Page 8 - HME Business, June 2017

News / Trends / Analysis
CMS Proceeds with Controversial Rural Rate Plan
Plan defies intent of CURES Act; AAHomecare head Ryan calls it a “slap in the face” for industry and lawmakers.
Last month, CMS implemented a plan that the American Association for Homecare had previously labeled “disappointing” in order to readjust reimbursement for claims on DME filed by rural and non-bid area providers for items provi- sioned between July 1, 2016 and Dec. 31, 2016.
CMS originally announced the plan in February, and it immediately drew concern, because it looked like CMS intended to recalculate the rates in a way that did not adhere to the CURES Act, and would not give providers their full reimbursement. CMS’s recent announcement makes it clear that it will not follow the intent of the CURES Act’s rural relief provisions, which became law last December.
Instead of calculating the 50/50, blended fee schedule for rural and non-bid area providers’ claims on the Jan. 1, 2016 fee schedule, CMS is using the lower July 1, 2016 fee schedule, which will result in considerably lower reimbursement for those claims.
To illustrate how much lower, AAHomecare calculated how reimbursement for E1390 (oxygen) in various regions would vary between the January 2016 (50/50 blend with Round Two information) reimbursement; the newly updated July 2016 regional rates (50/50 blend using the Round Two
re-compete bids), and the original July 2016 rate in Figure 1.
“CMS’s decision to
recalculate these rates
based on the July 1 fee
schedule instead of the
rates in effect on Jan. 1 is
a slap in the face to both
the home medical
equipment community,
as well as to members of
Congress who worked
hard to include relief for
our industry into the
CURES bill,” said
AAHomecare President
and CEO Tom Ryan.
“Individuals on Capitol Hill we’ve spoken with are perplexed that CMS has defied clear Congressional intent to essentially extend the Jan. 1 rates for the second half of 2016.
“While we’re disappointed with this outcome, we’re more determined than ever to advocate for better reimbursement policy for home medical equipment providers,” he
continued. “This development lends additional urgency to our industry’s efforts to provide longer term relief for rural and non-bid providers, and I expect these rates will help spur the HME community into heartfelt advo- cacy on this issue.”
AAHomecare Digs Deeper
After releasing the sample numbers in Figure 1 that show the negative impact that CMS’s newly implemented rate plan would have on E1390 claims in rural and non-bid area providers and patients, AAHomecare performed additional number crunching to further illustrate the
plan’s damage.
In its research, AAHomecare compared the
blended reimbursement for the top 25 HCPCS codes based on the July 1, 2016 fee schedule
and the Jan. 1, 2016, and showed the difference between the two. The association then broke those calculations out for each geographic region.
The analysis is available for download as region-specific Excel spreadsheets here: https://www.aahomecare.org/pages/ reimbursement-adjustments-for-rural-non-bid- providers-july-dec-2016. n
“A slap in the face” of the HME community and the lawmakers who passed the CURES Act is how American Association for Homecare President and CEO Tom Ryan described CMS’s decision to move forward with its rate plan.
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Fig. 1: How CMS’s Rural/Non-Bid Reimbursement for E1390 Varies From Jan. 2016 Rates
Region
January 2016
Original July 2016
Updated July 2016
% Difference From Original July Rates
% Difference
Far West
$135.65
$74.40
$123.58
66.1%
-8.9%
Great Lakes
$135.41
$78.61
$125.82
60.1%
-7.1%
Mideast
$135.14
$75.75
$124.57
64.4%
-7.8%
New England
$140.56
$77.72
$125.30
61.2%
-10.9%
Plains
$137.56
$81.46
$127.01
55.9%
-7.7%
Rocky Mountain
$135.81
$78.97
$125.73
59.2%
-7.4%
Southeast
$137.50
$80.56
$126.67
57.2%
-7.9%
Southwest
$137.33
$78.75
$125.88
59.8%
-8.3%
Source: American Association for Homecare
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