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Home Health & Hospice Week

Industry Notes:

Lawmakers Could Target Home Care For Cuts

Published on Wed Jul 30, 2003

It just may have become more difficult to get negative home care provisions out of - and good home care provisions into - the pending legislation for a Medicare prescription drug bill and other Medicare changes.

The Congressional Budget Office says both the House and Senate-passed bills are over the $400 billion, 10-year limit set by President Bush and approved by Congress in the fiscal year 2004 budget. And they're over by tens of billions of dollars.

The shortfall may mean legislators will look for cuts to support drug benefit provisions, and home care makes an appealing target.

Home health agencies are fighting to get copayments and reductions to payment updates out of the bill while making sure that an add-on for rural home health services and homebound demonstration projects stay in. Durable medical equipment suppliers want to avoid national competitive bidding for a number of items.

It now appears that the committee working to reconcile the House and Senate Medicare bills won't reach agreement on provider-specific provisions until after the August recess, when it also will tackle the prescription drug specifics. Agreement on certain regulatory provisions might occur before the end of the month, however, observers say.

  • Medicare beneficiaries aren't limited to the blood glucose testing strip parameters the Centers for Medicare & Medicaid Services set in a 2002 program memorandum, but suppliers should expect to have to furnish documentation justifying the need for additional strips above that limit, CMS said in the June 25 special Open Door Forum for DME.

    In most cases, 100 strips in a three-month period for non-insulin treated beneficiaries, and 100 strips in one month for insulin-treated benes is reasonable and necessary, a CMS official said.

    But some patients need to test more often, and Medicare will pay for supplies when they do, CMS promised. However, suppliers shouldn't be surprised if the DME regional carriers ask them to show justification for the increased testing need.

  • Software vendors and HHAs that write their own OASIS software can call into an Aug. 20 teleconference put on by CMS. It aims to help vendors and agencies better understand the requirements and specifications for the new version of OASIS that takes effect in October. The technical teleconference, which will go over OASIS Version 1.40, will be from 1 p.m. to 2:30 p.m. ET. More information is at www.cms.hhs.gov/oasis/82003svt.pdf.

  • HHAs shouldn't hold their breath waiting for the new conditions of participation. The home health COPs, which have been repeatedly delayed for years, are now slated for "early 2004," a CMS source said in the July 3 Home Health Open Door Forum. The last due date from CMS had been December 2003.

  • CMS is adding and revising some HCPCS codes in the next quarterly DME coding update, which will take effect Oct. 1. The fee schedule amount for L0462 (thoracic-lumbar-sacral-orthosis [TLSO]) was based on incorrect information, so the DMERCs must revise it for October, CMS says in July 18 program memorandum AB-03-100.

    K0622 through K0626, new codes for bandages, will be added. And the new codes for covered compression stockings, L8110 and L8120, will go on the list, CMS says (see Eli's HCW, Vol. XII, No. 23, p. 183).

    Finally, three new codes for infusion drugs also will go into effect Oct. 1, CMS says in a separate July 18 memo, B-03-052. Q4075 (Injection, Acyclovir, 5mg), Q4076 (Injection, Dopamine Hydrochloride, 40mg) and Q4077 (Injection, Treprostinil, 1mg) are used in infusion pumps.

  • Health care financier DVI Inc. has resolved some of its accounting problems, but the Jamison, PA-based lender still isn't on bond-raters' good list. U.S. Bank rescinded a notice of default on a DVI bond issue and another bank, HCSB Bank USA, stepped in as trustee. And DVI hired BDO Seidman as its independent auditor.

    But DVI still hasn't cleared up the problems that caused auditor Deloitte & Touche to resign in the first place and DVI to miss a Securities and Exchange Commission filing (see Eli's HCW, Vol. XII, No. 25, p. 199). That leaves DVI's health care clients wondering if they can count on future financing, or if the company will go the way of bankrupt National Century Financial Enterprises. Standard & Poor's has left DVI on its watch list for downgrades, reports the Philadelphia Inquirer.

  • Meanwhile, Costa Mesa, CA-based investment firm Westar Capital has bought a California respiratory, infusion and HME company that was driven into bankruptcy by National Century Financial Enterprises' collapse. Westar bid $2.5 million upfront and posted a $500,000 note payable over 12 months to buy San Diego-based Life-Care Solutions West Inc., reports The San Diego Union-Tribune.

    LifeCare filed Chapter 11 last November and reported $30 million in annual revenues last year. Tom Robbins, former executive vice president of Apria Healthcare, now helms LifeCare as CEO. Jeremy M. Jones, former Apria chairman and CEO, invested $1 million in LifeCare and now will serve as its chairman, the paper says.

    The purchase will leave 350 employees in place in Washington, Arizona and California.

  • There's good news and bad news for Matria Healthcare Inc. this week. The good news: Four unnamed self-employers that the Marietta, GA-based disease management company assures are "large" have chosen Matria to furnish DM.

    The bad news: Atlanta-based law firm Chit-wood & Harley has filed a class action securities lawsuit on behalf of Matria shareholders against the company and its officers. It is filed in the U.S. District Court for the Northern District of Georgia.

    The suit alleges Matria made false and misleading statements in parts of 2001 and 2002 to cover up the company's financial problems.

  • Norcross, GA-based Pediatric Services of America Inc. has opened two new branches to furnish HME to children in San Antonio, TX and Chesapeake, VA, PSAI says. The new branches will complement existing PSAI home nursing operations in the area, says the company with 120 branches in 22 states.

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