative that HME providers begin determining their costs of providing these items and related services in order to provide an accurate bid,” the newsletter said.

For a list of the 20 products, see Round 2 Could Include More Products—Lots More, April 25.

Rehab Services Should Be Priority, Say Speakers at Capitol Hill Briefing
WASHINGTON—On Thursday, the ITEM Coalition, the Consortium for Citizens with Disabilities Health Task Force and the Coalition to Preserve Rehabilitation sponsored a congressional briefing on “The Importance of Rehabilitation in America’s Healthcare System” to point up the value of rehab services and devices for people who sustain injuries, or have disabilities or chronic conditions. The briefing was hosted by Reps. Cathy McMorris Rodgers, R-Wash., (and Jim Langevin, D-R.I., co-chairs of the House Bipartisan Disabilities Caucus.

Capitol Hill staffers heard from Gerard Francisco, MD, chief medical officer at TIRR Memorial Hermann Hospital and attending rehab physician for Rep. Gabrielle Giffords, D-Ariz., on the value of rehab services and therapies. Paul Tobin, president and CEO of the United Spinal Association, addressed the unique rehab and assistive technology needs of veterans and other populations. Jeanne Wilcox, PhD, professor of Speech and Hearing Science at Arizona State University, discussed the importance of habilitation services for children with developmental and intellectual disabilities.

During the Capitol Hill briefing, NCART Executive Director Don Clayback distributed information on the move to create a separate benefit category for complex rehab and technology. Both NRRTS and NCART said the briefing was an opportunity to raise awareness of the industry-backed initiative and CRT coverage in general.

Version 5010 Date Approaching Fast
CHICAGO—“Take a minute and think about where you will be six months from now,” says a new article on the Version 5010 transaction standards. Instead of getting ready for the holidays you could be scrambling to deal with the Jan. 1, 2012, implementation of Version 5010, according to Will You Be Ready? This Month’s Message from CMS, published in AIHMA’s (American Health Information Management Association) June newsletter. Version 5010 supports the new ICD-10 code sets and must be in place ahead of the changeover to the new codes in 2013. For information about ICD-10 and Version 5010, visit CMS’ ICD-10 website.

CarePoint on a Roll
CINCINNATI—In its continuing expansion, CarePoint Partners has acquired the infusion therapy segment of ArTex Medical, which serves Dallas and Texarkana, Texas, as well as Shreveport, La. CarePoint operates infusion and specialty pharmacies in 25 sites in nine states: Florida, Georgia, Louisiana, Massachusetts, Ohio, Pennsylvania, Rhode Island, Texas and West Virginia. The new acquisition is CarePoint's 13th since its formation in 2007. Last month, CarePoint picked up Premier Infusion, which has operations in the Austin, Texas, and Atlanta areas. In April, the company added Infusion Technologies' offices in North Miami and Tampa, Fla.

Mogul Is New CEO at DJO
SAN DIEGO—Michael P. Mogul became DJO Global’s new CEO, effective June 13. Mogul succeeds former President and CEO Les Cross, who becomes chairman. Mogul brings with him 22 years of sales and marketing experience in orthopedics, having served most recently as Stryker Corp.'s group president for its $3.5 billion worldwide orthopedics business. DJO’s brands include Aircast, Chattanooga, CMF, Compex, DonJoy, Dr. Comfort, Empi, ProCare and DJO Surgical.

Rotech Seeks Lien Notes Exchange
ORLANDO, Fla.—After raising $6.5 million in an offering earlier this year and another $290 million in a private offering, Rotech Healthcare has begun an exchange offer for up to $283.5 million aggregate principal of its senior second lien notes for an equal amount of privately held notes. The offer closes July 12 unless it is extended, according to a press release. In other company news, Wynnefield Capital Management reported in a June 9 SEC filing that it has acquired nearly 1.7 million shares, or 6.6 percent, of Rotech’s common stock. New York-based Wynnefield describes itself as “a value investor, specializing in U.S. small cap situations that have a company or industry specific catalyst(s).”

Durbin Co-Chairs COPD Caucus
WASHINGTON—Sen. Dick Durbin, D-Ill., is new co-chair of the Congressional COPD Caucus, which focuses on patients affected by chronic obstructive pulmonary disease. It is estimated approximately 24 million Americans, about half of them undiagnosed, are living with COPD. The caucus was created in 2004 by Sen. Mike Crapo, R-Idaho, as a bipartisan, bicameral way to raise awareness of the disease.

Smith Joins AAH Staff
ARLINGTON, Va.—AAHomecare has hired HME veteran Dan Smith as its new director of membership sales and marketing. Smith was formerly sales executive for OSI/Overland Solutions Inc., an outsource provider to the insurance market for audits, surveys, loss control and risk management. Previously, Smith served as vice president of membership at The MED Group for 12 years, and has also held positions with MK Battery, Advacare Medical and Everest & Jennings.

To revisit this news anytime during the week, check We welcome your comments. Drop a line to HomeCare Editor-in-Chief Gail Walker at
In observation of Independence Day, HomeCare Monday will resume publication July 11. Our staff wishes you and yours a safe and Happy Fourth of July!


The Compliance Team, Inc.

HomeCare provides its subscribers with timely legislative, regulatory and business news; in-depth analyses of various market segments; features on emerging issues and trends; practical how-to advice on business operations; best-practices profiles; and a constant stream of new product information. Subscribe to HomeCare magazine.

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