Dealing with the Ups and Downs

There are few thrills that rival the excitement of riding a roller coaster, but riders must have a strong stomach, remain calm and, at times, be able to scream very loudly. The same could be said of the market for home oxygen therapy.

A decade of reimbursement cuts and legislative changes has forced providers and manufacturers to look at new devices and delivery modes, all while keeping a focus on patient care. At the same time, fuel and labor costs have increased, placing additional burdens on providers.

Legislatively speaking, declining reimbursement is still a concern, but there are a few nuggets of hope.

“The good news is that there's not much opposition to repeal of the title transfer provision of the Deficit Reduction Act. The Bush administration and both sides of the aisle in Congress agree that the title transfer provision was a mistake and represents potential safety and regulatory issues for beneficiaries and their families,” explains Robert D. Hoover, Jr., MD, MPH, FACP, chief medical officer of DeVilbiss Healthcare.

“The bad news is that oxygen reimbursement cuts are still squarely in focus from both the Senate and the House of Representatives as they look for ways to pay for the ‘physician fix.’”

At press time, Congress was still wresting with the issue, so whether the industry will see further reductions in Medicare payment for home oxygen therapy remained a question. However, one thing is certain: It will not increase.

“The one certainty within oxygen reimbursement is that it has always been under the microscope and a target for payment reductions,” says Daryl Risinger, Inogen's vice president of marketing. “The ‘next’ reduction in reimbursement has been the topic of conversation for years, and no one I've spoken with believes the reimbursement pendulum will swing in the other direction.”

According to Jay Vreeland, Respironics' U.S. director of marketing, ongoing discussions in Congress regarding payment for oxygen and the uncertainty of the effects of competitive bidding are keeping the industry in a state of uncertainty. He says the landscape for providers is going to change, but how exactly no one yet knows.

“There has been a lot of speculation due to the reimbursement pressures and competitive bidding, but how competitive bidding will play out has not yet been determined,” he says. “Future potential cuts to reimbursement or changes to length of reimbursement have been acknowledged by the industry, but the severity or magnitude of the changes is yet to be clearly understood.”