Respiratory Management

House Passes Health Care Reform

• By David Kopf
• Mar 22, 2010

Ending months of strenuous debate, the House of Representatives approved a sweeping overhaul of the health care system late Sunday night, with a historic vote of 219 in support and 212 opposed. The bill includes various provisions that negatively impact the home medical equipment industry.

The House vote sends the Senate health care reform bill to President Barack Obama, who will sign it into law in the coming days. Also, the House approved various changes to the bill that will be sent to the Senate as a budget reconciliation bill. The budget reconciliation process in the Senate caps debate at a maximum of 20 hours and requires only a simple majority to pass, negating any chances of a GOP filibuster.

The reform bill will commit $940 billion over the next 10 years to provide health care to more than 32 million uninsured Americans, according to the Congressional Budget Office. It will add 16 million Medicaid beneficiaries, as well as subsidize private payer coverage for low- and middle-income recipients.

Additionally, the bill will implement increased protections for beneficiaries to ensure coverage, such as prohibitions against insurers removing coverage when beneficiaries suddenly become ill or blocking coverage due to pre-existing conditions.

However, the bill also includes various provisions that affect HME providers. It will:

• Expand the geographic coverage of Round Two of the national competitive bidding program to include 21 more competitive bidding areas.
• Eliminate the first-month purchase option for standard power wheelchairs (complex rehab power mobility devices would retain the option).
• Apply NCB prices nationwide by 2016.
• Remove the 2-percent fee schedule increase for DME categories covered in the bidding. This increase was promised to providers per MIPPA in exchange for the delay in implementing Round One.
• Require mandatory face-to-faces for all HME claims.
• Enact a productivity adjustment to the HME fee schedule that will annually lower payments by 1 percent to 1.5 percent.
• Establish an excise tax on manufacturers of certain classes of equipment.

After the late-night vote concluded, President Obama addressed the public from the White House, joined by Vice President Joe Biden. “Long after the debate fades away, and the prognostication fades away, and the dust settles, what will remain standing is not the government-run system some feared, or the status quo that serves the interests of the insurance industry, but a health care system that incorporates ideas from both parties, a system that works better for the American people,” he said. “This legislation will not fix everything that ails our health care system, but it moves us decisively in the right direction. This is what change looks like.”

Home care industry leaders were far less enthusiastic about the passage. “For DME suppliers, there is little to be happy about in the historic health care reform bills,” said Wayne Stanfield, president and CEO of the National Association of Independent Medical Equipment Suppliers. “The expansion of competitive bidding to 100 areas and the application of bid rates to all areas by 2016 will have the broadest impact and makes competitive bidding repeal through H.R. 3790 even more critical. In the short-term, the excise tax on medical devices will add cost for suppliers while the loss of the projected 2-percent increase and the productivity adjustments will reduce fees, making a double hit to suppliers.”

John Shirvinsky, executive director of the Pennsylvania Association of Medical Suppliers, said: “This is not a very good bill for the HME industry or our patients. It extends and accelerates the implementation of suicide bidding; there is an anticipated $500 billion in Medicare cuts; and the elimination of the first-month purchase option for power wheelchairs will result in a tremendous financial burden on providers. And while reimbursements are being cut left and right, the measure will increase costs due to the new ‘wheelchair tax’ on device manufacturers. This is a bad day for HME. This is a bad day for Medicare beneficiaries. The elderly and the disabled have clearly been identified as low priorities in this new health care equation.”