New Study Documents Cost of Home Oxygen Services
WASHINGTON--More than 40 congressional staffers crowded Room
S-120 in the U.S. Capitol June 27 for a briefing on home oxygen
therapy--and its costs.
Led by Rep. Tom Price, R-Ga., a physician, the session centered
on a new study commissioned by AAHomecare that shows services
account for the lion's share of costs in providing home oxygen--72
percent--while equipment represents only 28 percent.
In late May, Price, along with Rep. Joe Schwarz, R-Mich., also a
physician, introduced a bill to repeal the oxygen provision in the
Deficit Reduction Act, which caps Medicare oxygen rental at 36
months then transfers equipment title to the beneficiary (see
HomeCare Monday, June 5).
Conducted by independent research firm Morrison Informatics,
Mechanicsburg, Pa., the new study shows that services including
delivery, patient assessment and education, routine safety
inspections, maintenance, ongoing support including refills,
emergency services and related expenses such as regulatory
compliance contribute to the majority of the costs in providing
home oxygen therapy.
Morrison based its research on a survey of 74 home oxygen
providers that collectively serve more than 600,000 beneficiaries,
more than half of the Medicare population receiving oxygen at home.
According to the study, the average cost per patient, per month,
for home oxygen therapy is $201.20, with $55.81 of that total for
equipment and $145.39 for services.
"The study shows that, contrary to some perceptions, home oxygen
therapy involves much more than a piece of equipment," said Tom
Ryan, AAHomecare chairman and CEO of Homecare Concepts,
Farmingdale, N.Y. "It is time that CMS and Congress recognize that
the services documented in the Morrison study represent the
industry standard of care in the United States, regardless of payer
source. Managed care, Medicaid and Medicare patients alike all
require the same service categories.
"A national Medicare policy that does not account for the many
services associated with oxygen therapy shortchanges both the
patient and the provider," Ryan said. "As a result, up to a million
Medicare patients who require medical oxygen may find breathing
even harder than it already is."
Price said the DRA mandate, which forces patients to own the
equipment, is "extremely short-sighted from a clinical and cost
perspective." Before the last-minute cap was added to the DRA, he
noted, home oxygen patients had a "safety net" of choosing whether
to manage their respiratory care after 13 months.
Industry leaders also have argued that many beneficiaries may
not be able to take care of their equipment or to pay for its
maintenance. The DRA policy change raises numerous patient safety
issues, they say, because it effectively severs the
patient-provider relationship. The physicians' bill, the Home
Oxygen Patient Protection Act (H.R. 5513), would return ownership
of the equipment to providers.
"What matters is who makes the equipment function correctly. It
is the difference between life and death," Price said.
The bill has picked up a flurry of co-sponsors in the past two
weeks, bringing the total to 29. If it doesn't move in the 109th
Congress, Rep. Schwarz has vowed he will introduce the bill again
To download a PDF of the Morrison Informatics study, called "A
Comprehensive Cost Analysis of Medicare Home Oxygen Therapy," visit
www.aahomecare.org. To view H.R. 5513, the Home Oxygen
Patient Protection Act, click here.