Page 8 - HME Business, September/October 2021

Annual Roundtable
over the next several months: CMS’s DMEPOS Payment Rule. Released in November 2020, that proposed rule included
a number of top-level reimbursement items. Notably, it continued current relief for rural HME suppliers via the 50/50 blended rate. Other non-bid area suppliers would be paid at 100 percent of the adjusted fee schedule. It also made changes related to the HCPCS Level II Code Application Process. It also included changes to the process for making Benefit Category Determinations and Payment Determinations for DME and other Items and services under Part B.
The industry “has waited with bated breath to see what
the Biden administration would do with these proposals,” Bachenheimer explains, but two things have delayed progress:
“The first is, when the Biden administration came in January, it put a halt on all regulatory initiatives because they wanted to because they wanted to review everything that was in process during the previous administration,” Bachenheimer says. “The second is the Biden administration took a long time to get its CMS Administrator approved through the Senate.”
For now, it’s a waiting game, she advises: “[CMS] could start from scratch, they could revise it, they could finalize it as it was proposed, and we really don’t have an indication at this point what it will be. ... The rule could be substantially the same or substantially different. We just don’t know.”
3. THE ALJ BACKLOG FIX
The Backlog of audit cases at the Administrative Law Judge level is almost resolved, but audit expert van Halem asks, is that actually good or bad for suppliers?
We certainly know that the previous situation at CMS’s Office of Medicare Hearings and Appeals (OMHA) was almost Kafkaesque.
“A backlog that grew at its
peak to nearly $1 million claims
– a majority of which at one
point (54 percent) were related
to durable medical equipment
claims,” van Halem explains.
Despite the 90 days mandated by federal law, hearings were not occurring for over 1,000 days in many cases. ”
However, OMHA’s implementation of some strategies for attacking the caseload as well as the QIC Telephone discussion pilot as well as the Settlement Conference program resulted in a significant decline in cases pending, he notes.
“Most recent data released by OMHA showed about 85,000 DMEPOS appeals still pending,” van Halem says.
News like that should make providers want to do a jig, but van Halem warns they should hold off on strapping on their dancing shoes.
“The onslaught of the RAC auditors back in 2011 to 2015 is what led to the ALJ backlog,” he explains. “To reduce the
number of claims getting into the Medicare appeal system, CMS began limiting RACs significantly in the volume of claims they can review.
“However, OMHA has opened seven new offices around the country and hired 70 new judges,” van Halem continues. “They now have budget, staffing, and infrastructure to manage over 300,000 appeals annually.”
Currently, the RACs are not receiving anywhere near that volume due to the significant limitation CMS put on them, as well as the decline of audits during the PHE (which is starting to pick back up, van Halem notes).
“Our concern is once the backlog is fully resolved, CMS will loosen their restrictions on the RAC and we will begin seeing an increase in the volume of audits,” he says. “Suppliers should prepare for this. Now is the time to be proactive and look at your claims to avoid long-term issues and having to deal with RAC denials and appeals.”
4. HME’S SUPPLY SIDE
As the delta variant of COVID-19 makes a greater and greater impact on American health- care, post-acute care and HME providers are feeling crunches on the supply side and delivery side of the industry. Ackerman calls it a “perfect storm.”
Delivery times, particularly
at skilled nursing facilities
and hospitals, have sharply
increased. Deliveries of items
like walkers and wheelchairs
that used to take 10 minutes
now take 45 or 60 minutes due
to procedures like clearing screenings and escorted walk-ins, which are not baked into the reimbursement.
“Drivers that could typically do 12 or 13 runs a day are being reduced to four or five,” he says.
Accompanying that, during 2020, the first year of COVID, manufacturers worked to help providers by holding back on price increases and extending terms. However, in 2021 manu- facturers saw their supply costs go up and that in turn has hit providers. Plus, those manufacturers are experiencing supply constraints due to backed-up shipping containers with price tags escalating from $3,000 to $20,000, which has resulted in expanding ship times and costs. This time, vendors are forced to pass on price hikes Ackerman refers to as a “surcharge.”
“In theory, when the problem goes away, they take the surcharge away,” he says. “But I’ve been doing this for 40 years and surcharges are usually blended into price increases. We’re looking at a fairly permanent price increase.”
Lastly, when CMS didn’t bid Round 2021, it acknowledged that it had hit rock bottom with reimbursement.
“Instead of making an adjustment for that, or consulting with the industry, or at least being more transparent, they went
8 HMEBusiness | September/October 2021 | hme-business.com
Management Solutions | Technology | Products
Wayne van Halem,
President and Founder, The van Halem Group LLC
Steve Ackerman,
President, Spectrum Medical