July 06, 2016

by Inside Health Policy

House Passes Bill Delaying July 1 DME Cuts, Next Steps Unclear

The House on Tuesday (July 5) passed a bill to delay durable medical equipment supplier payment cuts in rural and non-competitive bid areas for three months -- though the cuts went into effect July 1 -- and suppliers are urging the House and Senate, which passed its own version of a delay in June, to come together and find a way to delay the DME supplier pay cuts before Congress again goes on recess after July 15.

“With Congress set to adjourn on July 15, there’s a real sense of urgency to finding a workable solution by next week,” said Tom Ryan, president and CEO of the American Association for Homecare, in a statement. “If the [home medical equipment] community and Congress can’t get rural relief legislation passed, I expect to see more reports of rural providers who are either curtailing their offerings to Medicare beneficiaries, abandoning the program altogether, or going out of business.”

CMS was required to adjust Medicare fee schedule amounts for non-competitive bid areas by Jan. 1. The agency decided to phase in changes to the DME fee schedule rates during the first half of 2016 so that the rates in all areas would be based on a 50/50 blend of current rates and adjusted rates. The second round of cuts was implemented July 1, and suppliers have called for lawmakers to retroactively delay those cuts.

One industry source said CMS isn't holding claims as it did when it expected legislation to delay Sustainable Growth Rate cuts, but providers can hold their claims and wait to see what happens.

The House was expected to vote on its version of the bill, which includes a three-month delay of the cuts and language mirroring the Ensuring Access to Quality Medicaid Providers Act, prior to lawmakers leaving for the July 4 holiday, but that vote was put on hold by Democrats' sit-in over gun control and lawmakers passed the bill by voice vote when they returned on Tuesday.

“We applaud the U.S. House of Representatives for passing this legislation, which will now delay cuts that took effect in July 1. This legislation is a positive step, but at least 12 months is needed to ensure adequate time to measure and monitor the impact of earlier cuts that took effect on January 1,” said Dan Starck, chair of the Council for Quality Respiratory Care, in a statement.

The Senate version of the bill would delay the cuts by a year, lock in the bid ceiling for future rounds of bidding at the bid rates in effect on July 1; require CMS to solicit stakeholder input and take into account travel costs, volume, clearing price and information on the number of suppliers in a bid area as part of rate setting in January 2019 and after; and push up the date when Medicaid reimbursement will match Medicare competitive bid rates from January 2019 to October 2018.

Ryan praised both the House and Senate for passing their respective bills, saying the action is a clear signal that lawmakers want to put off these cuts, but now the chambers need to complete the process and send something to the president. “With the new rates going into effect, we need our champions in both the House and Senate to find a way to move forward immediately,” Ryan said.

However, an industry source said the next steps are unclear. There are a clear set of options -- either the House takes up the Senate bill, the Senate takes up the House bill, or the two chambers move to conference their respective bills -- but there are questions about what the lead players in both chambers will decide to do, the industry source said.

The original House version of the Patient Access to Durable Medical Equipment Act was similar to the bill that passed the Senate, but Inside Health Policy previously reported that the offset that passed the Senate was problematic in the House, so the House package was changed.

There is some resistance in the Senate to taking up the shorter delay, but there is also an understanding that lawmakers need to find a way around the impasse, the industry source said.

The chambers need to engage with each other, the industry source said, and there are questions about whether a longer delay of the cuts is possible if there is an offset attached that lawmakers are more comfortable with.

The important thing is that bills have passed in both chambers, and those bills at least establish some parameters for a potential compromise, or for one of those bills to pass in the other body, an industry lobbyist said. But there's not a lot of time. -- Michelle M. Stein (mstein@iwpnews.com)

To learn more, visit cqrc.org and follow CQRC on Twitter at @TheCQRC.

Click here to see the original article on the Inside Health Policy website.

Learn More About Home Respiratory Therapies:

Millions of Americans are living with COPD and Obstructive Sleep Apnea, experiencing acute respiratory failure, or living with neuromuscular diseases. These individuals rely upon home respiratory therapies to remain at home. Learn more about home respiratory therapies and how they can help.

Stay in Touch:

Subscribe to our newsletter