Page 20 - HME Business, January/February 2022

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for review. That marked the final, necessary stage in the regulatory review and approval process.
Fast forward to December 2021 and, after a long wait, the industry finally got its final DME payment rule — just in time for the Holiday season. Here’s what the final rule offered:
• It continued the originally proposed 50/50
blended rate for rural HME suppliers.
• CMS didn’t finalize the HCPCS coding recommendation limiting manufacturers
to only two submissions.
• CMS didn’t finalize the CGM coding and
payment recommendations.
The industry also secured a win with
accessories for manual complex rehab wheelchair accessories, but in a separate final rule that was released in July 2021, in which CMS said it would no longer apply competitive bidding-derived reimburse- ment rates to those accessories.
However, CMS’s final payment rule did not include the two main reimbursement items that the industry sought:
• Extend the 75/25 blended rate for non-
rural areas beyond the end of the PHE.
• It did not base rates in former CBAs on a
90/10 blended payment formula.
IGNORING THE CORE PROBLEM
Not getting those two items means the final rule didn’t truly address the heart of the problem when it comes to DME reim- bursement: rates are based on what amounts to ancient history as far as the healthcare marketplace is concerned.
“We obviously wanted to address the rates that were in the formally bid product cate- gories,” Ryan says. “Those were from a six- year-old competitive bidding program that used a completely different bidding meth- odology. Then we put the new guardrails
in place and rebid it, and the industry bid smart. Well, when we did all that — pre- pandemic — the rates came back and didn’t show significant savings.
In fact, the market reality during the bidding of 2019 showed increases in many categories, yet CMS continued basing its reimbursement on dated rates that were completely disconnected from the market realities and massive costs of today’s Covid- constrained healthcare market.
“CMS responded that it believed that it took care of [providers costs] with its CPI increase and it does not see any issues with access to care or any change in assignment rate,” Ryan explains. “So, therefore, they do not see a problem. However, monitoring the state of the industry, the supply chain crisis, the continual barrage of surcharges, increased costs of goods, and just increased costs to serve patients from an operational standpoint during the pandemic, the situa- tion is very challenging for providers.”
HEADING TO CAPITOL HILL
If anything, CMS not addressing the heart of the problem lets the industry and its legislative allies know where they stand.
“The Hill was waiting to see where CMS was on some of these requests,” Ryan explains. “And now we know that we have no choice but to go through Capitol Hill for adjustments.”
And those adjustments use a familiar method: a blended rate between the adjusted and the unadjusted fee schedule.
“And what seemed to make the most sense to us, when we did the math, was a 90/10 blended rate,” Ryan explains. “So that 90/10 blended rate is going to give us an average adjustment — depending on the CBA and the product category — of around
11 percent up to actually 20 percent to some product categories. It really depends on the product category and the CBA, but using that formula, you take a product category like oxygen, you can see rate increases on the average of about 15 percent. We believe that is more in line with where we need to be.”
To that end, Jay Witter, senior vice presi- dent of public policy for AAHomecare, and Cara Bachenheimer, lobbyist and govern- ment affairs for Health Care Group of Brown & Fortunato, worked with Reps. Markwayne Mullin (R-Okla.) and Paul Tonko (D-N.Y.) to draft legislative language that would apply the 90/10 blended Medicare reimbursement rate for items in the 13 product categories whose bid results were not implemented in Round 2021. These increased rates would apply from Jan. 1, 2022 to Dec. 31, 2023.
In tandem with this effort, Ryan said AAHomecare has already had discus- sions with its Senate champions as well as the Senate Finance Committee and Sen. John Thune (R-N.D.) concerning the need to develop legislative language that would keep some of the 75/25 relief rates for non-rural areas from the CARES Act in place beyond the end of the public health emergency, since the challenges impacting providers are not going to go away.
The 75/25 reimbursement would represent a significant reimbursement gain for non- rural providers. CMS did an estimate that was published by non-partisan analysis group Medicare Payment Advisory Commission (MedPAC), and the analysis showed that the 75/25 blend represented a 33 percent reim- bursement increase. For comparison, the 50/50 blend represented a 66 percent increase.
“As we get the 90-day extensions to the public health emergency, we continue to advocate for our needs when it is coming to an end,” he says. “And we’ll more than likely get a notice when it is going to end. And we believe that the PHE will likely go to the end of the year. But when it does end, we need to make sure we can get another piece of legislation that would extend it.”
PUBLIC AWARENESS PUSH
When the legislative language is released, the industry needs co-sponsors to sign their names supporting that nascent legislation. To that end, AAHomecare has been busy at work to set the stage for that effort — for several months, in fact.
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“Monitoring the state of the industry, the supply chain crisis, the continual barrage of surcharges, increased costs of goods, and just increased costs to serve patients from an operational standpoint during the pandemic, the situation is very challenging for providers.”
— Tom Ryan, American Association for Homecare