Page 11 - HME Business, January/February 2020

With the Round 2021 announcements alone, this year should be full of headline-making moments (whether or not they receive rave reviews), so let’s get the show on the road and dive into the 2020 Big Ten:
Round 2021 Fee and Contract
Announcements
This year will be the year that Round 2021 of competitive bidding comes into focus. We’ve had the run-up to Round 2021, and providers have already registered and submitted their bids for competitive bidding. The bid window closed, and, at the time of this writing, the Competitive Bidding Implementation Contractor had just released its preliminary bid evaluations and providers have responded to any deficiencies identified by CBIC.
So, what next? This summer, CMS will announce the single payment amounts for Round 2021 and will begin its contracting process. Then in fall, CMS will announce the Round 2021 contract suppliers, and on Jan. 1 2021, we will see the Implementation of Round 2021 contracts and prices.
Now, I know it’s easy to get blasé about competitive bidding, given that the industry has been dealing with this since the first bid of Round One. But let’s not forget what Round 2021 is all about — HME providers will see some significant changes to the program. I feel pretty confident in saying that the two most major ones are:
• It uses lead item pricing, which means the single payment amount (SPA) for the lead item in each product category is based on the maximum or highest amount bid for the item by suppliers in the winning range. The SPAs for all other items in that category are then based on a percentage of that maximum winning lead item bid.
• Round 2021 now covers 16 product catego- ries, including off-the-shelf (OTS) back braces, OTS knee braces, and — most alarmingly — non-invasive ventilators. And when it comes to non-invasive ventilators, at press time, legislative efforts to protect them are still in process.
While Round 2021 doesn’t happen until next year, this year, we will finally get a chance to look under the hood when it comes to lead item pricing and see how it will impact reimburse- ment. Furthermore, hopefully, we will find some legislative fix this year to protect the vulnerable patient groups that depend on non-invasive ventilators.
The Expansion of Six-Year Lookback Audits
In October 2019, the HHS OIG announced it would once again expand its audit workplan to include PAP supplies. What does that mean? More six-year lookback audits.
HMEB readers might recall that HHS OIG
did this before in June 2018. Back then, CMS examined a sample of 110 claims that Medicare paid in 2014 and 2015, and found that only 24 complied with Medicare requirements, while 86 claims with payments totaling $13,414 did not. CMS took those figures and estimated that it had made overpayments of almost $631.3 million at that time.
So, the OIG recommended that CMS to contact the 82 providers that had submitted those 86 claims and identify and return any over- payments per the Affordable Care Act’s 60-day rule. A key part of that rule is that it has a look- back period of six years. That means the provider must review all its claims for that six-year period and pay back any overpaid claims.
That six-year lookback is a massive under- taking. The endeavor requires expert legal and consulting help as well as enlisting special-
ists such as statisticians. At the time, industry audit expert Wayne van Halem, CFE, AHFI, the president of audit consulting firm The van Halem Group LLC (Atlanta, Ga; a business unit of VGM Group), underscored the stakes by noting that if the government decides that a provider didn’t engage in enough due diligence, they could unwittingly run afoul of the False Claims Act (FCA) and those violations can entail significant penalties and can see the government revoke
a provider’s billing privileges or Medicare participation.
Well, now, HHS OIG has once again expanded its audit workplan to include PAP supplies. Furthermore, the UPIC contractors are sending letters that include similar language to the OIG reports, which could portend even more audits. Providers must work to understanding the true impact of a six-year lookback, and how they can prepare their businesses and work with the right experts to mitigate this audit trend for 2020.
The Need for Diversified Payer Relations
Many providers still derive a significant portion of their revenues from funding sources. During 2019, it finally became clear to providers that they must diversify their revenue sources beyond the Medicare-plus-some-retail approach that has become prevalent in the industry, and really start specializing in managing relations with multiple
payers and revenue sources. They must learn how to work with a mix of Medicare/Medicaid managed care organizations, private payer insur- ance carriers, facilities-based care providers such as skilled nursing facilities, and health plans.
This is especially true now that managed care is playing a much larger role in the industry than before. This is ushering in even more private payer players that providers must learn to
work with. Considering that working with every funding source can feel like learning a whole new ballgame, providers will have their work cut out for them.
They must learn how to better negotiate with those various payers; they will need to learn how to interact with patients and referral partners more effectively; they will need to learn new business management techniques; and they will need to learn more about the resources that will be around to help them do this.
Industry resources such as the American Association for Homecare have been working
to help providers tackle this challenge. With
the addition of Laura Williard to head up the association’s payer relations back in 2016, it was clear that managing various payer relations was a challenge AAHomecare knew providers would have to address. More recently, the association formed its Payer Relations Council to focus on non-Medicare payer relations, such as Medicare Advantage, Medicaid, Medicaid Managed
Care Organizations and commercial plans. That council recently held its first meeting.
Providers will have to tap into resources such as these as the sources of funded revenue become a wider spectrum during 2020 and beyond.
Medicare and Medicaid Managed Care
When it comes to dealing with diversified payers, one trend that sort of snuck up on the HME industry is the growth of Medicare Advantage plans and Medicaid Managed Care plans.
Managed Care is quickly becoming part
of everyday business for HME providers. Approximately 35 percent of Medicare benefi- ciaries are signed up with Medicare Advantage Plans, while roughly 70 percent of Medicaid beneficiaries are signed up with Medicaid Managed Care Plans. Moreover, these percent-
When it comes to payer relations, various factors are ushering
in even more private payer players with whom providers must learn to work. Considering that working with every funding source can feel like learning a whole new ballgame, HME providers have their work cut out for them.
Management Solutions | Technology | Products hme-business.com | January/February 2020 | HMEBusiness 11