Moving the HME Industry Forward


Rural Relief Legislation Still Possible

July 4, 2016

WASHINGTON, DC – The second phase of bidding-derived cuts for rural and non-bid area suppliers are in effect. With the House currently out of session, there has been no chance of action until now.

Nonetheless, AAHomecare officials are still engaged on Capitol Hill to pass rural relief legislation in both the Senate and House. The fact that the new cuts are going into effect has not diminished the willingness of champions to continue to advocate for relief.

While the Senate successfully passed S. 2736 last week, influential parties in the House remain strongly opposed to the Medicaid pay-for in the Senate bill. At this point, AAHomecare, along with member company government relations staffers and other HME stakeholder groups are working to bring the Senate and House together to find a solution that will pass both chambers.  

The following is the complete text of AAHomecare’s note to members issued last week:
Our industry’s task remains unchanged – we need to pass rural relief legislation, and the July 1 cuts that CMS released last week underscore the urgent need for a legislative fix.

Simply put, HME stakeholders need to continue to raise the volume on the issue to a point that moves the Senate and House to work together and find a way to either overcome the resistance to the pay-for from key House members, or find another solution that pauses these cuts until further study on their effects on beneficiaries can be properly assessed.

We understand that many of you may be staggered by finally seeing the actual numbers of the second phase of rate cuts in print, and disappointed that we’re currently at an impasse in Congress.

However, the severity of the cuts and their impending arrival may ultimately help as we make our case on Capitol Hill.  There’s nothing like a crisis to help spur legislators to action; we need to make sure that we let the House and Senate know that these cuts are taking rural providers and patients to the precipice of disaster.  

The House returns from recess on July 5 and the Senate is back a day later.  We ask that you continue to press your representatives for a solution to this impending crisis for providers and patients alike upon their return.

Second Phase of Bidding-Derived Cuts Brings Reducactions Averaging More than 50% vs 2015 Fee Schedule
WASHINGTON, DC – CMS recently published the second and final phase of the competitive bidding derived fee schedule expansion for 2016. AAHomecare analyzed 26 of the most common DMEPOS HCPCS across the 8 BEA regions to determine the average percentage change.

The analysis includes percentage change between Phase 1 and Phase 2 of the CBP expansion, and percentage change from the 2015 fee schedule and Phase 2 of the CBP expansion. Starting July 1, suppliers will experience roughly a 12.8% decrease across the country from the current fee schedule that began on January 1. The average change between the 2015 fee schedule and July 1 rates is -51.1%. The Mideast will experience the greatest cuts since last year at -52.7% decrease in reimbursement rates.

AAHomecare’s regional breakdown of the pricing analysis can be found here.