No Time to Sit on the Sidelines

WASHINGTON — Andy Ingram has never been to an American
Association for Homecare lobby day before but, propelled by
numerous threats to his company’s survival, he’ll be there when
this year’s Legislative Conference begins today.

“Economically, it’s a hard time for all of us to be spending
that kind of money [to travel to Washington]. But if we don’t do
it, we’re never going to be able to correct some of these things,”
said Ingram, owner of Home Assist Medical Equipment in Laurinburg,
N.C.

Bill Cheek of Carmichael’s Home Medical Equipment in Monroe,
Ga., is another first-time attendee. “At this point, staying on the
sidelines is really not an option,” he said.

The two are among numbers of home medical equipment providers
scheduled to attend the conference, where headline speakers include
Senate Majority Leader Harry Reid, D-Nev., and Jonathan Blum,
director of CMS’ Center for Medicare Management.

The highlight for many attendees, however, will be the
opportunity to visit with legislators and encourage them to sign on
as cosponsors of H.R. 3790, the bill that would eliminate the
biggest threat of them all, competitive bidding.

Lisa Getson, executive vice president, government relations and
corporate compliance for Lake Forest, Calif.-based Apria
Healthcare, said the timing of this year’s conference couldn’t be
more important.

“With Round 1 competitive bids already submitted and CMS’ plans
to announce the pricing in the spring and winners in the fall right
before the mid-term elections, it is even more important for the
industry to make sure that legislators understand that the
[bidding] program is not being implemented in accordance with
Congress’ original intent,” said Getson, a Washington conference
veteran.

Underlying flaws in competitive bidding including “the pricing
methodology, lack of transparency surrounding financial
ratios/standards and past experience of the provider” remain big
issues, she said.

The bidding program will devastate the HME sector of health
care, according to most stakeholders. In an analysis of potential
job losses, Waterloo, Iowa-based VGM reported last week that “the
selective contracting program will reduce the number of local DME
providers by nearly 40 percent, and reduce the workforce in those
100 [Round 2] markets by more than 80,000 … The ‘domino
effect’ of destroying the infrastructure of the home medical
equipment delivery model will bring job loss totals [to] well over
100,000.”

That, combined with the deleterious effects of such things as
the 36-month oxygen cap, declining reimbursement, threats to the
first-month purchase option for power wheelchairs and a
manufacturer’s tax that would be passed on to providers, at least
in some portion, could be the death knell for hundreds, if not
thousands, of HME companies.

Ingram said he has already had to let two members of his
10-person staff go because his company revenue dropped 25 percent
last year even though demand did not.

“I had to cut two, and that’s 20 percent of my work force,” he
said, adding that he is going to talk to his legislators about job
loss — that of his former employees and also the potential
job losses described in VGM’s data.

“We’re going to tell them everything,” he said. “I actually made
a sheet of things we had to implement in the last several months to
stay afloat, things like changing to less expensive service
providers, making job cuts, redoing loans, limiting deliveries to
certain service areas. It’s a laundry list of 15 to 20 things.”

Cheek said he is going to Washington to fight for his employees
and his business.

He also employs 10 people. “These 10 people support 10 families
and quite frankly, this is not a time in our economy when we need
to put people out of work,” he said. “The biggest fear of myself
and our employees is that this could certainly close our
store.”

Barb Stockert of Merit Healthcare Accessories in Jamestown,
N.D., is adding some extra ammunition.

Stockert will present her legislators with copies of a letter
laying out the case for H.R. 3790 and signed by every chief
executive officer of every major health care system in North Dakota
(all of North Dakota’s 12 HME providers are associated with
hospitals).

“Having every major health system involved, they have to look at
it,” she said, noting that this is election year.

She will also be handing them photos taken by her delivery
drivers of the road conditions they routinely encounter in order to
service patients.

“Competitive bidding isn’t going to affect us directly,” she
said. “It will be the pricing that will affect us. We’re going to
have to accept the same prices as everyone else, yet we are
traveling 300 miles to service one patient. [The photos] will show
what our guys have to put up with.”

Stockert said she is going to campaign not only for more
cosponsors for H.R. 3790 (on Friday, the bill had 147), “but we
also need to get a companion bill in the Senate and we need to do
it now.”

Getson said her goal is to get to legislators “whose
constituents reside in Round 1 CBAs to alert them to the key dates
for 2010 and likely negative impact on their elderly constituents
and the home care providers that serve them.”

She pointed out that “Round 1 is already 4.5 times larger than
the demonstration projects, and it is hard to believe that CMS and
its contractor could possibly implement Round 1 on a single day.”
Round 2, she added, “will be at least seven times larger in terms
of market numbers alone, not to mention the variability among
markets in terms of population and geography.”

For his part, Cheek wants the legislators he talks with really
to understand the business of HME services.

“We provide a service. That’s what we do. I don’t think they
understand it at all,” he said.

It’s important that they do, he said.

“I love what we do, and I think most people who are in this
business are in it to care for people. We improve a lot of people’s
quality of life every day. We’re just a small company and I know
what we do with our 10 employees, and it’s something to be proud
of. It’s something to fight for.”