Congress, CMS: Slow down cuts to home oxygen

It is rare to get agreement – even when everyone is interested in the same thing – particularly when it comes to healthcare policies in Washington.  It’s remarkable then, that the entire U.S. home respiratory therapy community has come together to support legislative relief related to a 30-50 percent reimbursement cut that threatens access to home respiratory therapies – including home oxygen and home sleep therapies – for the most vulnerable of patients: Medicare beneficiaries. 

It’s a national crisis with deep implications.  More than one million seniors nationwide depend on the types of services that are jeopardized by these cuts. Without access to the home oxygen, equipment and related services they need, these patients are indisputably at risk for – and can likely expect to suffer from – poor healthcare outcomes and crises related to their respiratory conditions.

{mosads}Rotech Healthcare is among a national group of respiratory therapy suppliers, manufacturers, patient advocates, pulmonologists, and other physicians who are raising a red flag and – with rare, universal agreement – calling on lawmakers to support passage of legislation that would allow for a safer and longer phase-in of these draconian cuts.

Like our colleagues across the country, we at Rotech want to protect patients from harm and negative health outcomes related to steep and rapidly implemented funding cuts. But I fear it will be impossible unless CMS agrees to review and revise its method for setting these rates using more accurate data.

These issues—non-binding bids, median price bids, composite bids, inability to find a clearing price and a lack of transparency—taken together, lead to an arbitrary pricing scheme. According to economist Peter Cramton, “CMS set arbitrary prices for Medicare Durable Medical Equipment (DME) supplies based on CMS’ flawed bidding process. It was not the bidders who set the prices, but CMS through its arbitrary manipulation of the quantities associated with each bidder. CMS was able to pick any price between the lowest bid made by any bidder and the highest bid made by any bidder through its selection of quantities. The CMS-set quantities are never revealed and never used for anything but setting the price. This is why the CMS process is not an auction at all, but an arbitrary pricing process.”

Unfortunately, instead of listening to these diverse parties speaking with a single voice about the issues we see firsthand every day, CMS has chosen to use partial data and flawed analyses to try to justify its overreaching cuts. 

One of the most serious indicators that CMS policymakers have missed the mark is a press release declaring that, “A valuable indicator of whether payment amounts are sufficient is the percentage of claims that suppliers submit as accepting assignment, meaning that the suppliers accept the Medicare fee schedule amount as payment in full.” 

It’s a flawed conclusion that any business owner can recognize: given the opportunity to collect zero reimbursement from patients – many of whom are low income and dually eligible for Medicare and Medicaid (about 17.1%) – or to receive 80 percent of the Medicare reimbursement rate, certainly businesses elect to take something over nothing. It’s not ideal any way you look at it, but given this reality, it is little wonder why the vast majority of suppliers accept assignment in order to continue caring for their patients.

Perhaps even more alarming is CMS’ argument in its blog that, “We have been monitoring health outcomes data closely and have not detected any changes in the number of deaths, hospital and nursing home admission rates, monthly hospital and nursing home days, physician visit rates, and emergency room visits in 2016…compared to 2015…in the non-competitive bidding areas.” 

Given the nature of chronic respiratory illnesses, four months of data hardly seems sufficient. And interestingly, although mortality, admissions, and emergency room visits are declining for other Medicare populations, the same can’t be said for patients with COPD. Isn’t it possible that – with adequate reimbursement – these negative outcomes for Medicare patients with COPD would also be on the decline?

Despite CMS’ press releases, blog posts and data aimed at convincing us otherwise, these cuts and flawed reasoning simply mean bad outcomes for patients.

Home oxygen therapy and related services keep patients alive, at home and able to breathe. They are not “optional,” and the consequences of losing access to care are dire. Before we go any further down this dangerous path, Congress should tell CMS to provide sufficient time to assess the true impact of their policies, and provide for a longer phase-in of the funding reductions.  Additionally, Congress should demand CMS take account of more comprehensive and accurate cost data – rather than assume they can treat urban and rural areas the same when it comes to competitive bidding.

When different interests come together with a single goal, our government should listen to them and find a solution. 

Tim Pigg is President & CEO of Rotech Healthcare Inc.

The views expressed by authors are their own and not the views of The Hill.