LOUISVILLE, Ky. — Nationwide insurance carrier Humana has selected Apria Healthcare as its provider of choice for home medical equipment, according to the giant insurer's website.
Some small independents, which are already staggering under the threat of competitive bidding, amped-up audits and Medicaid woes, said the agreement is another big blow.
"I view this as being almost as threatening as competitive bidding to the independent providers in America," said Jason Rogers of Care Medical in Athens, Ga. "If this goes well, who is to say this won't be Blue Cross, Medicaid and who knows who else? It won't matter how good we are."
Humana said in a posted notice that it had established a long-term relationship with Lake Forest, Calif.-based Apria to provide its members' HME needs, "including home oxygen services, CPAP/BiPAP equipment and supplies, home tube feeding and other medical equipment services provided in the home." Apria will also be an in-network provider for outpatient negative pressure wound therapy, the insurer said.
"Please note that Humana's relationship with several home medical equipment providers is being terminated," the website noted. "Impacted Humana members will be informed of this change and encouraged to transition their services to Apria."
At press time, Humana officials had not responded to email or phone attempts to gain clarification. Apria's Lisa Getson, executive vice president of government relations, was out of the office but said she would respond to HomeCare.
NAIMES broke the news to its members in a newsletter last week, confirming the association had heard from Kentucky providers who had been asked to provide Humana with a list of patients who would need to be transitioned to Apria. "Kentucky independent suppliers and other national companies stand to lose thousands of patients to Apria under this arrangement," the association reported.
Some national providers targeted for termination began receiving notices in May alerting them to the Sept. 1, 2011, switchover, according to NAIMES. Smaller independent companies received a mailing this month.
"The way we were notified, Humana basically said, 'Here is a page of 20 data criteria. We want all of this filled out for each patient who has a piece of equipment with you,'" Rogers said. "They are going to turn that over to Apria. That is rubbing salt in the wound."
Rogers said there is confusion about which beneficiaries in Humana's scores of plans are affected or whether providers would be able to continue to service some patients in Humana's third-party plans. Calls to Humana with such questions have been essentially fruitless, he said.
"This is a very dangerous situation for the industry but a quietly simmering one," Rogers said, adding that "everyone in the industry should be aware of it and should be fighting it."
A Kentucky provider said he believes the agreement is nationwide and "extends to all lines of Humana's business … If 15 percent of your business is Humana, it will go away," he said. "I think it is for real, and it is a disturbing situation."
Representatives of the Kentucky Medical Equipment Suppliers Association contacted Humana after hearing the news and were told that small independents were still in the network, that it was not an exclusive contract and their pricing would be honored. But since those discussions, the provider said, he believes it is clear that beneficiaries have two choices: Go with Apria or go out of the network and come up with a 50 percent copay.
He is fearful providers billing out of network could see prices "50 to 60 percent below Medicare; you're looking at a $72 concentrator," he said, noting that is an impossible rate for small providers.
KMESA has taken the issue to the state's commissioner of insurance in hopes of a resolution. Kentucky is an "any willing provider" state, and providers are hoping that could negate Humana's plan in the state. As of Friday, sources said, there had been no response from the commissioner's office.
Mike Hamilton, executive director of the Alabama Durable Medical Equipment Association and senior adviser for the newly formed AtHomeServices Tennessee HME association, said that while Alabama providers have not so far been affected by the agreement, Tennessee providers have.
Blue Cross Blue Shield holds the power in Alabama with 93 percent of the market, he said, so Humana is not a big factor in the state. But providers in Tennessee have received letters of termination, he said.
"A lot of providers are going to be in some serious trouble," Hamilton said. "Apria might be buying up some bargains."