Industry Leaders: Get Ready for a Stormy Year

Storm clouds heavy with further cuts for HME are gathering overhead, five of the industry’s top thought leaders warned providers at Medtrade, but there is a ray of hope for the future.

It depends, though, on providers taking a stand.

This year, Medtrade kicked off its annual fall expo and conference with a keynote address featuring five industry veterans: Cara Bachenheimer, senior vice president of Elyria, Ohio-based Invacare; Georgetta Blackburn, head of government relations for Blackburn’s Pharmacy in Tarantum, Pa.; Alan Landauer, owner of Landauer Metropolitan, Mount Vernon, N.Y.; Scott Meuser, chairman and CEO of Pride Mobility Products; Exeter, Pa.; and John Miclot, CEO of Philips Home Healthcare Solutions, Murrysville, Pa.

The panel was moderated by Tyler J. Wilson, president and CEO of the American Association for Homecare.

Speaking to more than 1,500 HME providers and other show attendees crammed into the Sidney Marcus Auditorium of the Georgia World Congress Center in Atlanta, the panelists provided a state-of-the-industry overview that briefly revisited the successful effort to delay competitive bidding, the upcoming 9.5 percent reimbursement cut on round one products, the impending 36-month oxygen reimbursement cap and HME’s dismal image.

But the bulk of their comments went beyond those issues to what providers could expect in 2009. With the tanking economy, health care in general is likely to take a big hit next year, the panelists said. And the HME segment in particular, plagued with the growing incidence of fraud and abuse, could be in for more than its fair share of cuts, the speakers agreed.

Landauer noted the HME sector needs to be more active than other health care sectors that compete for dollars and attention in Washington and, at the same time, must be realistic about what can be achieved in this environment.

“Our industry is low-hanging fruit,” he said.

Going forward, Landauer added, home care providers will need to offer solutions to policymakers in addition to advocating for stronger home care policy.

“Cuts to health care are going to be huge,” predicted Bachenheimer. “We need to take a much more aggressive, more constructive stand.”

Historically, Bachenheimer said, the HME industry has always assumed a defensive position. The exception was the competitive bidding battle, when providers, outraged at the flawed project that threatened to decimate their businesses and curtail beneficiary access to appropriate products, took the issue to legislators.

While competitive bidding is not dead, most legislators don’t think it is a good idea, she said. Still, the perception persists in Congress that the industry is overpaid, and “we have to tackle that head on,” Bachenheimer said.

Already, AAHomecare has issued a 13-point plan to fight fraud and abuse. Landauer said rulemakers are looking to the industry not only for solutions to contain fraud but also some way to curtail skyrocketing Medicare costs.

The industry has those answers, Bachenheimer said.

“We have better ideas than the people on Capitol Hill,” she said, adding that those in the industry know what works and what doesn’t. “We have to step up to the plate [with those ideas].”

Some of the ideas for cutting costs could revolve around the increasingly sophisticated product technology that is surfacing. Philips’ Miclot said he sees the move to change the health care system as potentially positive.

“Health care reform can be an opportunity,” he said, noting that the HME industry has the technology to allow people to be well cared for in the home and thus save health care dollars.

Miclot himself is banking on the success of providers in the ever-changing environment. He announced during the panel discussion that he is leaving Philips to become CEO of Clearwater, Fla.-based CCS Medical, a nationwide provider of diabetes, ostomy, wound care, nebulizer and incontinence supplies.

For his part, Pride’s Meuser said it is critical that the industry find a way to impress on regulators and legislators alike the importance of the HME industry’s services to beneficiaries. “Our service component isn’t recognized or appreciated,” he said, suggesting that AAHomecare sponsor a study on the service aspects of the industry.

“We’ve had an era of mutual mistrust [with CMS], Meuser said. “How do we end the war? How do we create an era of trust? We can’t just continue to dodge bullets.”

Verifiable data is what helped win the competitive bidding delay, added Blackburn, noting in that effort, providers went to their legislators with concrete statistics, not simply emotion.

“We need to change our designation from ‘supplier’ to ‘provider,’” she said.

The service component is an issue in fighting any further effort on the part of CMS to implement competitive bidding, as well as the 36-month cap on oxygen reimbursement.

“We have to have a different way of paying for services that pays appropriately for home care,” Bachenheimer said, adding that the value of home care must become central in every message to legislators and regulators.

“It’s economical, physician-preferred, patient-preferred,” she said. “We have every kind of positive story to tell. We’ve got to get out there and tell them. We’ve got an opportunity out there with a new administration, a new Congress.”

The industry is also hoping to get consumers involved. During a fundraiser at Medtrade, AAHomecare raised $75,000 to help fund a public awareness campaign promoting the mission of the home care industry.

Blackburn challenged listeners to educate CMS.

“Empower someone in your business to speak out,” she said. “Let’s find our voice and use it collectively. Let’s do it together.”