PAYGO and Sequester Wins Set the Stage for HME’s Next Major Challenge
As we noted last week, the House and Senate passed legislation that keeps across-the-board 4% PAYGO cuts to Medicare reimbursement from taking effect in 2022 and extends the pause on 2% sequestration cuts through the first quarter of 2022. President Biden signed the measure into law on Friday.
Stopping the PAYGO cuts will keep $429 million more in HME suppliers’ coffers in 2022.
In addition, delaying full implementation of the 2% sequester will prevent an additional $80 million in cuts for now, although that $80 million measure of relief will be balanced by a temporary increase in the sequester in 2030.
Averting the PAYGO cuts and long moratorium on the 2% Medicare sequester dating back to April 2020, along with the other major relief we’ve advocated for since the onset of the COVID-19 Public Health Emergency, allow the HME community to continue to provide high quality care and lessen the stress on hospitals, nursing facilities, and clinicians during the ongoing pandemic.
Next Challenge: Responding to the DME Rule
HME advocates made sure that Congress understood the critical need to stop the PAYGO cuts from going into effect through our virtual legislative conference in September, repeated follow-ups with Congressional staff, and more than 6,700 emails to The Hill through our Action Center.
Now the HME community waits for a long-anticipated DME Final Rule. AAHomecare and other HME stakeholders have made the case in comments and direct outreach to CMS officials to include these measures in the rule:
Permanent adoption of 50-50 blended rates for rural areas.
Permanent adoption of 75-25 blended rates for other non-CBAs.
Provide a meaningful positive adjustment for rates on former CBAs that reflects the market realities faced by the HME community.
Sending a Message that Can’t Be Ignored
While we hope CMS will incorporate these measures into the Final Rule, AAHomecare has been working with our champions on Capitol Hill to address these issues through legislation, if needed. Once CMS reveals their plans for reimbursements going forward, HME advocates will need to make a strong and sustained case for realistic, sustainable, market-driven rates.
AAHomecare and other leaders in our industry will provide talking points, data, and guidance on how to send a message that the House and Senate can’t ignore – and we’ll need every segment of the HME community on board! Get ready to fight – and win – in 2022.
AAHomecare Shares 2022 Fee Schedule Analysis for Top 25 DME Items
AAHomecare’s analysis of the top 25 DME items shows the following average rate increases for CY 2022 compared to rates currently in place:
CBP items in former CBAs: +5%
CBP items in rural areas: +4.9%
CBP items in non-rural areas: +5.1%
The CY 2022 CPI-U increase is applied to the current public health emergency (PHE) relief rates of 75/25 blended rates in non-rural areas and 50/50 blended rates in rural areas. The 2022 DME rates also reflects the removal of the oxygen budget neutrality offset that was implemented in April 2021.
You can download AAHomecare’s top 25 HCPCS codes analysis (Excel spreadsheets) here:
SMRC and RAC Post New Audits Including Surgical Dressings, Enteral Nutrition, and Parenteral Nutrition
The Supplemental Medical Review Contractor (SMRC) recently posted a new audit for surgical dressings. The review will be on all HCPCS listed in the Surgical Dressings LCD (L33831) for claims with a date of service (DOS) between January 1, 2019- December 31, 2019. The SMRC notes that surgical dressings rank as the one of the top four product categories with the highest improper payment rate. The 2019 Comprehensive Error Rate Testing (CERT) improper payment rate for surgical dressing was 62.8%.
You can find more information on this review here.
In addition, the Recovery Audit Program contractor (RAC), Performant Recovery, posted two new approved audits on Enteral Nutrition Therapy and Parenteral Nutrition Therapy last week. Both are complex reviews and the RAC will be reviewing whether the therapies were reasonable and necessary. These reviews will affect claims with a date of service on or after September 5, 2021.
You can find additional information on the reviews at the links and the list of affected HCPCS codes:
OIG Finds Overpayments for DMEPOS Items for Medicare Patients in Hospice
On November 16, Department of Health and Human Services Office of Inspector General (OIG) published the report titled, “Medicare Improperly Paid Suppliers an Estimated $117 Million Over 4 Years for Durable Medical Equipment, Prosthetics, Orthotics, and Supplies Provided to Hospice Beneficiaries.” The OIG found that between January 2015 - April 2019, Medicare overpaid DMEPOS suppliers $116.9 million for DMEPOS items provided to beneficiaries enrolled in hospice. The OIG identified that the improper payments oversight process and DME supplier’s unawareness were some of the reasons for the overpayments. The OIG recommended CMS to implement changes to the Common Working File (CWF) edit process, conduct data analysis to include suppliers that regularly improperly submit claims for hospice patients to TPE, and review the feasibility of expanding the hospice benefit to include coverage of all DMEPOS items patients use when enrolled in the hospice benefit program.
You can find AAHomecare’s summary of the report here.
Kentucky Suppliers Face Emotional Task Caring for Patients After Tornadoes
USA Today reported at least 30 tornadoes struck Kentucky, Illinois, Tennessee, Missouri, and Arkansas from Friday to Saturday, December 10-11. The destruction included more than 1,000 properties, 25,000+ homes without power in Kentucky alone, as well as the loss of more than 80 lives. Natural disasters at any time of the year are devastating, but during the holidays and in the midst of a pandemic, they can take an even larger toll.
