Complex Rehab Stakeholders Worried about ‘Magnitude of Pain’

ATLANTA–With just a small window of time before the Jan. 1,
2009, implementation of a 9.5 percent reimbursement cut, complex
rehab stakeholders are uniting to build a case for exemption from
the reduction.

On Wednesday, the Rehabilitation Engineering and Assistive
Technology Society of North America sent a letter to members of the
U.S. Senate pleading for exclusion from the pay cut mandated by the
Medicare Improvements for Patients and Providers Act, which also
delayed competitive bidding.

The RESNA correspondence follows a Sept. 19 letter sent by the
American Association of People with Disabilities to Sen. Max
Baucus, D-Mont., chairman of the powerful Senate Finance Committee,
expressing concern about the impending cut.

“Consumer groups have weighed in and now we have
disability groups that have weighed in,” said Seth Johnson,
vice president for government affairs for Pride Mobility Products
in Exeter, Pa. “The clinicians and the physicians that make
up the RESNA membership … are talking specifically about the
impacts they know this is going to have on beneficiaries who need
these complex rehab power wheelchairs and the services that go
along with those products.”

While Congress elected to exempt complex rehab from any future
competitive bidding program, it did not exclude the segment from
the 9.5 percent fee schedule reduction that will be applied Jan. 1
to the products included in round one of competitive bidding.

Stakeholders have said that complex rehab providers operate on
slim margins–of as little as 2 percent–and cannot absorb a 9.5
percent fee reduction without deep cuts to service and quality of
products.

“We are concerned that with the impending 9.5 percent
payment reduction, complex rehab suppliers will be forced to make
significant adjustments to their business practices that will
directly impact the services they provide,” RESNA’s
letter said.

Some of those impacts could include decreased beneficiary
access, decreased access to demo/trial and simulation equipment,
substitution of recommended products, less robust products and a
decrease in essential services, according to the organization.

“[The fee reduction] will jeopardize many
beneficiaries’ access to the full range of products and
services necessary to meet the unique and individual physical and
medical needs of many people with disabilities,” AAPD said it
its letter. “People with severe physical disabilities often
need a power wheelchair that is specifically designed so they can
maintain independence. With the current provision, many power
wheelchair users will not be able to receive adjustments, repairs,
replacement parts and access to the full range of products
available to make modifications to their current power
wheelchairs.”

The probable impact on quality and accessibility was borne out
by a recent survey sponsored by the National Coalition for
Assistive and Rehab Technology. According to the 184 complex rehab
companies that responded to the survey in September, “the
impact on revenue and profitability will be reflected in both the
services provided by complex rehab companies and product choice
available to people with disabilities,” NCART officials
said.

According to the survey:

–77 percent of the companies reported that the reimbursement
cut would affect 20 percent or more of their revenue;

–51 percent said it would affect 40 or more percent of their
revenue;

–66 percent said profitability would decrease by up to 20
percent;

–87 percent said the reduction would either reduce or eliminate
altogether their off-site assessments and evaluations;

–88 percent would reduce or eliminate providing demonstration
and trial equipment;

–95 percent would have to reduce or eliminate product choices;
and

–91 percent said their ability to perform repairs and servicing
at the customer’s home would be affected.

Sharon Hildebrandt, executive director of NCART, said she was
prepared for providers to say they would be adversely affected by
the fee reduction, but the “magnitude of pain” was a
surprise.

“I think I expected that half of the companies would show
an impact, when in fact it was [far greater],” she said.
“The margins are really quite small so there is not really a
whole lot of wiggle room in there to digest 9.5 percent cuts. Their
options are really just to change the product or cut
services.”

Already, she said, providers are steeling themselves against the
looming cut by establishing formularies. For example, Hildebrandt
said, “They are not including all the bases that they have in
the past for power wheelchairs.”

As well, she said, some providers have said the cut will force
them out of business. “I think we’ll see more
consolidation, bigger [companies] coming in and buying up the
smaller ones,” Hildebrandt said.

In spite of what could be a devastating effect on both
beneficiaries and providers, both she and Johnson believe the
chances are slim that the cut will be either stalled or
canceled.

“I don’t see an opportunity to do anything for this
year. We’ll have to do it next year with the next
Congress,” said Hildebrandt.

“It is going to be extremely difficult to get anything
done before the implementation date,” said Johnson, noting
that Congress has adjourned because of the Nov. 4 election.

However, he said, “We hear that Congress is going to come
back for some kind of lame duck session.” The RESNA and AADP
letters could help jumpstart support in Congress and that would
improve the chances for an exemption, he said, adding: “But
there is clearly not a vehicle to attach this to at this
time.”

The chances are relatively good, both Johnson and Hildebrandt
said, that, like competitive bidding, the fee reduction will be
implemented, then possibly pulled back.

“Unfortunately, it looks like that might have to
happen,” Hildebrandt said.

She is already considering a second survey. “I sort of
envision us doing a comparable survey once we get into 2009,”
she said. “This one was in anticipation of the cuts. Once we
get to 2009, I’d like to see us do another survey to see what
the impacts of the cuts [really are].”

It’s those results, she believes, that might speak most
strongly to Congress. “Anecdotal evidence doesn’t do
it. It isn’t that helpful. They want to see the actual
numbers,” she said. “They want to know in actuality
what is happening, and we owe them that. If we say this is going to
happen, we have to put our money where our mouth is and not just
cry wolf.

“If it doesn’t happen,” she continued,
“then we have no basis for seeking an exemption for the 9.5
percent reduction.”

Like other complex rehab stakeholders, however, Hildebrandt
doesn’t doubt that there will be damage to both providers and
beneficiaries, but especially to the latter.

“Ultimately, it’s the consumer that will suffer.
Providers will cut back as much as they can, but it’s the
consumer who will be affected,” she said.