WASHINGTON--The industry dodged a bullet last week as the House and Senate found a way to get rid of next year's scheduled Medicare physician pay cut without cutting into HME to do it.

Legislators had been considering reducing the rental period for home oxygen from 36 to 13 months as a way to replace funding for the 5 percent reduction in physician payments, which was set to take effect in January. But House and Senate leaders came up with a compromise bill on a number of health care, tax and trade issues in a single combination bill, passed Friday by the House as the Tax Relief and Health Care Act of 2006. The Senate was expected to vote on the bill over the weekend before Congress adjourned.

The legislation proposed to avoid the physician cut in part by slashing $7 billion from the Medicare Advantage Stabilization Fund, established under the Medicare Modernization Act to encourage greater participation in Medicare Advantage.

Earlier last week as the 109th Congress was winding down its lame-duck session, stakeholders had geared up to lobby against further reimbursement cuts to oxygen to finance elimination of the pay reduction. The American Association for Homecare and buying group VGM sent out rallying calls alerting members to the potential threat.

But even though there appears to be no more risk at present, AAHomecare warns, the oxygen issue and others affecting home care could come up again when the 110th Congress convenes in January.

There was no action this session on two sets of bills that would have given some protection to the industry. H.R. 3559--known as the Hobson-Tanner bill--and its Senate companion S. 3920 would ease some effects of DME competitive bidding, mandated under the MMA to begin in 2007. The Home Oxygen Patient Protection Act, H.R. 5513-S. 3814, would repeal the Deficit Reduction Act's 36-month oxygen rental cap.

As soon as the session wrapped, according to Mike Reinemer, vice president, communications and policy, the association was set to begin planning how to beat back any further reduction to the home oxygen benefit or other assaults on home care, and would "be looking at issues and priorities for the 110th Congress [to] develop strategies for oxygen, competitive bidding and other issues."