Moving the HME Industry Forward

Legislative/Advocacy

AAHomecare in Action – Supporting Complex Rehab Users on Capitol Hill

June 15, 2015

WASHINGTON, DC – Several AAHomecare staff members participated in last week’s Roll on Capitol Hill, United Spinal Association’s annual legislative advocacy event that addresses issues that impact the health, independence and quality of life of individuals living with spinal cord injuries and disorders.

This year’s event brought more than 80 consumer advocates to Washington to meet with their congressional representatives to advocate for access to complex rehab technology, transportation, and preventing the application of competitive bid rates to complex rehab accessories.

The Save My Medical Supplies campaign exhibited at the conference, and members of our legislative team joined in meetings with consumer advocate Gary Whitman, including ones with Reps David Cicilline (D-RI), Jim Langevin (D-RI), Sam Farr (D-Calif), Loretta Sanchez (D-Calif), Ken Calvert (R-Calif), Alan Lowenthal (D-Calif), and Peter DeFazio (D-Ore), as well as Sens Orrin Hatch (R-Utah) and Sheldon Whitehouse (D-RI).

AAHomecare’s Complex Rehab & Mobility Council is helping to spearhead industry efforts for current legislation supporting this community, including the Ensuring Access to Quality Complex Rehabilitation Technology Act of 2015 (H.R. 1516) and its Senate counterpart (S. 1013), as well as supporting the exemption of complex rehab accessories from competitive bidding pricing.

AAHomecare Comments on GAO Study
WASHINGTON, DC – The GAO released a study on whether CMS should consider alternative approaches to audit contractor performance. See our summary of the study and the full study for additional details. Additionally, Kim Brummett, AAHomecare’s vice president of regulatory affairs, offers further perspectives on the study, as follows.

The study points out that the DME MACs reported spending a higher portion on appeals than the other A/B MACs—an interesting fact given the challenges many suppliers are having with pre-pay audits from DME MACs. Costs to the MACS average 18 percent of all expenditures, $31.8 million dollars; it would be interesting to know what the overturn rate on appeals is that would compound this overall expense.

The study further explains that CMS meets annually with MACs to discuss opportunities to be innovative and make improvements. AAHomecare asserts that it would be helpful for industry representatives to have an opportunity to provide input into MAC processes and opportunities for efficiency.

An innovative idea cited in the study was from one of the DME MACs that implemented participation of MAC representatives at Office of Medicare Hearing & Appeals (OMHA) Administrative Law Judge hearings.  The report concludes that more of the initial MAC decisions were upheld when this occurs; neither OMHA nor the DME MACs publish any data to this effect.

One of the topics included and often discussed in legislative discussions is the opportunity to extend contract terms beyond 5 years. There appears to be much interest in the concept that a longer contract would allow CMS closer oversight and give MACs the ability to make changes that can make more of a difference over the life of the contract.

One of the most interesting points of the study was how CMS could incentivize and disincentive MAC contractors based on performance. As we all know, the Centers for Medicare and Medicaid Innovation are all about quality and implementing rewards and penalties for quality outcomes.  

The study indicates that CMS has analyzed these opportunities and they are not workable in the current MAC contracting environment. Further, the GAO recommends changing the cost structure to a fixed cost versus a cost reimbursement option—similar to competitive bidding for DME, pay a single payment amount, so to speak, and the contractors have to make it work.

When DME suppliers submit bids for three year contracts, we are essentially establishing a fixed cost at which we are reimbursed for a three year period.

CMS’s response to previous discussions  on this topic indicate that it would be too difficult to predict the workloads and the specific costs that contractors would incur over the length of the contract; needless to say, this is exactly what competitive bidding does.   

It is interesting that CMS deems it appropriate to apply these requirements to suppliers who take care of patients every day and not to government contractors. In addition, CMS has cost reports submitted by MACs going back 8 years. Could these not be evaluated to determine a benchmark for fixed costs that can be applied? Just something worth thinking about.