Ready for the Challenge

The home care industry is facing many challenges in 2004 due to enactment of the Medicare Prescription Drug, Improvement, and Modernization Act (MMA). The American Association for Homecare is well prepared. We have developed an action plan to ensure that policy-makers hear our message to preserve access to high-quality home care equipment and services. And we are putting our strategy in place, a multi-pronged approach that entails concerted efforts on Capitol Hill, in the administration and federal agencies, at the state level and in the public arena.

Relationship Building

Since passage of the new law, Capitol Hill and the administration have been in an “Okay, how do we move forward now?” mode. There have been lots of personnel changes in Washington, as is always the custom after a monumental legislative effort.

AAHomecare has used much of the time since the law passed to fortify relationships at the congressional, federal and state levels, and with industry stakeholders and consumer groups. Many of our members, too, have used the time to initiate or re-establish important, constituent-based ties to their members of Congress. The best time for such relationship-building is in the waning days of one session and into the next, when decision-making is not at its crucial, frantic pace.

Now Congress is back, a new administrator for the Centers for Medicare and Medicaid Services has been nominated and AAHomecare is moving ahead aggresively to address a number of priorities that are equally important to our membership.

A Long List of Issues

This year, we will focus our attention on the Federal Employee Health Benefit Plan (FEHBP) reductions, which will become effective in 2005. We want to stress with the White House and the Department of Health and Human Services our concerns about reduced access for patients. We also want to help them understand the significant differences between the private-pay FEHBP populations and the Medicare-eligible populations. In doing so, we hope to convince them of pursuing a “limited implementation” policy until a better assessment can be made on the impact on beneficiary access.

AAHomecare has begun meetings with the Office of Inspector General to discuss the Work Plan, which includes a study that will compare Medicare reimbursement with reimbursement under FEHBP. This study is of critical importance to HME suppliers who provide oxygen and other DMEPOS items to Medicare beneficiaries.

Additionally, AAHomecare’s Regulatory Committee and HME/Respiratory Therapy Council are documenting the disparities in reimbursement methodology between the Medicare program and FEHBP plans that make it inappropriate to compare reimbursement between the two programs.

We will also continue to document the need for, and value of, the clinical services and the administrative functions that are required to provide inhalation therapies to patients in their homes. These services are essential to the effective delivery of inhalation therapy to patients, and AAHomecare is working hard to preserve them.

In mid-February, association representatives met with the OIG to discuss the upcoming oxygen reimbursement study, to be published this spring, and asked the OIG to allow the industry to comment on this report before it becomes final.

AAHomecare is also developing coalition partners on the mandated change to the Average Wholesale Price for the Medicare Part B outpatient drugs issue. To ensure a favorable outcome, we are working with physician and patient groups to strengthen and broaden a coalition focused on preserving access to quality inhalation drug therapy and home oxygen services. We will work to develop data that can be used to influence the General Accounting Office report on reimbursement for inhalation therapies required under the prescription drug legislation. We are also working with HHS and our allies in Congress to — at least — ensure a fairer, more stable transition period from AWP in 2004 to the Average Sales Price plus-6-percent pricing in 2005.

The association is also advocating for the restoration of the 10 percent add-on for home health services in rural areas. This will help ensure that rural Medicare beneficiaries have access to home health services. We are working to deliver the message that future reductions in the market basket update and the expiration of the rural add-on pose a real threat to home health services at the expense of patients.

We met face-to-face with commissioners of the Medicare Payment Advisory Commission (MedPAC) during the holidays and into early January to discuss the home health benefit and to give the provider perspective as to how agencies are doing under the relatively new Home Health Prospective Payment System (PPS). Further, we also provided the commissioners with a white paper responding to MedPAC’s Medicare margin assertions.

AAHomecare is working to eliminate the 0.8 percent reduction to the home health market basket update for 2005-2006, and to counter MedPAC’s anticipated recommendation to Congress that there be no market basket update in 2005. However, this will be very much of an uphill battle given the recent revised increases by the White House to the overall cost of the new Medicare law.

The Power Wheelchair Clarification

Another area of immediate focus is the December 2003 power wheelchair clarification issued by the durable medical equipment regional carriers. AAHomecare is working to have the Centers for Medicare and Medicaid Services withdraw the clarification, as issued, so that the industry can have an opportunity to work with the agency on revising the coverage criteria for power wheelchairs, ensuring that the clarification is not applied retroactively and that it allows for limited ambulation of a patient.

We are also working with the RAMP (Restore Access to Mobility Partnership) coalition and others, including providers, manufacturers, consumers and physician groups, to make sure that we are able to achieve our objective. We have drafted a series of letters to CMS on this issue, and, at this writing, are scheduled to attend a listening session at CMS to voice our concerns.

Another area of interest with CMS is the regulatory effort to implement accreditation. We look forward to working with the recently nominated new CMS Administrator Dr. Mark McClellan. The relationship with CMS will be vital in continuing to open and strengthen lines of communication with the agency.

AAHomecare is also working with the OIG and members of Congress to see that OIG withdraws the proposed exclusionary rule, and we have submitted comments on this issue. We will also be meeting with legislators to ask them to urge OIG to withdraw the proposed rule given the current environment faced by DME suppliers of a CPI freeze and FEHBP reductions, and competitive bidding.

Involvement Is Critical

AAHomecare has targeted certain congressional members to help us achieve our goals for this year, but the industry’s active involvement is more critical than ever. The goal is to get legislators’ commitment to address the issues and demonstrate the value and impact of your business.

At the same time, we are preparing for a full-court press from AAHomecare members again this year. Our staff will schedule a series of Capitol Hill “Lobby Days,” and arrange for providers and beneficiaries to meet with their congressional representatives.

Yes, the challenges are great in 2004, but the opportunities are wide open. By working together in a unified manner, we will continue to educate Congress, the administration and consumers on the impact of these provisions and why it is so important that they be addressed.

Together, AAHomecare and our membership will confront these challenges head-on to accomplish all that is possible for our nation’s disabled and elderly.

Kay Cox is president and CEO of the American Association for Homecare, Alexandria, Va. For more information about the association and its legislative efforts, or about AAHomecare’s upcoming Legislative Conference or Lobby Day in Washington, D.C., visit www.aahomecare.org or call 703/836-6263.

AAHomecare’s 2004 Legislative Goals

• FEHBP Highlight the significant differences between FEHBP and Medicare payment methodologies and patient populations in light of lower expectations of Medicare payment reductions based on Federal Employee Health Benefit Plan pricing
• ASP Provide for a stable transition to the Average Sales Price plus-6-percent pricing for Medicare Part B drugs in 2005
• Home Health Rural Add-on Restoration of the 10 percent rural add-on for home health services
• Home Health Market Basket Update Elimination of the 0.8 percent reduction to the home health market basket update for 2005-2006
• Power Wheelchair Clarification Withdrawal of the DMERCs’ December 2003 power wheelchair clarification as issued to ensure that it is not applied retroactively and allows for limited ambulation of a patient
• OIG Exclusionary Rule Withdrawal of the proposed exclusionary rule, given the CPI freeze, FEHBP reductions and competitive bidding