HME News is the monthly business newspaper for home medical equipment providers. This controlled circulation publication reaches 17,100 home medical equipment services providers, including traditional HME dealers & suppliers, hospital- and pharmacy-o
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■ ■ The ZPICs have taken on a new level of agressiveness with payment suspensions, says Wayne van Halem. See story this page. News Providers fear worst in Round 2 re-compete . . . . . . . . . . . 1 It's full steam ahead for House bill . . . . . . . . . . . . . . . . . . . 3 State news: Illinois . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 MAMES honors provider Kay Johnson . . . . . . . . . . . . . . . . 6 Briefs Big names support delay WASHINGTON – Senate Finance Committee leaders have asked CMS to delay applying the next round of Medicare reimbursement cuts in rural areas. In an April 18 letter to Health and Human Services Secretary Sylvia Burwell, Finance Committee Chairman Orrin Hatch, R-Utah, and Ranking Member Ron Wyden, D-Ore., express their concerns that six months isn't long enough to detect and correct problems with the rollout of competi- tive bidding to non-bid areas. "It is unlikely that CMS will be able to monitor, analyze, and make any necessary changes prior to July 1, 2016," the letter states. "The ability of the real-time claims monitoring that CMS uses for items provided in competitive bid- ding areas to assess the short-term impact of the fee schedule rate reduction in non- competitive bidding areas is questionable." Infuential group backs bid bill WASHINGTON – The National Federation of In- dependent Business has written a letter of support for S. 2736, a bill that would delay a second round of Medicare reimbursement cuts scheduled for July 1. The NFIB cites the high proportion of HME providers that are small businesses and the high level of service those companies provide in its let- ter. "The next round of the competitive bid- ding cuts threaten the viability of these small businesses," the group stated. AAHomec- are says the NFIB represents 325,000 small and independent business owners nation- wide and its endorsement carries signifcant weight on Capitol Hill. Don Jones, president of Southern Medical Equipment Corp., and director of federal affairs for the Alabama Durable Medical Equipment Dealers Asso- ciation, secured the NFIB's support. OIG sticks to script WASHINGTON – The Offce of Inspector Gen- eral has reiterated its recommendation that CMS match Medicaid reimbursement rates for HME to Medicare rates. The rec- ommendation, published in the OIG's April 2016 "Compendium of Unimplemented Recommendations," suggests that CMS seek legislative authority to limit Medicaid reimbursement rates for DMEPOS to Medi- care rates and further reduce those rates through competitive bidding or manufactur- er rebates. Lowered reimbursement rates could result in approximately $30.1 million in potential savings for states and the fed- eral government, according to the OIG. HOMES names winners NEW BEDFORD, Mass. – The Home Medical Equipment and Services Association of New England has announced its 2016 award re- cipients. They are: Outstanding Volunteer Award, Jason Morin of Home Care Special- ists and Thomas French of Apria Healthcare; Christopher J. Denmark Commitment to Excellence Award, Tamme Dustin of Herron & Smith; and April Mason Homecare Advo- cacy Award, Rep. Bill Keating, D-Mass. The awards were presented in May. locations to serve Medicare ben- efciaries. The agency also awarded nine contracts for diabetes supplies as part of its national mail-order program. Stakeholders also looked to see whether the contract sup- pliers meet any and all licensure requirements—one of the rules of the program that CMS failed to ensure in the original Round 2. "I'd be very disappointed if it was a ton of licensure issues," said Brummett. "We saw a lot more scrutiny at the CBIC this time, but we'll do our due diligence and work with our state leaders to look at licensure." Also under scrutiny: whether contracts were awarded to suppliers that can reasonably be expected to serve the CBAs in which they won contracts. CMS says 92% of contract suppli- ers are already established in the bid area, the www.HMENEwS.cOM / juNE 2016 / HME NEwS 3 By Tracy Orzel, associate editor WASHINGTON – A bill introduced in the House of Representa- tives in May that would delay an upcoming second round of Medicare reimbursement cuts hit the ground