The past year has been dominated by the “big three” onerous provisions in the Medicare Modernization Act (MMA). With competitive bidding (number one) further in the future, focus fell on the conversion of average wholesale price (AWP) to average sales price (ASP)+6% for respiratory medications (number two), and the Federal Employees Health Benefits Program (FEHBP) pricing reductions (number three).

On top of those challenges, we had the power wheelchair policy revision issued by CMS, serious delays in claims processing for rehab suppliers, and increased denials. But one of the most frustrating issues has been the information void.

As you know, on the ASP+6% issue, CMS did not release the final dispensing fee number and ASP calculations until late on election day. That meant we were dealing with a large “unknown” for months as we negotiated with CMS and talked to legislators. Was this issue a “win?” Consider that we had multiple meetings with CMS and created an open, ongoing dialogue. Consider that we were faced with a simple ASP+6% and no dispensing fee. Consider that early predictions were for a $15 to $20 dispensing fee that would have forced us out of this business. When you take into account these factors—then yes—our efforts have been successful.

However, we expended a great deal of energy enlisting companies to participate in the Muse Study, and we believe it is truly representative of our industry’s costs. Muse concluded that a dispensing fee of $68.10 would allow a profit margin of a mere 7%. The $57 proposed by CMS will allow some companies to continue providing respiratory medications, while others will be forced to exit the business. CMS Administrator Mark B. McClellan, MD, PhD, has said this is an “interim number.” I agree! It needs to be higher.

As of this writing, the oxygen number has still not been published in regard to the FEHBP reduction. AAHomecare has logged countless meetings, and has engaged a respected firm to evaluate the FEHBP plan data. The consensus is that the data show the actual difference between Medicare allowables and FEHBP payments for oxygen is minimal. Speculation is that CMS will propose a reduction of around 10%. Quite simply, this remains a flawed provision, and we will continue to push for HR 4491 to be reintroduced.

The bottom line is that we are ending the year on an upswing. We at AAHomecare have been thrilled to see the grassroots support for HR 4491. Kudos also go to many of our state associations. We need more of you to get involved and stay involved. May you have a peaceful holiday season and a safe and joyous new year. Then, we roll up our sleeves and go to work again!

Tim Pontius, RRT, is chairman of the American Association for Homecare.