Breathing Room

Many successful HME providers have maintained a certain work plan when it comes to providing oxygen therapy: Take care of the patient first and figure out how to get paid later. Although this may sound like a poor approach to sustaining a successful business, in the HME industry it has enabled providers to increase patient and referral source satisfaction, thus increasing orders and market share.

But current and proposed legislation surrounding the oxygen industry is changing this attitude, leaving providers with more questions than answers.

The Deficit Reduction Act of 2005 caps the rental period for oxygen equipment at 36 months, at which time title for the equipment transfers to the beneficiary. Prior to the DRA, oxygen equipment was rented indefinitely.

The industry has rallied strongly against the cap, arguing that it could put beneficiaries in danger if they are responsible for upkeep and maintenance of oxygen equipment — a service many companies provide as part of the rental fee.

Last year, the Home Oxygen Patient Protection Act was introduced to strike the rental cap, but Congress took no action on the bill before it adjourned. The legislation has since been reintroduced, and stakeholders are hopeful about its prospects this term.

But in his proposed budget for 2008, President Bush recommended that the rental period be restricted even further, to just 13 months.

“I won't dispute the fact that it's confusing and challenging,” says John Frank, vice president and general manager of Respironics' home respiratory business. “We certainly don't have a crystal ball, but if providers are not involved with the American Association for Homecare and other groups that are trying to address this through a lobbying effort, that's discouraging.”

Frank adds that CMS' oxygen policy and reimbursement overhaul has sent a very strong message that the value of the service element of oxygen delivery is not appreciated or important. “That should be a concern for everybody from the patients to the providers to the manufacturers,” he says.

One of the first points of anxiety facing the industry is whether the cap on oxygen rental could actually be reduced to 13 months.

“Thirteen months is really ridiculous,” says Joe Priest, president and COO of AirSep Corp. “This would literally eviscerate the home care provider industry in home oxygen and the patients would get nothing in service.”