ATLANTA — CMS got an earful from home medical equipment providers, respiratory therapists, physicians, beneficiaries and a host of other entities that weighed in with comments about the agency's 2009 physician fee schedule final rule, which includes payment policies that apply to reimbursement after the 36-month oxygen cap.
Implemented Jan. 1, provisions in the final rule mandate that providers continue service to Medicare oxygen patients for up to 24 months past the rental cap with no payment. They also require providers to continue service to patients who move out of their service area or who travel.
In public comments ranging from lengthy and detailed to brief, the writers — including the American Association for Homecare and the Council for Quality Respiratory Care — were almost universally unsupportive of the rules surrounding the cap, calling both for their repeal and for reform of the oxygen system. The vast majority of comments, which were due Dec. 29, centered on the costs of service that will not be covered post-cap, access issues for beneficiaries, increased emergency room visits and hospitalizations — and CMS' apparent inability to understand that oxygen is not on par with a walker.
"In order for Medicare to appropriately provide a home oxygen therapy benefit, the program should be completely reformed in a manner that increases provider accountability, recognizes the service component and links reimbursement to patient need," wrote the CQRC, a coalition of oxygen manufacturers and providers. Current policy does not differentiate among beneficiaries based on their needs and activity levels, the CQRC said, and it overlooks the service component entirely.
The group said the new rule "takes an unprecedented step in the history of the Medicare program and indicates that suppliers do not need to be compensated for the services and supplies they provide to beneficiaries."
In its comments, the CQRC asked for a per-month rate to support emergency maintenance and services, and for disposable supplies and nonwarranty parts of not less than $25 a month. "CMS has clear authority to pay for them," the CQRC said.
The American Association of Homecare drove home the point and said there is a "mistaken assumption that Medicare pays too much for equipment without accounting for the support services that are bundled into the monthly fee schedule amount."
AAHomecare also asked for revisions in the final rule, including reimbursing providers for nonroutine services and resetting the payment cap for beneficiaries who relocate outside their provider's area. "The policy is completely unworkable because suppliers may be unable to operate in the beneficiary's new location as a result of licensing or regulatory requirements," AAHomecare said.
On Friday, the association released a detailed proposal for
reform of Medicare's oxygen benefit.
Tom Coogan, director of industry affairs for Care Medical and
Rehabilitation Equipment in Portland, Ore., reminded regulators
the cost of providing oxygen largely lies in the service.
"Only 28 percent of the true costs associated with providing these services are in the acquisition costs of the equipment. The remaining 72 percent of actual costs is associated with delivery, pick up, operations, maintenance, repairs, and customer service," he noted. (For more on a study from Morrison Informatics on which these figures are based, see New Study Documents Cost of Home Oxygen Services, HomeCare Monday, July 10, 2006.)
Coogan added that CMS "constantly" compares industry pricing to online wholesalers "who do not provide comparable services or products. Internet dealers who 'drop ship' product do not include delivery or pick-up, do not meet the mandated 25 quality DME Supplier Standards, do not maintain adequate inventory, generally must sacrifice both quality and safety to reduce pricing, often utilize Internet sales to circumvent state taxation schedules, provide no maintenance or service to the patient and do not bill insurance that can often take 60-120 days for payment.
"This dramatically reduces overhead to lower pricing while ignoring CMS' mandated requirements, and yet CMS continues to apply fallacious reasoning that compares 'apples and horses' rather than 'apples and apples.'"
In addition, Coogan said, "Oxygen equipment is mechanical in nature, and thusly demands occasional repairs and routine services. Much like an automobile, if regular maintenance and service is neglected, oxygen systems will not operate efficiently or correctly. Utilizing this analogy, CMS is forcing home care providers to yield free extended warranties, free replacement parts beyond the initial manufacturer's warranty, free roadside assistance, free in-home maintenance and service with free rentals if necessary, free travel rentals and free payments past 36 months for 24 additional months at deeply discounted prices that are below our actual costs. Needless to say, this policy is shortsighted and punitive to beneficiaries and providers alike ...
"Unfortunately, legitimate providers like Care Medical are now being forced to decide whether patients will get life-sustaining services or not dependent on costs."
