Confusion Over Oxygen Cap Involves More than Just Typo

ATLANTA–Ivan Rodriguez, owner of IR Medical Equipment in Miami,
is astounded at the hit he thinks the Deficit Reduction Act will
have on his oxygen business.

“I think it will affect at least 50 percent of my business,” he
said, “and maybe more.”

Like other oxygen providers across the country, Rodriguez
expressed shock and concern over the controversial act, which
includes a cap on Medicare rental of oxygen equipment at 36 months,
then transfers title to the beneficiary (see HomeCare
Monday, Jan. 9). And he has lots of questions.

“What does this mean if, after 36 months, a patient calls and
I’m not being paid? What do I do?” he asked. “What happens for
patients who have already been on oxygen for that long? And, God
forbid, what happens if one of my patients dies [after the
equipment title transfers]? How will this affect liability? Will I
be responsible?”

Such questions and a myriad of others about how beneficiaries
will receive ongoing care and services past the 36-month rental
limit have mushroomed from stakeholders since President Bush signed
the DRA Feb. 8. The American Association for Homecare pointed out
the measure does contain broad language regarding “payments for
oxygen” and “maintenance and service” after the title transfer, but
said it includes “no specifics.”

Compounding the confusion, while government officials say the
DRA is a done deal, some on Capitol Hill have differing opinions as
to whether the measure is even law. Because the Constitution
dictates that each chamber pass bills in identical form, a legal
debate emerged when the Senate and House of Representatives
approved different versions of the bill due to a clerical typo.

In a press briefing earlier this month, Health and Human
Services Secretary Mike Leavitt said he is presuming the DRA is
law, “and we’re moving forward on that basis.” But a federal
lawsuit challenging the legality of the act has been filed by an
Alabama attorney, and legal experts say others could follow.

On the DRA’s Heels
Adding another tangle, a separate proposal in the Bush
administration’s 2007 budget would shorten the oxygen rental period
from 36 months to 13 months. Although Congress would have to
approve such a measure, that proposal immediately drew its own fire
from an industry already reeling at the DRA’s new 36-month
limit.

“President Bush’s FY ’07 budget proposal on oxygen is so over
the top that I have had staff on Capitol Hill literally ask if the
13-month cap proposal was a typo,” said Cara Bachenheimer, vice
president of government relations for Elyria, Ohio-based
Invacare.

The company blasted both the president’s proposal and the DRA in
a formal response Feb. 15 that raised additional questions–such as
how beneficiaries would obtain back-up tanks to use in the event of
a power outage–and pointed out that giving patients responsibility
for their oxygen equipment and the services that go with it could
saddle Medicare with additional costs. Without a relationship with
a home oxygen provider to maintain equipment or monitor their
therapy, the company said, “many beneficiaries will end up in
hospital emergency rooms, or being admitted to a hospital where the
daily cost exceeds $3,600. In contrast, an entire year of home
oxygen therapy can be provided for about $2,784.”

“We need to capitalize on the outrageous nature of this proposal
and make sure every member of Congress can picture a frail, elderly
home oxygen consumer when they address this issue this year,”
Bachenheimer said. “That must be our mission–to ensure that every
member of Congress can visualize the consumer and have an
understanding of the real impacts of a 13-month rental cap.”

Last week, AAHomecare said it has commissioned a new study from
Morrison Informatics to collect the exact costs associated with
providing oxygen service.

More Questions than Answers
Meanwhile, Texas provider Dean Cheney, CEO of Dallas Oxygen,
wondered if he would have to give new equipment to beneficiaries
since they would own it in three years–and if he did, what would
he do with the used equipment in cases where a beneficiary died
before they assumed ownership?

“I can’t plan because, based on the information that has been
released, you don’t know enough,” Cheney said.

For example, 40 percent of Dallas Oxygen’s patients use
conserving devices, which Medicare doesn’t pay providers for, he
said. “So when you transfer title to the patient, who keeps the
conserving device?” Cheney asked. “If I keep the conserving device,
do I now get to charge for it? And who do I charge for it?

“Nobody has answers right now,” Cheney said. “It’s like I get to
play the game but I don’t know the rules.”

Gary Marnhout, regional vice president of Lexington, Ky.-based
Bluegrass Oxygen, said that after the 36-month cap, his company
won’t be able to provide many of the services it does now.

“When that cap hits and somebody’s 40 miles away from you, in a
rural area–and we have a lot of people in rural areas here–you
can’t be expected to drive 40 miles to take four oxygen tanks,” he
said. “It’s not going to work.”

The DRA is going to hurt a lot of people, Marnhout continued, as
well as confuse referral sources and probably force very small
companies out of business.

“It’s an irresponsible legislature that does this to the
American people,” Marnhout said.

Hobson-Tanner Picks Up Support
The Hobson-Tanner bill (H.R. 3559) has picked up three new
co-sponsors, AAHomecare reported last week. The addition of Reps.
Tammy Baldwin, D-Wis., Ed Pastor, D-Ariz., and Bennie Thompson,
D-Miss., brings the total number to 74.

For more information about the bill, which would ease some
effects of DME competitive bidding, visit the AAHomecare Web site
at www.aahomecare.org.

To learn more about Last Chance for Patient’s Choice, a 527
non-profit organization that plans to file a federal lawsuit
against the competitive bidding provisions in the Medicare
Modernization Act, visit www.lastchanceforpatients.org.