Casting Complete for Medicare Conference

Washington

The House and Senate last month set the stage for a conference that will decide the fate of Medicare reform. Casting Bill Thomas — chairman of the House Ways and Means Committee and an avid supporter of competitive bidding for durable medical equipment — as the overall conference chairman, lawmakers chose eight House members and nine senators to battle over the provisions of dueling prescription-drug packages.

On the Senate side, Republicans Chuck Grassley of Iowa, Bill Frist of Tennessee, Orrin Hatch of Utah, Don Nickles of Oklahoma and John Kyl of Arizona; and Democrats Max Baucus of Montana, John Rockefeller of West Virginia, Tom Daschle of South Dakota and John Breaux of Louisiana will push for a bipartisan bill that calls for a seven-year CPI freeze for DME, as an alternative to competitive bidding. The Senate bill also proposes reducing the reimbursement rate for Part B drugs from 95 percent to 85 percent of the “average wholesale price.”

On the House side, Republicans chose Bill Thomas of California, Billy Tauzin of Louisiana, Nancy Johnson of Connecticut, Mike Bilirakis of Florida and Tom DeLay of Texas will champion a bill that includes competitive bidding, a home health copayment and a reduction to the home health market basket. Democrats Charles Rangel of New York, John Dingell of Michigan and Marion Berry of Arkansas will join the House contingent.

Conference Could Drag On Indefinitely

President Bush is hoping that the conference will be a one-act play — that the conferees quickly will resolve the bills’ differences in time to deliver a final version to his desk by early September. However, the conference is shaping up to be an epic drama, as consumer groups, managed care organizations and the lawmakers themselves are finding fault with certain provisions of the bills.

Both bills “are inadequate in that they contain major gaps in coverage and may lead to a loss of coverage for those who already have health coverage from a former employer,” the AARP said.

In a July 8 letter to President Bush, Senate Democrats said they would not accept a compromise that coerces beneficiaries into leaving conventional Medicare to enroll in HMOs and private plans. The letter also demanded that any compromise bill include backup plans for beneficiaries living in areas where private plans are unwilling to provide a drug benefit, and provisions, such as low premiums and copayments, that ensure the drug benefit does not exclude the poorest seniors.

Two days later, House Republicans wrote their own letter to President Bush, calling for “premium support reforms” that would give providers incentive to develop cost-effective alternatives to traditional fee-for-service Medicare. Assuring wary seniors that these reforms would not leave out the poorest beneficiaries, the Republicans touted health savings accounts that Senate Democrats have promised to oppose.

All of these competing voices threaten Congress’ chances of reaching a compromise, said Seth Johnson, director of public policy at the American Association for Homecare in Alexandria, Va. “I think the dissatisfaction that the senior and other consumer organizations are discussing will slow down the process. This will be a huge campaign issue that [lawmakers] will want to point to when elections are in high gear,” and they are not about to ignore their constituents now, he said.

Consequently, debate on Medicare reform likely will continue through the August recess and into September and October, AAHomecare said. If that happens, appropriations bills could take precedence over Medicare reform, delaying a final prescription drug package indefinitely.

What Does This Mean for HME?

The Medicare-reform stalemate does not necessarily apply to home care issues, an AAHomecare spokeswoman told HomeCare July 15. In anticipation of a long conference, lawmakers were, at press time, considering tackling some of the less-central provisions of the Medicare-reform package before the August recess. In other words, conferees could decide on home care provisions during the early days of the conference.

Plan of Action

Preparing for a longer-than-expected lobbying push — but realizing that home care issues could be among the first the conference will resolve — AAHomecare still is focusing on supporting Sen. Grassley and the Senate bill. “We’re doing all we can to keep Grassley strong in his positions,” Johnson said.

In a July 10 conference call with members of the AAHomecare-led, anti-competitive-bidding CAMSET coalition, Grassley advised HME providers to call their House representatives and urge the lawmakers to tell Congressman Bill Thomas that competitive bidding is no good.

The association also met with senior White House officials July 15 to discuss the home care provisions contained in the two Medicare-reform bills. Although the officials said the President’s main objective is pushing his plan to inject market forces into the traditional fee-for-service model, they “seem to indicate an understanding that the competitive bidding provision in the House bill would not provide for the type of market-driven competition needed in the Medicare program,” AAHomecare said.

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