Providers Say Fee Cut Could Force Them From Market

Brentwood, Tenn., and Lake Forest, Calif.

Two of the nation’s largest providers have expressed concerns about a proposed reduction in CMS’ dispensing fee for inhalation drugs, warning that it could force some home care companies to exit the market.

If the service fee for providing the inhalation therapies drops below the current $57 per month, “few suppliers, if any, will be able to afford to provide these drugs at what will amount to be a substantial financial loss,” according to an Aug. 8 statement from American HomePatient. The Brentwood, Tenn.-based company, which operates 274 locations in 35 states, said providers including AHP “could be forced to exit the inhalation drug business depending on the magnitude of a reduction in the dispensing fee.”

Lawrence M. Higby, CEO of Lake Forest, Calif.-based Apria Healthcare — which serves patients in all 50 states — said providers have not even had enough time to adjust to the drugs’ 2005 reimbursement structure.

“We are very concerned that after only six months, [CMS] would contemplate a reduction to the dispensing fee when CMS has not, to our knowledge, performed any additional studies, surveys or pharmacy site visits that would support such a decision,” Higby said in a statement issued Aug. 8. He added that it could take a year on the new reimbursement structure before “reliable and predictable data may be gleaned.”