WASHINGTON, DC – Key provisions in CMS’ just-released ESRD/DMEPOS Final Rule appear to be largely in line with those contained in the Proposed Rule, according to AAHomecare’s initial analysis.
- Extends the 50/50 blended reimbursement rates for rural and non-contiguous areas (i.e., Alaska & Hawaii) through December 31, 2020.
- Establishes a new method for determining SPAs under the bidding program using maximum winning bids.
- Implements lead item pricing for future competitive bidding rounds.
- Beginning January 1, 2019 beneficiaries may receive DMEPOS items from any Medicare enrolled DMEPOS supplier until new contracts are awarded under the next round of the bidding program. CMS expects that this gap period will run through Dec. 31, 2020.
- CBA pricing will be subject to annual CPI adjustments until the next bidding round takes place.
- CMS will create a new class for portable liquid oxygen equipment by splitting the existing class of portable gaseous and portable liquid oxygen. CMS would increase the payment amount for the new portable liquid oxygen class so that it is the same as the OGPE (oxygen generating portable equipment) rate.
- CMS will change the way that it calculates budget neutrality. Under the new methodology, CMS would apply the offset to all oxygen and oxygen equipment classes and HCPCS codes beginning on January 1, 2019. CMS provided an example of the impact of the new budget neutrality method and additional oxygen payment:
The Final Rule does not incorporate two significant priorities that both HME stakeholders and many Members of Congress supported: 1) Extending the 50-50 blended rate relief for rural and non-contiguous areas to all non-bid areas, and, 2) Providing more relief for suppliers in CBA areas by retroactively applying CPI adjustments. AAHomecare advocated for initial adjustments based on the increase in the CPI since 2013 through 2018.
AAHomecare will provide additional details and analysis on the Final Rule.
Statement from AAHomecare President and CEO Tom Ryan
The ESRD/DMEPOS Final Rule delivers much-needed improvements for future rounds of the competitive bidding program and provides welcome relief for suppliers serving Medicare beneficiaries in rural America. I am particularly gratified that leaders at HHS and CMS have taken a comprehensive look at the impacts of the bidding program and have incorporated input from the HME community in developing these regulations.
While I believe that CMS is making a smart decision in pausing the bidding program to work on additional fixes, I’m disappointed that the Agency is allowing pricing generated under this flawed program to stay in place until the next bidding round. While many suppliers who did not win bids will take advantage of the chance to serve Medicare beneficiaries again during the gap period, they will be contending with rates that provide razor-thin or even negative profit margins. Those same unsustainable rates will also be felt by suppliers in non-bid areas, who face higher costs in serving more widely-spread patient populations. These suppliers can’t wait for more the more sustainable rates that we expect from future rounds of an improved bidding program; they need relief now.
The gains for HME in the Final Rule would not have been possible without exceptional grassroots advocacy efforts from all corners of our industry. Thanks to the dedicated efforts of suppliers of every size, our state and regional association partners, and other leading HME stakeholders, we’ve strengthened our capacity get Capitol Hill educated and engaged on our policy priorities, which has been critical in convincing regulators to take a close look at the bidding program. AAHomecare will again depend on the support of this highly effective network of HME advocates as we press for more relief for suppliers in CBAs and non-bid areas before the next bidding round takes effect.