WASHINGTON—Last week’s Office of Inspector General
report on Medicare power wheelchair payments “substantially
left out the services involved in providing these products and the
related costs incurred,” the National Coalition for Assistive
and Rehab Technology responded.
Released Sept. 2, the OIG
report maintained Medicare reimbursed almost four times
the amount providers paid for standard power wheelchairs in 2007,
and twice as much for complex rehab PWC packages as providers paid
to buy them.
NCART was “encouraged that the OIG somewhat recognized the
service component in the provision of ‘complex rehab’
power wheelchairs, ” said Gary Gilberti, president and CEO of
Chesapeake Rehab Equipment, Baltimore, and the coalition’s
president, “but we are concerned that they did not reflect
all of the costs that are incurred over and above the acquisition
cost of the product. ”
Those costs are significant, according to an NCART statement:
“A 2008 industry study indicated on average a company’s
non-product costs were almost equal to the acquisition costs of the
products. These non-product costs were expended in the following
areas: intake, qualification, and documentation (14%); evaluation,
specification, and fitting (23%); purchasing, receiving, assembly
and delivery (13%); billing and collection (12%); service and
repair (11%); sales and marketing (10%); regulatory and compliance
(4%); and administration and support (13%).
“In light of all these costs, complex rehab companies
reported business profits averaging less than 5%. This reported
profit level was for 2007 and does not reflect the impact of the
9.5% reimbursement cut in 2009.”
As a consequence of the 9.5 percent cut and a previous
reimbursement reduction in 2006, a number of companies in the
segment have exited the business, NCART said, leaving Medicare
recipients and others in the “precarious position” of
losing access to qualified providers.
In a list of points accompanying its statement, NCART said analyses
have shown there are more than 30 primary activities involved in
the provision of complex rehab PWCs, including evaluating,
obtaining coverage, delivery, training and follow-up, with some of
the functions occurring multiple times depending on people’s
disabilities and their positioning and functional needs.
“These products are not ordered out of a catalog and dropped
on someone’s doorstep,” Gilberti said. “In
addition, they require significant after-the-sale service and
support.”
NCART, along with AAHomecare, NRRTS and RESNA, is currently
studying the creation of a
separate complex rehab benefit
and has contracted with Washington, D.C.-based consulting firm
Avalere Health to figure out which route—regulatory,
legislative or a combination—would be best to push such a
proposal forward.
“There is no doubt that, taken at face value, the OIG report
creates additional PR challenges for us within CMS and on Capitol
Hill,” said Gilberti. “It will be critical that we
provide the appropriate data that can illustrate the additional
costs that the OIG did not recognize.
“This report does increase the amount of education and
re-education we must do about the complext rehab industry in order
to be successful in our efforts for a new benefit category.
Nevertheless, I personally feel that it also presents a good
argument for the need of the new category and the need for us to
further separate ourselves from low-end power
providers.”
Avalere’s report is due this month, and
NCART
Executive Director Don Clayback will detail the
results in a session at Medtrade in October.
“We need to gain support for the complex rehab
message,” said Clayback. “This OIG report is another
hole in the complex rehab boat.”
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