Complex Rehab Sector Hopes to ‘Move the Needle’ on Cut

ATLANTA — Struggling under a 9.5 percent reimbursement cut
that took effect Jan. 1, complex rehab providers are appealing to
legislators to reverse the cut, and they’re looking to consumer
groups to add muscle to the message.

“What we have heard from committees on Capitol Hill is that this
effort needs to be led by consumer groups. That is what is going to
move the needle on Congress taking action on this issue,” said Seth
Johnson, vice president for government affairs for Pride Mobility
Products, Exeter, Pa.

Under the Medicare Improvements for Patients and Providers Act
of 2008, the cut on Round One product categories was the payback
for Congress’ delay of competitive bidding. Complex
rehab was exempted from any future competitive bidding projects,
but was included in the cut.

Stakeholders, who are asking for a parallel exemption to the
bidding carve-out, have said that complex rehab providers operate
on slim margins — as little as 2 percent — and cannot
absorb a 9.5 percent fee reduction without some deep cuts of their
own to service and quality of products.

That is already occurring, some said.

“Certainly the choice of product has been much more limited than
it was,” said Jim Greatorex of Black Bear
Medical, Portland, Maine. “The other thing that we are doing
is, upon delivery with any custom rehab product, we are letting
folks know that if we need to do warranty service on any product,
it has to come into the shop or the people will be charged a
service charge.”

Black Bear has been working for two years to get people to bring
their products into the shop for repair and has a 75 percent
success rate, Greatorex said. “We’ve had good response to that,” he
said. But the product limitations are distressing to beneficiaries.
“We’re getting a little squawk back when folks [realize] they can’t
get the products they are used to,” he noted.

Greatorex has also challenged his employees to achieve a 12
percent sales increase without incurring any new overhead or adding
any new employees. “That is the other thing we have to do to remain
stable,” he said.

Black Bear Medical isn’t the only company cutting back.

“Providers … were forced to look at everything they do
that was not required by Medicare policy,” said Johnson. “Trial
equipment has largely gone away and repairs are not required, so a
lot of providers are not repairing chairs. Many are asking patients
to bring chairs into the company so they don’t have the travel time
and the cost [to and from the patient’s home].”

It’s even gone further than that for some providers, according
to Sharon Hildebrandt, executive director of the National
Association for Assistive and Rehab Technology. “Some providers are
thinking of selling. I would expect to see more consolidations in
the field when it comes to rehab,” she said.

In a recent HomeCare survey, more than 10 percent of
responding complex rehab providers said they would not remain in
the business (see “2009 Forecast Survey” in
HomeCare’s January issue).

The results of the cut, what Johnson calls “unintended
consequences,” have garnered the concern of consumer groups that
are getting frustrated calls from Medicare beneficiaries.

Last month the ALS Association sent a letter to the Senate Finance
Committee “pointing out the problems that have evolved with access
to service,” Hildebrant said. Both she and Johnson said more
consumer groups are expected to take similar action in the next
week or so.

That’s good news to Tim Pederson, president and CEO of WestMed Rehab, Rapid City, S.D.,
who heads the American Association for Homecare’s Rehab and
Assistive Technology Council. “No matter how good our argument is
as providers, it has the potential to come across as self-serving
if we are the ones to ask for that,” he said.

Input from consumer groups on the effects the cut has on their
members will likely carry the most weight with members of Congress,
he said. “There’s very little we as providers can do to lift the
ball on this,” he said.

But that hasn’t stopped advocates from at least trying to push
the ball forward. Pederson said RATC and NCART are seeking ways to
coordinate their priorities for the coming year and keep the
momentum going.

“The number one priority for AAHomecare [regarding complex
rehab] is to achieve a parallel exemption and it is the number one
priority for NCART, as well. If we have a united effort and a
concerted effort, then we have an opportunity to do something about
this 9.5 percent cut,” he said.

But Pederson cautioned against thinking the cut could be
repealed anytime soon. “We’re working on this, but we need to
accept the constraints of our current reality right now and make
plans to deal with it. We don’t see a comprehensive solution
forthcoming in the near future,” he said.

Pederson added he doesn’t expect legislation that could carry a
repeal of the cut to come until later in the year, and that could
be the massive Medicare reform package.

Hildebrandt said stakeholders are looking for congressional
supporters of the idea. “We are trying to find champions on the
Hill who will help us with this issue,” Hildebrandt said. “Right
now, they are very preoccupied with the economic stimulus
package.

“Unfortunately,” she added, “it’s a waiting game right now.
We’re trying to find champions knowing that the cut is in effect
and is wreaking its havoc and not wanting to wait, but being told
that no one wants to focus on it as this particular point.”

Greatorex said he has hopes that the attempt to overturn the cut
will eventually be successful “It’s too early to tell where the
chips are going to fall. I don’t have a good read. But based on
past experience, I would say we have a fairly easy-to-understand
case and it should resonate with most legislators.”

Still, he sees a tough year ahead. Medicaid, he noted, is
following the Medicare path, so cuts are looming there.

“I think people are getting tired of fighting,” Greatorex said.
“Most of us just want to … do a real business plan and get
back to doing business. It’s fatiguing. Why should you have to
fight for your money all the time? I have high hopes that, at the
end of this year, we would have some stabilization.”