ATLANTA — Cara Bachenheimer is swift to identify the top three issues for the home medical equipment industry: “Competitive bidding.”
“Competitive bidding is number one, number two and number three,” said Bachenheimer, senior vice president of government relations for Invacare Corp., Elyria, Ohio. “We’ve got other issues. But if you’re not around, it doesn’t matter how much CMS is paying for oxygen.”
On Friday, CMS laid out its schedule for the rebid of Round One (see top story this issue). If the national competitive bidding program goes through as the agency plans, it has the power to eliminate up to 90 percent of Medicare providers in the target areas and severely cripple beneficiary access to products, experts have predicted. It is the industry’s most critical battle, Bachenheimer said.
A recent survey by the Committee to Save Independent HME Suppliers showed providers agree. With 242 companies from 42 states weighing in to rank the industry’s most important issues, competitive bidding came out on top (followed by repeal of the cap and restoration of the 9.5 percent cut to complex rehab).
After its rocky implementation, Round One of the bidding project was halted last July when Congress passed the Medicare Improvements for Patients and Providers Act. Among other things, MIPPA directed CMS to fix the laundry list of procedural and other problems plaguing the project.
Stakeholders had hoped the Obama administration would repeal the mandate for competitive bidding. But a delay in confirming a new secretary for the Department of Health and Human Services--Kathleen Sebelius only assumed that post in late April--and the continued absence of a CMS administrator have worked against that possibility.
“Clearly, we have been hampered,” said Bachenheimer, adding that CMS’ Friday announcement puts the HME industry in peril. “It appears that CMS is moving forward with the exact same language [on bidding] as it did last year,” she said. “They said in their press release that MIPPA didn’t make any meaningful changes.”
Bidding Needs a Big Fix
The two most crucial areas that need to be reformed, Bachenheimer
said, are supplier selection and the bid process. The selection
process needs to be “more rational” and guarantee that
providers are 100 percent legitimate, she said. As it stands, the
bid process encourages desperate bids, reduces the number of
suppliers and distorts the real competitive system, she said.
“Those are the two areas that need to be changed,” Bachenheimer said, but “CMS has made it clear through the [interim final rule] and other press releases since July that there is absolutely no change in those areas.”
It is imperative that providers muster their muscle to fight the project, she continued.
“People ask ‘What should I do right now?’ The reason we were successful last year is that we had an incredible grassroots effort,” Bachenheimer said. “We need to be doing the same thing right now … Timing is of the essence. The urgency is now to be communicating with members of Congress.”
In Washington today through Wednesday for the American Association for Homecare’s annual Legislative Conference, some 250 participants are expected to request that legislators once again halt the bidding program. Other HME groups are also urging their members to connect with legislators to make the case for eliminating the DMEPOS bid.
“We have to continue our political support [for those who supported MIPPA], the letters, the phone calls,” said Bachenheimer.
Beth Bowen, executive director of the North Carolina and Virginia state associations, agreed. “It is vitally important that we continue to have face-to-face meetings with our members of Congress as we build that relationship by email, phone and site visits throughout the year,” she said.
That may be the only way to derail competitive bidding, according to Bachenheimer, who does not believe CMS will change the program on its own; that mandate will have to come from Congress.
“Unless someone comes in and tells [CMS] they have to make changes, that’s not going to happen,” she said. “Clearly, you have to tell CMS what they have to do. It has to be an extremely detailed legislative mandate saying, ‘You have to make these changes.’”
There is some support on Capitol Hill for eliminating or, at the least, reforming the bid program, she pointed out. “People who supported [MIPPA] last year are actually surprised that CMS is moving forward in the same manner as last year. [They] are irritated [because] they intended for CMS to take a more serious look and actually make some significant changes,” Bachenheimer said.
Arguments that Resonate
In her view, CMS is not complying with the spirit of the law.
“It wasn’t just delay the program for delay’s
sake. The intent was to take a look and say, ‘What went
wrong?’
