Industry Unhappy with HME Targets in Bush ’07 Budget

WASHINGTON–In his $2.77 trillion FY 2007 budget proposal,
released last week, President Bush calls for a major bump in
spending to develop a nationwide, interoperable health information
network, including personal electronic health records for most
Americans by 2014. He proposes $169 million in health information
technology spending for the Department of Health and Human
Services, up from $111 million in the current year.

The president’s budget request from Congress also asks for $6
million for a Food and Drug Administration initiative called
“Critical Path to Personalized Medicine,” which would focus on
cutting-edge research methods and better designed clinical
trials.

But the budget also calls for some $36 billion in reductions to
Medicare and more than $1.5 billion to Medicaid over five years.
Additional proposed regulatory changes would reduce federal funding
for Medicaid by another $12.3 billion over the same timeframe.

A response from AAHomecare said the association is opposed to
several provisions in the budget specifically targeting home health
care, including a proposal to transfer ownership of medical oxygen
equipment to Medicare beneficiaries after 13 months, a freeze on
home health reimbursement and elimination of the ability to
purchase power wheelchairs in the first month.

“Continuing cuts to home care erode the cost-effective
infrastructure of home care that will be essential to the nation’s
health care needs, especially as baby boomers near Medicare
eligibility,” said Tom Ryan, AAHomecare chairman and CEO of
Homecare Concepts in Farmingdale, N.Y., in a statement issued
Wednesday.

“The expected growth in number of Medicare beneficiaries and
increasing length of time they will need health care services
should encourage policymakers to keep cost-effective care methods
such as home care in mind as they create budget policy,” he
continued.

According to the association, the proposed budget’s limit of 13
months on the oxygen rental period would exacerbate the recent
36-month cap on medical oxygen that was included in the Deficit
Reduction Act (S. 1932), which Bush signed into law on Wednesday.
(See story in this issue.)

The forced transfer of ownership of oxygen equipment places
unfair burdens and uncertainty on beneficiaries, AAHomecare said,
and the freeze on home health reimbursement is “unwarranted and
unwise, given rising costs for home health agencies and the widely
recognized value that home health care delivers to the Medicare and
Medicaid programs.”

Seth Johnson, chair of AAHomecare’s Rehab and Assistive
Technology Council and director of government affairs for Pride
Mobility, said the proposal to eliminate first-month purchase of
power wheelchairs is worrisome because they are provided to
beneficiaries with disabilities that are long-term conditions, and
more than 95 percent of power wheelchairs are purchased in the
first month.

“The RATC will work closely with Congress as they begin to
develop Medicare legislation this year,” Johnson said. “The council
is very concerned about the impact an elimination of the
first-month purchase option would have on beneficiaries and
suppliers and will work to educate Congress on the many reasons why
this is bad policy.”

Because it is up to Congress to decide whether to pass
legislation containing any provisions from the president’s budget
proposal, AAHomecare said, “it will be important for the home care
community to be vocal about its opposition to these proposed
changes.”