New Medicare Reform Bill Friendlier to HME
Providers may soon spend less time filling out forms and worrying about audits. If a bill introduced August 3 by Reps Nancy Johnson (R-Conn) and Pete Stark (D-Calif) replaces the Medicare Education and Regulatory Fairness Act (MERFA) bill (S 452, HR 868), Medicare reform could remove many of the burdens that have plagued the industry, such as excessive paperwork, confusing DMERC policies, and excessive underpayment fines.

Victory number one: Simply being mentioned. MERFA excluded HME suppliers. The Johnson-Stark bill, the Medicare Regulatory and Contracting Reform Act (HR 2768), corrects this oversight and includes many of the American Association for Homecare’s recommendations.

A significant change required by the Johnson-Stark version of Medicare reform is eliminating intermediaries and carriers, such as the DMERCs. Instead the reform will combine both parts A and B of the Medicare program into Medicare Administrative Contractors.

Other provisions of the 64-page bill include:

• Barring the Health and Human Services (HHS) Secretary from applying any policy retroactively for all but a few circumstances.
• Requiring HHS to issue regulations only on a specific day per month or quarter to simplify keeping up with Medicare changes.
• Ensuring that all Medicare Administrative Contractors furnish provider education and technical assistance, as well as help providers by designating a Medicare Ombudsman.
• Lessening the control that Medicare Administrative Contractors have in performing prepayment audits.
• Allowing providers to correct small errors and deletions on claims without filing an appeal.
• Limiting how Medicare can use sampling and extrapolation when assessing fines for underpayments. In the past, Medicare lawyers used this system to assess huge fines, such as the $9 billion Medicare says Apria Healthcare Group Inc, Costa Mesa, Calif, owes.
• Giving providers 3 years to pay back overpayments if they can demonstrate financial hardship.

“It is a step forward for home care providers, and we will be working with the sponsors to move this legislation forward,” says Tom Connaughton, AAHomecare’s president and CEO.

While Waiting for Medicare Reform, Scully Announces CMS Improvements
The Centers for Medicare and Medicaid Services (CMS) is enacting three new programs to make the agency more responsive to the public, administrator Thomas Scully told the Senate Committee on Commerce, Science, and Transportation on July 23.

CMS will increase consumer support through monthly Open Door Policy Committee meetings with provider and beneficiary groups, and a series of regional listening forums open to the public. In-house teams at CMS will design new ways of doing business that reduce administrative burdens and simplify regulations, thereby making Medicare more user-friendly. Finally, in October CMS plans to launch an Internet Medicare Personal Plan Finder, which will assist beneficiaries with their health plan choices, and development of a quarterly compendium of all changes to Medicare that affect providers, making it easier for them to understand and comply with regulations and instructions.

VGM Goes Home to the Heartland If Waterloo, Iowa (population 65,022), weren’t VGM’s headquarters already, it certainly would be on September 5-7. That is when VGM Group members, more than 50 manufacturer representatives, and more than 30 speakers will descend on the middle-America town for educational sessions, 18,000 square feet of product exhibit space, and plenty of good ol’ networking. It is all part of The VGM Group’s 2001 Heartland Conference, formerly the Heartland Seating and Mobility Conference. Held at the Five Sullivan Brothers Convention Center, the conference will cover seating and mobility, orthotics and prosthetics, business development, and case management/rehabilitation fundamentals. Featured speakers include Cara Bachenheimer of Epstein, Becker & Green, Washington, DC; Jane Bunch of Jane’s Billing & Consultation Services, Marietta, Ga; Wallace Weeks, of The Weeks Group, Melbourne, Fla; and David Williams of the American Association for Homecare. For more information, contact the VGM Group Heartland Conference Department at (800) 642-6065 and look for online news from the show at www.HealthBizNews.com.

State Watch

Alabama — The Alabama DME Association (ADMEA) is offering its delivery technician certification seminar on Saturday, September 29. Taught by Mike Hamilton, ADMEA’s executive director, the course is intended for well-trained technicians with a minimum of 6 months of experience. Contact the ADMEA at (205) 942-7722; admeal@telocity.com. Colorado — A new Medicaid demonstration program, approved by Tommy G. Thompson, US Department of Health and Human Services (HHS) Secretary, will allow elderly or disabled individuals who qualify for Medicaid the opportunity to control and manage their personal care and skilled nursing services. The 150 Medicaid beneficiaries who enroll in this program will be able to choose the types of home care services and the providers of those services, including family members, that best meet their individual needs. Funds that would have been paid to home health agencies will go directly to the disabled or elderly individuals who are able to direct their own care. Individuals will also be able to accumulate savings, which, with prior authorization, may be used to purchase items and/or services that will support additional health care needs. This could lead to increased sales for state HME providers. District of Columbia — Home health providers operating out of Maryland and Virginia may soon be unable to continue seeing patients in Washington, DC. The licensure requirements published by the District of Columbia Department of Health require that providers have an office in the District of Columbia. Licensure fees, insurance standards, and guidelines for the provision of services will also be established by the proposed rules. Kentucky — A regulation to establish criteria for the delivery of DME, medical supplies, prosthetics, and orthotics to Medicaid beneficiaries went into effect June 8. Adopted by the Kentucky Cabinet for Health Services, Department for Medicaid Services, the regulations cover payment methodology, and prior authorization and documentation requirements. For a copy, contact Seth Johnson at the American Association for Homecare (AAHomecare), (703) 836-6263; sethj@aahomecare.org. Massachusetts — A proposed rule about HME, oxygen, and respiratory therapy services issued by the Executive Office of Health and Human Services in Massachusetts clarified that air conditioners are not covered under these services. Wyoming — As of July 1, legislation (HB 185) requires that all state health insurance policies must provide coverage of diabetes outpatient self-management training, education and equipment, and supplies. This could increase funds available to providers of diabetic products.

Legislative News

Patient’s Rights Bill Could Benefit HME Industry
The Patient’s Rights Bill (HR 2563), passed by the House of Representatives, includes some goodies for HME providers. The bill requires that health plans provide quick payment of claims submitted for health care services or supplies and shortens the decision-making time in the prior authorization process to 28 days. In addition, managed care plans can not discriminate against providers based on licensure.

Elimination of 15% Home Health Cut Threatened
The $14 billion set aside to eliminate the 15% cut in home health Medicare reimbursements over the next 10 years may be spent on other programs. A Republican Party memo reported by the Bureau of National Affairs says declining federal tax collections and the cost of President Bush’s $1.35 trillion tax cut will mean Medicare may have to spend some of its surplus money on its existing obligations.

The MED Group and AAHomecare Partner on Web Site
AAHomecare and the MED Group have teamed up to launch Capitol Connection, an Internet-based tool for the HME industry that allows providers to contact their Congressional representatives and stay up to date on industry-related legislative issues. Providers can access Capitol Connection through AAHomecare’s Web Site at http://www.aahomecare.org/govrelations/gr-tools.htm   or by visiting the MED Group’s site at http://capitol.medgroup.com.