Moving the HME Industry Forward

Legislative/Advocacy

Top Ten Ways Government Attacks Medicare Patients

April 14, 2014

TUCSON, AZ – Drastic changes to Medicare—many hidden to patients until they are hit with higher costs or denial of services—have been transforming Medicare since Obamacare took effect. The draconian changes to Medicare rules affect your ability to get needed home health equipment and supplies, medical care, hospitalization, surgeries and medications—and even to pay cash with your own money for services you need.

Let’s look at the Top Ten changes seriously harming Medicare patients:
1) Medicare’s new rules for vendors of home health equipment and supplies are ironically called “competitive bidding” when in fact, the rules are anything but.  The new program designed by CMS has serious flaws that adversely affects patient access to medical equipment and supplies, reduces patient education on how to use home-based equipment and supplies, and drives established, reputable vendors out of business.  All in the name of “cost savings.” But how many lives will be lost when patients cannot get the home medical equipment or supplies they need to manage serious illnesses?

The new bid rules:
• allow vendors to place non-binding bids that they can rescind once a contract is awarded and local suppliers knocked out of providing services;
• do not vet vendors to ensure they are actually qualified to provide the services and equipment;
• cut costs to such low prices that vendors are driven out of business. For example, Medicare reimbursement rates will be reduced by 45% below the current fee schedule, on average, and cut 72% below current rates for diabetic supplies. What business can survive with a 45% or 72% cut in revenue?  

As a physician, I see the damages that happen to patients when cost is the focus rather than quality of care.  As a spouse, we experienced these problems personally when the local vendor for my husband’s CPAP machine and oxygen concentrator were forced out of service in Tucson when the bid went to an out of state contractor who had no patient service representatives in Tucson.

Patients’ lives are at stake if they are not fitted properly for CPAP or shown how to use the equipment correctly. Sending a machine by UPS does not help a patient learn how to use it or get a mask to fit properly.  

2) Obamacare’s new Medicare rules deny payment if a hospital patient is readmitted within 30 days of discharge. This is particularly damaging to patients when their home health services are being cut, when they are not shown how to use home medical devices properly, and they have to go back to the hospital to be stabilized.  This hits hardest for patients with chronic lung disease, congestive heart failure, diabetic coma, and other such medical problems needing brief readmission to stabilize life-threatening situations. If not re-admitted when medically needed, patients may die. Catch-22 happens if they are readmitted to hospital “under observation,” then get hit with unexpected exorbitant hospital bills, as I explain below.

3) Hospitals increasingly are classifying hospitalized Medicare patients as being “under observation,” rather than admitting them as “in patients,” not telling them this means thousands of dollars in out-of-pocket costs. Only “inpatient” status is covered under Medicare Part A. “Observation” status comes under Part B. After discharge, patients learn about exorbitant hospital bills and increased co-payments for medications, procedures, and tests. Worse, without an inpatient stay, rehabilitation services and skilled nursing care will not be covered by Medicare, hitting unsuspecting patients with huge added medical bills.

4) The new Obamacare 2.3% medical device tax inflates the cost of pacemakers, stents, knee/hip/shoulder replacement devices, prosthetic limbs, etc. All of these are more often used by Medicare patients, who are likely the ones hit harder by higher costs when living on a fixed income in retirement.

5) CMS proposed a 678-page rule (1-6-2014) requiring enrollment in Medicare for all prescribers of drugs covered under Part D Medicare. Currently, medication prescribers only need to have an active state license permitting prescribing. CMS is restricting Medicare beneficiaries’ ability to use their benefits if they see an independent physician outside “the system.” Independent physicians can see patients but cannot order anything for them. It’s like telling an auto mechanic that he can fix cars but he can’t use any tools.

6) 2012 Obamacare rules forced hospitals contracted with Medicare to do FEWER surgeries for Medicare patients to be paid MORE. If employed by the hospital, doctors may not tell you this reason behind failing to suggest a surgery that could benefit you.

7) Other than government-determined copayments, Medicare patients are not legally allowed to pay cash out of pocket for needed “covered” services if they see a Medicare-contracted physician. Patients must find a physician who has legally opted out of Medicare to be able to pay cash for a service, say one that is not available at the Medicare-allowed price—or to keep their medical records from being sent to the federal government medical database.

8) Obamacare’s new direct Medicare taxes also hit retirees harder: a 3.8% tax on unearned income (dividends, rental income, capital gains), and a 0.9% surtax (for those with incomes above $200,000 individual or $250,000 family), added to existing 1.45% Medicare payroll tax.

9) Reduced payments to cancer, heart/lung, and surgical specialists typically caring for older patients. Medicare fee cuts to these specialists can result in payments below the cost of staying in business, so seniors lose access to more doctors.

10) Draconian $716 billion direct cuts from Medicare attack seniors in serious ways from 2013 – 2022: (Source: Congressional Budget Office):
• $66 billion from home health (in addition to the new bid rules that adversely affect access and quality);
• $39 billion from skilled nursing;
• $17 billion from hospice care;  
• $260 billion from hospital services budget;
• $156 billion from Medicare Advantage;
• $145 billion from DHS payments to hospitals;
• $33 billion from all other services

Cost savings to the government, however, are being passed on to seniors with major increases in out-of-pocket costs for devices, higher taxes, higher co-pays on medicines, higher hospital charges. All of these are a huge burden on seniors on fixed income.

Even worse, though, is that all these changes in the rules and regulations can be life-threatening when they lead to covert denial of medical care.  

After a lifetime of service to our country in homes, jobs, and communities, seniors should not now be facing attacks on their medical care by their own government, creating new threats daily to their savings and lives in retirement.

Elizabeth Lee Vliet, MD, is a 2014 Ellis Island Medal of Honor recipient for her work to preserve medical freedom, and the 2007 recipient of the Voice of Women award from the Arizona Foundation for Women for her pioneering advocacy for the overlooked hormone connections in women’s health. Vliet is a preventive and climacteric medicine specialist with medical practices in Tucson, Ariz, and Dallas, Tex. Vliet is also CEO of International Health Strategies, SpA, a global medical consulting company based in Santiago, Chile, whose mission is medical freedom and privacy while preserving the Oath of Hippocrates’ focus on individual patients. Vliet is past director of the Association of American Physicians and Surgeons (AAPS), and received her M.D. degree and internship in Internal Medicine at Eastern Virginia Medical School, and completed specialty training at Johns Hopkins Hospital.