Reduce Oxygen Cap to 13 Months, OIG Repeats
WASHINGTON — Most oxygen providers are still trying to cope with effects of the 36-month rental cap, which took effect in 2009. But according to an OIG report released yesterday, CMS should work with Congress to further reduce the rental period for oxygen.
In its Compendium of Unimplemented Recommendations, an annual report to Congress that summarizes cost-saving recommendations for Medicare and Medicaid that haven't been implemented, the OIG reminded lawmakers of its ongoing recommendation based on data from a 2006 report. If Medicare rental payments for oxygen concentrators were limited to 13 months, the report said, the program and its beneficiaries would save about $3.2 billion over a period of five years.
The industry strongly disputed the 2006 report. (For more, see "AAHomecare Details Flaws in OIG Oxygen Report," October 2006.)
Nevertheless, the OIG said in its March 16 compendium, "We continue to encourage CMS to work with Congress to reduce the rental period for oxygen equipment."
The recommendation follows a Feb. 14 Government Accountability Office report that found "Medicare's payment for home oxygen overcompensates suppliers for providing stationary oxygen concentrators." As a result of its findings, the GAO also said Congress should consider reducing home oxygen payment rates.
In its FY2011 report, the OIG said CMS concurred with its recommendation but noted that reducing the rental period for from 36 to 13 months "requires a statutory change. Although bills have been introduced in the past, none has passed."
The recommendation even made the report's seven-item "priority list" for Medicare Parts A and B, which the OIG believes represent the most significant opportunities to impact HHS programs. Three others on that list also involve DME:
- Ensuring DME suppliers' compliance with Medicare enrollment standards;
- Eliminating Medicare's vulnerability to fraudulent or excessive inhalation drug claims; and
- Ensuring that Medicare power wheelchair suppliers meet documentation requirements.
Overall, the OIG said in its report, Medicare and Medicaid could have saved $8.7 billion in FY2011 if all of its recommendations had been implemented.
View the entire compendium. The section on DME begins on page 43.