Bachenheimer: Oxygen Picture Isn’t Rosy

ATLANTA — With the caveat that “the situation could
change” at any point during the health care reform debate, Medtrade presenter
Cara Bachenheimer laid out the legislative and regulatory picture
for oxygen Tuesday morning — and it wasn’t exactly
pretty.

Bachenheimer, senior vice president of government relations for
Elyria, Ohio-based Invacare, made the following observations in her
early morning “Oxygen and Respiratory Update:”

• The House of Representatives’ health reform package includes two
  provisions that Bachenheimer believes were initiated by CMS. One,
  “ensuring the supply of oxygen equipment,” would move up to 27
  months the responsibility to service the oxygen beneficiary even if
  the beneficiary relocates.

  “There is no payment change,” Bachenheimer said. “Whoever is
  taking care of the patient at 27 months must be responsible.”

  Bachenheimer said the provision would not solve any of
  providers’ problems with the 36-month-oxygen rental cap currently
  in place. “This seems like a CMS ‘gotcha,’” she said.

  The second provision, “restoring the 36-month rental period in
  case of provider bankruptcy,” would allow beneficiaries with 24
  months of service to begin a new 36-month rental period with a new
  provider if their current provider goes bankrupt.

  “You wouldn’t have to have these fixes if you didn’t have an
  artificial cap,” Bachenheimer observed. “There is no other drug
  that is artificially capped.”

  She noted a proposal to reform oxygen would eliminate the
  36-month cap and spread payments over the time of medical need. It
  would set reimbursement for stationary oxygen at $80 per month,
  stationary and standard portable at $185 and stationary and OGPE at
  $227.

  However, Bachenheimer said, the proposal was not included in the
  Senate package. The sticking point, she said, was CMS’ migration
  problem and the fact that that the Congressional Budget Office
  scored the provision higher than was acceptable.

  That doesn’t bode well for oxygen providers, noting the reform
  proposal “is not likely to get in this year.”

  However, she stressed it is imperative that the benefit be
  reformed to include the service component; the Office of Inspector
  General’s 2006 report alleging that the government vastly overpays
  for oxygen continues to haunt the industry, she said.

  Medicare, Bachenheimer noted, is constantly asking, “Why are we
  paying $7,000 for a $500 concentrator?”

  “We’ve got to get out of that box,” she said, adding, “The
  government thinks they are overpaying because they don’t know what
  you are doing … We have to have long-term reform to this
  benefit.”

• “One of the scariest” provisions in the Senate Finance
  Committee’s proposal is the establishment of a Medicare Commission,
  which basically would determine policy, offer it to Congress for
  review and, if there was no congressional movement on the policy,
  CMS would be required to implement it.

  “This is like MedPac on steroids,” Bachenheimer said. “This
  takes out any leverage or lobbying ability we or anybody else has
  on The Hill and gives it to this ad hoc organization.”

• The General Accounting Office is working on yet another study on
  oxygen services that will be released in the spring, she said. That
  information could play into a Medicare bill, which Bachenheimer
  said is a certainty next year.

The grim picture prompted one session attendee to comment that
the industry needed to paint a more accurate picture for CMS and
Congress.

Bachenheimer agreed. The HME sector needs to get the message
across that “home-based care is the clinically preferred, most
efficacious solution to health care.”