running. H.R. 5210, introduced May 12 by Reps. Tom Price, R-Ga., Dave Loebsack, D-Iowa, and Peter Welch, D-Vt., has 40 original co-sponsors. "It sends a great message," said John Gallagher, vice pres- ident of government relations for The VGM Group. "Most of them are on the Energy By Tracy Orzel, associate editor R ESPonDEnTS To a recent HME newsPoll are split over whether accepting a competitive bidding contract from Medicare is a good idea. Fifty-four percent of respon- dents said that, in general, they did not accept the majority of the contracts they were offered, while 32% said they accepted a contract the frst time around, but not the second. one reason: "(It's) not worth it," said Jill Duda, business oper- ations manager at Philadelphia- based Flagship Medical, of the decrease in reimbursement rates and the increase in paperwork. Another respondent, who only accepted one of six contracts (for enteral) during Round 2, said the threat of damaging their reputa- tion of providing quality prod- ucts and service far outweighed the threat of losing business. others say business is just fne without contracts—in some cases, better. David Beshoar, president of MedServ Equipment based in Palatine, Ill., was awarded con- tracts for Round 2, but did not accept any due to low reimburse- ment, nor did he submit bids for the Round 2 re-compete. "In spite of not being able By Theresa FlaherTy, Managing editor WASHINGTON – Industry stakeholders in May had the monumental task of analyzing the newest competitive bid contract suppliers. "We're trying to get a feel for who won the most contracts in what product categories," said Kim Brummett, vice president of regula- tory affairs for AAHomecare. "one of the things we are looking at, since the pricing was lower, are they mostly the big nationals or are we still dealing with mom and pops that won hundreds of contracts." CMS named the contract suppliers for the Round 2 re-compete April 28. The agency said it has executed 586 contracts for seven product categories. The contract providers have 2,200 Concerns resurface in Round 2 re-compete regulatory review House bill introduced and Commerce and Ways and Means committees. But we still need to get folks energized to move it." Like its sister bill in the Senate, The Patient Access to D u r a b l e M e d i c a l Equipment (PADME) Act of 2016 would push back the second cut in non-bid areas from July 1, 2016 to oct. 1, 2017. The only difference between the two bills is the "pay-for." While the Senate bill has a pay-for that would speed up plans to limit federal Medic- aid reimbursement for DME to the Medicare payment rates from Jan. 1, 2019, to oct. 1, 2018, the House bill has a "placeholder pay-for" to give com- mittees time to fnd an alternative approach. " o n t h e H o u s e side, there were some concerns with Rep. Fred Upton, R-Mich., chairman of the House E n e rg y a n d C o m m e rc e Committee," said Jay Wit- ter, senior vice president of By liz Beaulieu, editor WASHINGTON – From a regulatory perspective, the first several months of 2016 have brought pain, and a little bit of relief, to HME providers. Among the pain points, says Wayne van Halem, is the new level of aggressiveness in the actions taken by the ZPICs. The contractors are hand- ing out payment suspensions where, previously, they may have handed out overpayment demands, he says. "Some of the reasons for sus- pensions are ridiculous," said van Halem, president of The van Halem Group. "Because CMS is reorganizing their con- tracts, I have a sneaking suspi- cion they're trying to show CMS that they meet all of the con- tract requirements." An example of a reason for suspension, van Halem says: allegedly leading a physician on an order by using a form titled "Power Mobility Device order," even though the form came from the DME MAC. Another pain point is a new rule that went into effect in March that requires providers to disclose overpayments with- in 60 days, something that has been an expectation in the past Are bid contracts 'worth it'? Suspensions, overpayments and exemptions HME NEWS POLL As stakeholders analyze list of contract suppliers, they worry about, among other things, out-of-staters N E W S p O l l s e e pa g e 6 c O N T R A c T S s e e pa g e 4 B I l l s e e pa g e 4 "Because cMS is reorganizing their contracts, I have a sneaking suspicion they're trying to show CMs that they meet all of the contract requirements." - wayne van Halem R E G u l AT O Ry s e e pa g e 6 Kim Brummett Jay Witter