AAHomeCare Update
by Tom Ryan
July 8, 2016

The American Association for Homecare remains fiercely committed to reining in the competitive bidding program, to bringing about a less burdensome audit process and to our continued efforts to simplify the stream of requirements and procedures that stands between suppliers and patients. If you are a member of the association, or if you follow us through other channels, then you are no doubt familiar with our work in these major Medicare reimbursement-focused areas.

However, the HME community must also be prepared to adapt to new developments in health care delivery and reimbursement, and AAHomecare is taking a leadership role in making sure our industry is ready for these changes. I’d like to take this opportunity to let you know about some new initiatives that AAHomecare is spearheading to help providers meet the challenges ahead.

Payer Relations

As more Medicare beneficiaries are enrolling in Medicare Advantage plans and state Medicaid plans shift their patients into managed care systems, these payers are becoming increasingly important to HME providers.

AAHomecare is responding to these changes by adding Laura Williard to our team as senior director of payer relations. Laura brings more than 20 years of HME experience to this role, in which she will provide assistance to our members in navigating payer relationships and concerns while making sure these payers are properly aligned with CMS rules and regulations. She will also develop strategies and resources to help AAHomecare members successfully deal with Medicare Advantage audits. Laura’s credibility and experience dealing with many of these payers will help AAHomecare members build and better manage these relationships going forward, and will also promote consistent policies and practices from managed care organizations for HME.

Cost Study

HME providers know firsthand that a large number of factors and regulations affect the cost of doing business in this field. Many of you have done an exceptional job getting individual legislators to understand the full range of costs associated with providing equipment and related services through site visits and face-to-face lobbying. But, we need more than individual efforts to bring the full picture on costs into focus to help make a case for fair reimbursement rates.

To that end, AAHomecare has commissioned Dobson|Davonzo, a research firm with extensive experience in the health care arena, to determine the true cost of providing home medical equipment products and services to Medicare beneficiaries and other patients. Under the guidance of an advisory panel of HME providers, the firm is developing a survey to determine the cost of goods, clinical and nonclinical labor costs, administrative and overhead costs, delivery and travel, repairs and more for a representative set of product categories.

The survey, which will be deployed to a geographically diverse group of suppliers this summer, will be the foundation for an authoritative report that shows the true costs associated with providing HME products and services. This report will be shared with policy makers on Capitol Hill and at federal agencies, as well as with payers at every level, to make the case for fair and realistic pricing and regulation for HME. I believe this project will be truly impactful in educating these important audiences and also changing the perception of our industry.

New Model for Respiratory Reimbursement

The concept of paying for value-based outcomes is growing in popularity throughout health care, and this movement provides an opportunity to get away from relentless efforts to commoditize and cut reimbursement rates for HME. One area where the value-based approach appears to be a strong fit for HME is in the treatment of chronic obstructive pulmonary disease (COPD).

COPD is the third-leading cause of death nationwide, and is chronic, incurable, progressive and ultimately fatal. Hospital readmissions for COPD and related cardiopulmonary diseases are focal points for quality improvement and cost reduction initiatives sought throughout the health care field, and the continuity of care is essential for this vulnerable population. The HME industry is in a unique position to play a major role in maintaining care for COPD patients while lessening the need for more costly clinical interventions.

Responding to this growing interest in value-based payment models, AAHomecare is exploring the possibility of restructuring respiratory reimbursement through a modern, science-based, patient-centric and economically sound methodology for services pertaining to chronic respiratory management. I am excited about this project, because I believe that health care in America will increasingly move from fee-for-service to value-based models, and that the HME sector must be prepared to take a leadership role in helping shape this new environment.

The Bidding Campaign Continues

These new initiatives shouldn’t be taken as a signal that AAHomecare is dialing back on our work to maintain fair Medicare reimbursement rates and regulations. By the time you read this column, the HME community will have learned if legislation to allow additional time for further study of competitive bidding-derived cuts for rural providers has been successful. Whatever the outcome, it is clear that the bidding program will still need significant changes before it drives more of the HME community away from participating in the Medicare program, with seniors and individuals with disabilities suffering as a result. Do not expect AAHomecare to quit that fight anytime soon.