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Home Health & Hospice Week

Industry Notes:

CMS Paves Way For Supplies Charge Reporting

Published on Thu Jan 15, 2004

Make sure your costs are fully represented.

The Centers for Medicare & Medicaid Services is living up to its word on supplies costs, and that could mean more accurate cost data for home health agencies.

Industry experts have worried HHAs' costs would be understated due to a billing glitch that required agencies to strip supplies costs from their Medicare claims. But CMS pledged last month to allow agencies to report the missing supplies costs on their cost reports, rather than making them individually adjust all affected claims (see Eli's HCW, Vol. XII, No. 45, p. 357).

In a Jan. 2 One-Time Notice (Trans. No. 37), CMS instructs regional home health intermediaries to allow agencies to report the costs accordingly, and not to adjust the supplies cost data down to the figure on the agency's PS&R reports.

"Supply charges do not directly affect HH PPS claim payment, but are valuable for use in future research to support HH PPS payment refinements," CMS says in the instruction.

Agencies served by RHHI Associated Hospital Service of Maine are exempt, since the RHHI was using a different payment system than the one that contained the glitch, CMS says at http://cms.hhs.gov/manuals/pm_trans/R37OTN.pdf.

  • Medicare spending for freestanding HHAs grew 7.2 percent from 2001 to 2002, CMS says. The second year of the "rebound in Medicare spending" was due in part to a change in the definition of "homebound" for eligibility purposes, making more beneficiaries qualify for Medicare home care coverage, CMS maintains in a release.

  • You can throw that approval for your cost report methodology out the window - apparently it's worth less than the paper it's printed on. So concluded CMS in reversing a Provider Reimbursement Review Board decision that said once an intermediary has approved a cost report methodology, it can not be reversed until the intermediary informs the provider of the change.

    "The Administrator does not agree that the methodology ... can be allowed only on the basis that it was approved by the prior intermediary," CMS says in a recently released Administrator's Decision regarding Mercy Home Health in Springfield, PA (see Eli's HCW, Vol. XII, No. 32, p. 254). "This basis for such an allowance ignores the dictates of the Medicare program," CMS insists.

  • A Medicare recipient who retains mobility through the use of a power wheelchair or scooter saves taxpayers more than $5,300 over a three-year period. That's the finding of a new study conducted by RRC Inc. and initiated by The SCOOTER Store.

    "We found that statistically significant savings persisted for at least 12 quarters after obtaining the powered vehicle," said RRC President Dr. Donald House. "The powered vehicle appears to enable qualified individuals to remain mobile longer, which reduces total Medicare claims over this period."

    Researchers analyzed a sample of CMS data from 1994 to 2001 and found the most significant savings were in inpatient expenses related to hospitalization. Other major savings were found in skilled nursing, home care and carrier costs.

  • Medicare will pay for a one-time skilled nursing visit only in rare circumstances, RHHI Cahaba GBA says in its Jan. 1 bulletin to providers. Medicare home care coverage requires that the need for skilled nursing be intermittent, so the program won't pay for a one-time visit for an injection or home assessment, for example.

    It may pay, however, if the need was intermittent at the time of the visit, but then something unexpected happened such as the patient moving out of the service area or dying. Or Medicare will pay if there is also a medically necessary and covered skilled therapy service being furnished to the patient, Cahaba explains at www.iamedicare.com/Provider/newsroom/newslines/010104.pdf.

    When Medicare does pay for a stand-alone visit without therapy, it is as a low utilization payment adjustment (LUPA), Cahaba says.

  • Massachusetts' Division of Health Care Finance and Policy plans to slash its Medicaid reimbursement rates for certain durable medical equipment and supplies including insulin pumps, oxygen equipment, custom wheelchairs and diabetic test strips by as much as 95 percent, reports The Boston Globe.

    The proposed rate cut would save the state an estimated $2.7 billion annually, but has caused an outcry from DME and supplies providers, DME and supplies users and legislators, the paper says. Any new rates are likely to be retroactive to Jan. 1.

  • Walgreens Health Initiatives, through Walgreens Home Care Inc., is building on its Florida presence with a recent acquisition. Deerfield, IL-based Walgreens purchased select assets from the owners of All Care Medical Supply and Interactive Cardio Pulmonary Inc., in Daytona Beach, Okeechobee and Stuart, FL effective Jan. 6, 2004.

    The acquisition of the DME and respiratory firm is part of Walgreens' "ongoing expansion" in the six states with existing WHI operations as well as new states, the company says.

  • Cleveland Clinic Home Care has paid $2.3 million to resolve allegations of cost-shifting in the 1995 and 1996 cost reports of a company it bought, Meridia Home Health, according to a press release from Gregory A. White, U.S. Attorney for the Northern District of Ohio. In addition to shifting costs from non-home health and non-Medicare businesses, Meridia claimed costs for non-reimbursable items such as advertising and travel, White says.

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