HME providers like CherriCare Medical Equipment and Supplies in Owensboro, KY and King Drug & Pharmacy in Hartford, KY are among the suppliers on the frontlines who are helping patients in overwhelming circumstances. Here are some perspectives from these companies as their teams care for patients under these challenging conditions:
“Not sure how to put into words these past few days. We stayed up all Friday night, waiting for the calls. We were unaware that cell towers were down. We started getting calls on Saturday. Families have been so gracious and appreciative of all the offers of help.
The community and the state organizations that have reached out are amazing. Trying to ‘re-home’ or re-house patients that have lost everything is stressful. When Hospice organizations and nursing homes call to say they have beds, it makes it so comforting that human beings are reaching out to one another. They are not worried about how they will be paid or if they will be reimbursed for care. They are just helping. I am overwhelmed and have been tearful all week at the devastation and the outpouring of kindness!
After getting through the trauma and care of Covid patients, it has felt as if it is too much for yet another travesty to occur. We are human beings, and we are here to help one another! It has restored my faith, that there are so many good people and that they really do care.”
Cherri Lolley, RN, BSN
CherriCare, Medical Equipment and Supplies in Owensboro, KY
***
“The most impacted area was in far western Kentucky out of our service area, Mayfield. Many prayers to that community as they have suffered the brunt of the monster Tornado damage.
We had four major service areas affected greatly, Dawson Springs (Hopkins County) with 13 deaths, Bremen (Muhlenberg County) 11 deaths, Hartford (Ohio County) and Bowling Green (Warren) 15 deaths. As far as our patients, fortunately at this time, the only lost equipment we are experiencing are CPAPs and we do have adequate supply at this time to provide replacements.
Many of our oxygen patients have been without power but many have generators or have relocated. We are still looking for a few patients that we have not been able to locate but have not found them listed among the deceased. Our team jumped into action and opened our Branch locations the day after so that those that could get to us for supplies were able to. Our service technicians went out to deliver as many tanks as they could to those without power. We are very fortunate to have these guys on the front lines. We did experience several days of phone and internet outage, so we worked off texts and emails and it took all of us as a team. Thankfully as of yesterday, all of our services are back to normal. We have heard from our state association, KMESA, and other providers who have offered assistance. Thank you all for your concerns and keep the prayers for Kentucky coming. The clean-up and healing will be a lasting effect.”
Amy Willis, RRT, ATP – DME Director
King Drug and Home Care, Hartford, KY
Provider Relief Fund Phase 4 and ARP Rural Updates
This week, HHS announced that the Department is releasing $9B of the $17B that was allocated for Phase 4 General Distribution. HHS shared in the announcement that they have plans to release the remaining $8B early next year.
If the Recipient’s Phase 4 [ARP Rural] payment(s) exceeds $10,000, the Recipient agrees to notify HHS of a merger with or acquisition of any other healthcare provider during the Payment Received Period within the Reporting Time Period (as defined in the PRF Post Payment Notice of Reporting Requirements). Providers who report a merger/acquisition may be more likely to be audited, consistent with an overall risk-based audit strategy.
The updated FAQ provides additional information on this new requirement. See the HRSA Provider Relief Fund site for complete program information.
AAHomecare Councils Cover a Myriad of Issues at In-Person Meetings
Payer Relations Council
In the first week of December, AAHomecare hosted the Payer Relations Council in Arlington, VA for their fourth meeting of the year (second in-person for 2021). The Council discussed payer education, the American Rescue Plan Act, TRICARE, NIV, and Medicare Advantage as well as other important payer issues. 2022 goals for the Council were set and and successes celebrated as this dedicated team reflected on the this year's achievements with state-level and with national payers.
Regulatory Council
The Regulatory Council met in-person the second week of December in Arlington, VA. The Council continued their discussions on the future of competitive bidding, the ramp-up of audit activity, and regulatory issues around waivers in place the during the public health emergency. The Council will be meeting again in-person in March 2022.
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Tom Ryan, president, and Jay Witter, senior vice president of public policy, met with Representative Paul Tonko (D-NY)…Witter met with Representative Brett Guthrie (R-KY)…Laura Williard, vice president of payer relations, participated in a meeting with Florida’s Sunshine Health, and attended an ATHOMES Payer Relations Committee call… David Chandler, senior director of payer relations, met with CareCentrix, NEMEP Board of Directors meeting, met with NY Assemblyman McDonald with NEMEP, TexMEP Board of Directors meeting, Virginia Medicaid meeting with ACMESA, IN Rep Brown meeting with Great Lakes…Ryan, Williard, and Chandler, met with Integra regarding increased costs and supply chain issues...Williard and Chandler met with the Health Nutrition Council regarding TRICARE enteral, and the Defense health agency and Humana military regarding claims processing issues and delays...Williard and Tilly Gambill, director of marketing communications, met with the Washington State and Illinois lobbyists regarding the elimination of sales tax for breast pumps..Kim Brummett, vice president of regulatory affairs, and Ashley Plauché, director of membership and public relations, participated in an Access and Care Coalition meeting…Plauché met with NRRTS regarding the Unite4CRT Opportunity…
AAHomecare’s Payer Relations NIV Workgroup, Home Medical Equipment and Respiratory Therapist Council, Executive Committee, Payer Relations Vertical Integration Sub-Group, Ostomy/Urologicals Work Group, State Leaders Council, Breast Pump Coalition, Woundcare Work Group, Payer Relations Council, and the Regulatory Council convened…
AAHomecare hosted a webinar with Brown & Fortunato and Jackson Walker on Sales Tax for HME …