Excerpts from a sample of additional comments follow:
— David Petsch, Georgia: "I am certain that this bureaucratic department is in total breach of contract to the government and taxpayers and should be held liable for the damage and injury to occur to any of these Medicare recipients. Under their own accountability, they themselves, years ago, determined that oxygen was a drug that needed to be handled under different life-threatening rules. Instead, now, they themselves are suggesting it be bought and sold as any other commodity on the Internet and the streets. For this they should be held accountable."
— Hal Freehling Jr., Ohio: "The rule imposes new obligations on suppliers that, under any measure, exceed what the Medicare program demands from any other provider. Among the extraordinary new obligations facing suppliers are requirements to provide emergency services and disposable supplies without compensation for as long as 24 months after Medicare payments cap and a requirement to continue serving beneficiaries who move or travel outside the supplier's service area ... Under the new rule it will also be next to impossible to continue to support and service patients that travel outside a supplier's service area. Oxygen is not a long-distance service."
— Sandra McCune, Michigan: "As a hospital [registered nurse] care manager, I see many potential problems with these new rules regarding discharge planning and access to oxygen for patients. We will be caught in the middle of patients who have the right to choose any DME provider, and DME providers who won't accept patients who are well into or past their 36 months. There will be delays in discharge, confused and upset patients, and we will have to waste time on this that could be much better spent. If the discharge plan is for the patient to move to a different area, it would be an even bigger nightmare.
"How is the DME provider supposed to find a new supplier for the patient when that supplier will not be paid? For that matter, how are DME providers expected to provide free services and supplies for possibly decades for these patients? I urge you to rescind this ill-conceived regulation."
— Beth Blair, Kentucky: "Not only will Medicare patients be the ones to suffer from less service due to companies not being able to stay in business due to the cap, it is unreasonable for CMS to think a company can continue to do business for a patient for five years when you only get paid for three!"
— Daniel Shields, Pennsylvania: "I am afraid that removing the ongoing rental revenue stream will place many companies in the position of having to not accept Medicare patients or decrease the services we currently provide to them. This would effectively 'chain' a patient to their concentrator or induce a patient to go without their portable oxygen. This would result in increased emergency room visits and hospitalizations. One day in the hospital is more expensive than one year of home oxygen."
— Kathy Brewer, Florida: "Oxygen is life support, not a capital asset like a wheelchair. A cap on this service is morally reprehensible."
— Jeff Meischen, Texas: "CMS is requiring all suppliers to be accredited in 2009. Accrediting bodies require that suppliers define their service areas and not accept or continue to service patients that do not live within those areas. In some instances, this [rule] is requiring a DME supplier to break the law. This in itself is a violation of supplier standard No. 1, which requires that suppliers adhere to all local, state and federal laws and accrediting body standards. If a patient resides in one state and moves across the country to another state, that supplier would have to be licensed in that state to provide the patient with oxygen. Since the rule only allows that the provider that was paid the 36th month can bill for portable contents, this responsibility cannot be transferred to another provider. The billing provider would have to be licensed in the state that the client now lives. However, most states will not issue a license to a company that does not have a physical site in that state. Therefore, no license can be obtained. The supplier is clearly between a rock and a hard place. Regardless of what the supplier does, they would be violating a law."
— Tammy Horsnby, Texas: "Although the DME companies will abide by the policy and offer the patients what is needed, the 'extra' services that enhance the care the patients currently receive will dissolve ... The changes will stop all of the [extra] services, as well as put some DME companies in jeopardy. In today's economy, the last thing we need is more lost jobs, but that is what will happen if this policy goes into effect. We have already heard locally of many companies shutting their doors because they can no longer afford to operate with the cap and cut.
"Until CMS has a firm understanding of how DME companies work and what our services involve, CMS will never understand how important the repeal of this policy is. It is vital to providers, as well as patients, that this cap is deleted. The repeal will not only protect patient health, but also protect jobs and families."
As of Friday, a tally of the comments that had been received was not available from CMS, and the agency was still adding comments to its posting.
To view comments on the rule, click here, then click docket CMS-2008-0073.
