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Home Health & Hospice Week

Industry Notes:

OIG PAINTS HME INDUSTRY AS OVERPAID BY MEDICARE

Published on Tue Mar 24, 2009

Watchdog agency urges lawmakers to shorten oxygen cap to 13 months.

Senators recently got an earful about excessive payments in the home medical equipment industry, and that's not helping suppliers' efforts to win legislative help with competitive bidding and the oxygen cap.

In the Senate Finance Committee's round-table discussion on health care finance reform April 21, the HHS Office of Inspector General highlighted recent findings alleging that Medicare overpays suppliers. "Health care programs should have mechanisms to ensure that payments remain reasonable and reflect market conditions," OIG General Chief Counsel Lewis Morris told the committee in prepared testimony.

Problem #1: Medicare pays suppliers more than $17,000 for negative pressure wound therapy pumps, but suppliers themselves pay only an average of $3,600 for the items, the OIG maintains (see Eli's HCW, Vol. XVIII, No. 12, p. 95). Market forces have driven the prices down since Medicare set the payment rate for the pumps in 2001.

Problem #2: Oxygen suppliers that hate the 36-month oxygen rental cap may have even worse in store if the OIG gets its way. Medicare pays on average more than $7,000 for oxygen concentrator rentals when the items cost suppliers about $600 to purchase. This shows that lawmakers should shorten the oxygen cap to 13 months, the OIG insists.

"If home oxygen payments were limited to 13 months rather than the current 36 months, Medicare and its beneficiaries would save $3.2 billion over five years," Morris told the senators."Because Medicare's reimbursement methodologies do not respond promptly to changes in the marketplace,Medicare and beneficiaries are paying too much."

• The Medicare program hasn't yet designated publicly reported quality measures for hospices,but one state's hospice providers are stepping up to the plate voluntarily with their own data.

Hospices in Florida will publicly report measures on the state's www.http://floridahealthfinder.govWebsite based on five questions from the Family Evaluation of Hospice Care (FEHC) survey. The survey is distributed by the National Hospice and Palliative Care Organization.

"Florida consumers now will have access to in-depth information to help them compare and evaluate multiple factors when making decisions about selecting a hospice provider for end-of-life care,"says trade group Florida Hospices and Pal-liative Care.

Not everybody: Not all hospices in the state are participating in the outcomes reporting, however.Hospices that don't provide data are listed with an "N/A" on the Web site. A footnote explains that such hospices don't use the FEHC survey.

FHPC worked with the state's Agency for Healthcare Administration to institute the program,the group says in a release. The five outcomes are "Patient's personal needs taken care of; Patient treated with respect; Family kept informed of patient's condition; Care patient received while under care of hospice; and Hospice team response to your evening/weekend needs." The site shows results in a five-star format.

"We applaud Florida's hospices for being proactive in providing information on consumer satisfaction and quality," says AHCA's Holly Benson in the release.

"We are very pleased that Florida is the first state organization to use the survey to augment the amount of information Florida consumers have access to," adds NHPCO's J. Donald Schumacher.

"As providers we must be accountable for delivering the results that patients, families, and those who regulate and pay for hospice care expect,"says Anthony Palumbo of Hospice of Citrus County and Hospice of the Nature Coast.

• Buckle up for a potentially bumpy ride when Medicare Administrative Contractor National Health Insurance Corp. takes over from regional home health intermediary National Government Services on May 15.

But your transition will be smoother if you keep an eye out for an important "Cutover Communication"that will arrive in your mailbox soon. It will contain important contact information and instructions for your transition such as telephone inquiry CSR, IVR, and TTY numbers; an electronic claims submission timetable and Help Desk number; and mailing addresses for appeals, correspondence, and enrollment forms, NHIC says in a message to providers.

NHIC is the first MAC to take over from an RHHI. The other two new HH MACs, Highmark Medicare Services and Noridian Administrative Services, haven't yet set their transition schedule, a Centers for Medicare & Medicaid Services official said in an industry conference last month. The Government Accountability Office will make decisions on contract protests for those jurisdictions by early May and the transitions will proceed from there, the staffer said.

Highmark will take over agencies currently served by Cahaba GBA while Noridian will take over NGS/United Government Services' workload. Palmetto GBA will continue as the HH MAC in its jurisdiction.

• Large suppliers of HME have a little extra time to get new locations in compliance with Medicare's surety bond requirement that takes effect next month.

"HME providers with 25 locations or more will be required to submit one surety bond per practice location by Oct. 2 with pending applications for new locations," the American Association for Homecare clarifies in a message to members. "This information is different from what was stated during an earlier CMS Open Door Forum on surety bonds -- May 4 was previously given as the deadline."

New DME companies that aren't new locations of existing suppliers are still subject to the May 4 deadline to acquire a bond.

• If you've got questions about new enrollment procedures under the Internet-based Provider Enrollment, Chain and Ownership System (PECOS), you may want to dial into a free CMS Special Open Door Forum on the new system. CMS will present information and answer audience questions in an April 30 forum. More information is at www.cms.hhs.gov/OpenDoorForums/05_ODF_SpecialODF.asp.

CMS contends that using PECOS will cut enrollment paperwork time in half, but HME suppliers are not eligible for the system yet.

• When you request a redetermination from RHHI Palmetto GBA, be sure to use the updated form.

"This form is interactive," Palmetto explains in a message to providers. "It can be completed online, printed, and then mailed which means no more filling the form out by hand!"

Tip: "When completing this form, please remember to submit each redetermination request separately," Palmetto says. And "please avoid stapling multiple redetermination requests together."

For a free PDF file and link to the new form, e-mail editor Rebecca Johnson at rebeccaj@eliresearch.com with "Palmetto Redetermination Form" in the subject line.

• The nominee for Department of Health and Human Services Secretary, former Kansas Gov. Kathleen Sebelius, is one step closer to confirmation. The Senate Finance Committee approved her nomination with a 15-8 vote. The full Senate will vote next, AAHomecare points out.

"Gov. Sebelius knows that every time the Congress cuts the Medicare home health benefits it results in higher costs to the states in form of greater utilization of their Medicaid programs," the National Association for Home Care & Hospice says in its member newsletter. "When Washington sneezes, it is the states that catch the cold."

Observers hope to see a permanent CMS head appointed shortly after Sebelius' confirmation.

• If you've been thinking about furnishing medical nutrition therapy (MNT) services for diabetic patients, you may want to tune into an educationalsession from RHHI NGS.

NGS will discuss coverage, coding, payment,and cost-sharing of MNT in a May 5 educational teleconference. More information is at www.NGSMedicare.com.

"For people with diabetes or renal diseases, proper diet and nutrition can help prevent and reduce complications from their conditions," the RHHI notes. "Medicare covers medical nutrition therapy services for people with diabetes or renal diseases to help them manage their conditions."

• Hospices accredited by the Joint Commission can rest easy that they won't have to switch surveyors anytime soon. CMS has renewed the Commission's accrediting deemed status authority for hospices, the Oakbrook Terrace, Ill.-based organization notes in a release.

The Commission, formerly known as JCAHO, has run a home care accreditation program since 1988 and been deemed for hospice surveys since 1998, it notes. The organization accredits more than 4,000 home care providers of different types.

• Dwindling Medicare reimbursement is closing the doors of a North Carolina home health agency. Chowan Hospital Home Care in Edenton will cease operations by Sept. 30, reports The Chowan Herald. The closure will affect the agency's 80 workers, many of whom are aides.

Chowan is owned by Greenville, N.C.-based University Health Systems and has operated since 1991, the newspaper says. The HHA's patients will transition to other agencies in the area.

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