Page 22 - HME Business, January/February 2021

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you can qualify the patient electronically with the doctor signing off on it electronically. A tremendous focus of our teams and our hospital partners is understanding telehealth and the pandemic and how do we keep people away from each other face-to-face while speeding up the delivery of care.
“And the HME heroes are really the liaison and frontline delivery technicians that are literally working days, nights and weekends in the face of a dangerous pandemic and be their first line of defense in getting these concentrators in the hospi- tals and to these patients’ homes,” Parnes says. “And we have nothing but unbelievable gratitude to these drivers — not just for us, but across the industry — that are sacrificing their own safety to make sure that people are able to get their oxygen and get in time so that they could literally save lives.”
At the end of the day, there’s no one-size-fits-all approach to the oxygen’s current supply crunch. Some providers saw the problem coming down the road at the outset of the public health emergency and started amassing supply to meet the anticipated demand. (And even then, they still might be feeling the pinch of overdemand.) Other providers might have had their entire busi- ness models set up on a more just-in-time inventory model and might be scrambling a little.
Furthermore, because there have been up-and-down surges in diagnoses, the demands placed on oxygen providers is inconsis- tent. That inconsistency is only magnified by the varying responses by the different state governments to contain those surges.
OTHER OXYGEN FACTORS
Of course, other factors are influencing the oxygen category besides COVID-19. One of them is competitive bidding. At the end of October, CMS announced that after originally taking bids for 16 product categories in the 130 competitive bid areas of Round 2021 of its competitive bidding program, it was only awarding contracts for the off-the-shelf back and knees braces categories.
That left the oxygen category would remain wide open for new entrants, as it has since the last competitive bidding contracts expired on Dec. 31, 2018. As long as they meet federal and state criteria to support the category, they can support the benefit, which means potentially increased competition. But even then, it might also help with the pandemic, according to AAHomecare’s Ryan.
“For a while, AAHomecare along with other stakeholders have been advocating to put the Round 2021 on hold until this pandemic itself cleared up,” he says. “I think that’s been our push for a long time, particularly for oxygen, hospital beds, and respiratory prod- ucts. To take capacity away, starting in January 2021, and decreasing it by upwards to 35 to 40 percent, which typically happens when you go to the bid cycle and remove all those, any willing providers, was certainly going to be problematic.
“It’s interesting that they also noted they didn’t see the signifi- cant savings, and that’s something we are looking to address as well, but all in all, having more providers out there, being able to serve the patients on this critical pandemic need, is very, very important,” he adds.
The industry could shades of CMS’s intent to table competi- tive bidding in order keep vital oxygen supplies flowing when it removed non-invasive ventilators (NIVs) from competitive bidding.
CMS added the category to the bid program in 2019, which many in the industry labeled “terrifying” given the vulnerable patients that need such care, but by April 2020, it had removed them, acknowl- edging the vital necessity of such devices during the pandemic. The industry’s lobbying was proven right — and just in the nick of time given that Round 2021 was looming.
“What was good about that was, if providers were going to be providing these ventilators, and they knew that competitive bidding was looming, then they were going to be reluctant to buy product, knowing that they might not win the bid,” Ryan explains. “What were they going to do with that inventory? So I think [removing NIVs from Round 2021] freed up everybody to gear up, get the non-invasive ventilators that they needed and be prepared for the pandemic. That was very, very important.”
Another key reimbursement development that should help oxygen providers in 2021 and beyond is the Dec. 21 COVID-19 relief bill, which included provisions that fixed a Medicare reimburse- ment disparity for oxygen items provided in rural areas due to the application of outdated budget neutrality provisions from the 1997 Balanced Budget Act.
Back then, the idea was to essentially take Medicare dollars out of stationary oxygen to encourage the migration of patients to new oxygen technologies, and do so in a budget-neutral manner.
“When CMS began to apply this budget neutrality adjustment to oxygen in non-bid and rural areas, or as we coined the phrase, they ‘doubled dipped’ for oxygen,” Ryan explains. “We saw rural to CBA comparisons averaging 1 percent lower and non-bid, non-rural rates averaging 10 percent lower than competitive bidding rates.
“The example I used in discussions with legislators was Birmingham-Hoover Alabama, where the disparity was 21 percent,” Ryan recalls. “So, a competitive bidding winner in that competi- tive bidding area had a rate of $89 dollars for oxygen concentrator while the non-rural, non-bid supplier seeing no increase in market share got $71 dollars a month. The optics and illogical approach to setting those rates were outrageous.”
The provisions in the most recent COVID-19 relief package to fix that offset as well recent legislative and regulatory actions that apply a 50/50 blended rate to oxygen and other HME products in rural areas and a 75/25 blended rate in non-bid, non-rural area, should give those providers room to breathe a little easier, even during a pandemic.
“That win we had in the last relief package was four years of sustained grassroots advocacy that this industry should be proud to have accomplished,” Ryan says. “This persistent engagement gave us a permanent fix that will put back $650 million into rural providers bottom line over the next 10 years.”
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“I haven’t heard about any particular area of the country being out of oxygen yet, but I think we’re approaching a critical concern.” — Tom Ryan, American Association for Homecare