AAHomecare Members Fight MMA’s Reimbursement Changes

As Washington rushed to prepare for former president Ronald Reagan’s funeral, 200 industry stakeholders fanned out over Capitol Hill to drive the home care message.

During the American Association for Homecare’s Legislative Conference, held June 7-9, HME providers and manufacturers skirted hastily erected security fencing and crowd-control rails to keep appointments with 165 members of Congress and their legislative aides. Chief topics of discussion with the federal representatives were the DME reimbursement cuts and revised pricing for inhalation drugs mandated under the Medicare Modernization Act (MMA).

In meetings with the legislative aides for Georgia Sens. Zell Miller and Saxby Chambliss, Dave Hunter of Air Products Healthcare laid out a case against the 2005 transition to an ASP (average sales price) plus-6-percent pricing system for Part B respiratory drugs. “From a provider standpoint, what that really means is that the only reimbursement we would see above our cost is a 6 percent margin, which is not even going to be enough for us to deliver the medications.

“While we will continue to honor and support the patients we currently have in providing respiratory medications,” Hunter said, “we’re going to literally have to look at getting out of the business. We believe strongly that this is going to lead to an access issue.”

Phil Stone of Atlanta-based American Homecare Supply, another member of the lobbying group from Georgia, told the congressional staffers that he is concerned about the impact the FEHBP (Federal Employees Health Benefits Plan)-based pricing cuts to oxygen and other DME products will have on beneficiaries. “It’s getting to the point where we are going to have access issues,” he said.

WestMed Rehab’s Tim Pederson carried a similar message to all three of his state’s Washington legislators, including South Dakota Sens. Tom Daschle and Tim Johnson, and newly elected Rep. Stephanie Herseth. Pederson’s Rapid City business has 21 employees and serves 6,000 patients, some of them in outlying American Indian reservations.

“We do a lot of outreach to the reservation communities, and the margins are very tight,” he explained to Herseth. “If those [reimbursement] reductions are implemented, we may have to reevaluate the types of services we offer on an outreach basis. Now we do it because it’s the right thing to do … but we don’t make a great deal of return. We would like to continue to do it, but we have to do what’s best for our business as well.”

Throughout the day in meetings with officials from 34 states, AAHomecare members asked for support for H.R. 4491, a bill recently introduced by Reps. David Hobson, R-Ohio, and Harold Ford, Jr., D-Tenn., to repeal the FEHBP-based reimbursement cuts. After the lobbying effort, nine additional co-sponsors signed onto the bill in the House (see News, page 10). And after a meeting with the Pennsylvania delegation, Sen. Arlen Specter wrote a letter to CMS Administrator Mark McClellan setting out his concerns about the reimbursement changes. Specter chairs the Senate Appropriations Subcommittee on Labor, Health & Human Services. While political insiders say the chances for companion legislation in the Senate — or any changes to MMA — are slim in this election year, the industry is picking up other friends on the Hill.

A June 8 address by Sen. Blanche Lincoln of Arkansas related a personal experience with home care during her father’s battle with Alzheimer’s disease. “I’ve been your customer … I understand what [home care] has been able to do for my family and our ability to provide the quality of life and care for a lengthy amount of time in a setting where we wanted to be.

“You’ve got to make people understand that the options you provide are good options,” continued Lincoln, who is a member of both the Senate Finance Committee and the Special Committee on Aging. “They’re productive options; they’re economical options … for a large portion of the American population who are very interested in being able to manage their health care in a more direct way. I hope that you will … work with me to continue the discussion in Washington in terms of improving the Medicare reform bill that we have put into law.”

In Washington, Lincoln said, legislation “is not a work of art, it’s a work in progress.”

Idaho Sen. Mike Crapo drew loud applause in a final conference keynote when he told the audience that home care can play a vital role in the fight against chronic illness — and that the new payments for inhalation drugs may be inadequate. Crapo recently announced formation of the Congressional COPD Caucus, which also includes Sen. Lincoln and Reps. John Lewis of Georgia and Cliff Stearns of Florida, to educate the public about chronic obstructive pulmonary disease and promote policies to improve the lives of COPD patients.

In addition to lobbying, on June 9 conference attendees elected a new slate of AAHomecare officers, including Chairman Tim Pontius, president and CEO of Young Medical Services, replacing outgoing Chairman Joel Mills, president and CEO of Advanced Home Care; Vice Chair Tom Ryan, president and CEO, Healthcare Concepts; Treasurer Larry Higby, president and CEO, Apria Healthcare Group; and Secretary Todd Brason, CEO of Willcare Inc.