“That’s the message right now for Congress: CMS hasn’t made any changes and is expecting a different outcome. That’s the message we need to keep making and make sure folks on the Hill understand,” Bachenheimer said.
Also, she pointed out, CMS has the ability to add the “any willing provider” provision to the project. That would mean any provider willing to be reimbursed at the new competitive bidding rate could continue to serve Medicare patients.
“The Obama administration has that in its Medicare Advantage plan,” Bachenheimer said. Providers can argue the merits of having consistency in policies, she said, adding: “It’s a way to establish pricing at better rates without this sort of arbitrary fiat that certain providers cannot participate in the Medicare program.”
Then there is the argument that competitive bidding will eliminate a huge percentage of providers from the program, resulting in companies going under and loss of jobs, something the Obama administration does not want to see at a time when the economy is barely breathing.
Such arguments resonate with Democratic leaders on the Hill, Bachenheimer said.
But here are significant hurdles, she said. “We have a lot more sympathy on the House side than the Senate,” she said, noting that Sen. Max Baucus, D-Mont., head of the powerful Finance Committee, has repeatedly stated his support of competitive bidding.
There is also the issue of cost. “If we get support to repeal the program, it is going to be a ‘pay-for’ situation,” Bachenheimer said. “Is the industry going to be able to afford what they seek? That’s so critical; if we can’t get a repeal or the industry is not willing to pay for repeal, what are our other options?”
The fact that providers took a nationwide 9.5 percent reimbursement cut in 10 product categories only paid for last year’s delay of competitive bidding, she noted. So whatever happens, the industry will have to pay for it. And the cost of delaying the program while it is reformed would be less than eliminating it altogether.
“We are between a rock and a hard place, but there are works in progress at this time,” Bachenheimer said. “I can’t say anymore.”
Beyond Bidding
Beyond competitive bidding, she said, the biggest issue is oxygen.
“I am very concerned that oxygen cuts are going to be
resurrected by the Senate Finance Committee,” Bachenheimer
said.
She champions the Home Oxygen Patient Protection (HOPP) Act (H.R. 2373), which would eliminate the oxygen rental cap, but believes it must be melded with an oxygen reform bill.
On Friday, AAHomecare issued a background paper for legislation to reform the Medicare oxygen benefit. “Budget-neutral oxygen reform legislation will ensure consistent and comprehensive services for Medicare beneficiaries while eliminating the current 36-month reimbursement cap and establishing a bundled payment for the duration of time in which home oxygen therapy is provided,” the association said.
Industry stakeholders hope the plan, which was devised by the AAHomecare New Oxygen Coalition, can be included in legislation this year. That could be in the health care reform package Congress is working feverishly to assemble. The Obama administration wants health reform by the end of the year, and both the House and Senate have said they want plans finalized by August.
“Ideally, we will get both bills and they will be combined in the health care package this year,” Bachenheimer said. “While CMS is fixing the payment issue, you immediately fix the 36-month cap issue.”
The carve-out of complex rehab from the 9.5 percent reimbursement cut could be harder. “I’d be kidding if I said it’s not going to be a difficult job,” Bachenheimer said. Legislators maintain that the industry agreed to the cut last year to pay for the delay of competitive bidding, she explained, and asking for the carve-out is akin to reneging on the agreement.
In any case, there is a window of time that narrows daily.
“The train is moving,” said Bachenheimer. “The House has a pretty aggressive schedule--health care reform language released in two weeks, mark-ups to follow.”
Providers need to be out there talking to legislators and making the case for fair legislation and regulations, she said.
That’s exactly what Bowen and her team--22 providers from North Carolina and 12 from Virginia--plan to do at the AAHomecare lobbying conference, she said. “Obviously, we will be asking for congressional support on the HOPP Act, assistance to the complex rehab companies and elimination of the competitive bidding program. We have a lot to accomplish!”