Cliff deal changes non-mail order rates, extends recoupment period

CUMMING, Ga., Jan. 2, 2013—According to the Accredited Medical Equipment Suppliers of America (AMEPA), the non-mail order diabetic supply sector did not fare well in the American Taxpayer Relief Act of 2012, also known as the “fiscal cliff” bill. Congress included legislation influenced by “inherent reasonableness authority” to apply national mail order single payment rates on non-mail order diabetic testing supplies. These are supplies that can be picked-up by Medicare beneficiaries in pharmacies and other home medical equipment stores, when the program begins in July. The upcoming changes are detailed in Section 636 “Medicare payment of competitive prices for diabetic supplies and elimination of overpayment for diabetic supplies.”

The legislation reads: “the payment amount under this part for diabetic supplies, including testing strips, that are non-mail order items (as defined by the secretary) shall be equal to the single payment amounts established under the national mail order competition for diabetic supplies.”

The new pricing will likely begin on July 1st, as stated: “The date described in this clause is the date of the implementation of the single payment amounts under the national mail order competition for diabetic supplies.”

It also appears that the bill will reduce non-mail order diabetic supplies to match the mail order supplies that were nationally cut by 9.5 percent in 2009.

The previous law stated: “in the case of items and services furnished in any geographic area, if such items or services were selected for competitive acquisition in any area under the competitive acquisition program… but only if furnished with such items and services selected for such competition and diabetic supplies but only if furnished through mail order, – 9.5 percent.” The new bill removes the words “but only if furnished through mail order.”

Although the bill has not yet been signed into law by the president, the language implies that the new prices will be in affect beginning April 1; as it states, “for purposes of determining the payment amount under this subsection for diabetic supplies furnished on or after the first day of the calendar quarter during 2013 that is at least 30 days after the date of the enactment of this paragraph.”

There was another section in the bill, Section 638, “Removing obstacles to collection of overpayments,” that extends the authority from three to five years to gain “correct recoupment.” Click here to read the DME-related changes in the bill. Visit AMEPA online at www.amepa.us.