HME Business

Supreme Court Upholds Affordable Healthcare Act

SCOTUS decision means several elements impacting HME will stand.

• By David Kopf
• Jun 28, 2012

In a 5-4 ruling the Supreme Court of the United States upheld the 2010 Patient Protection and Affordable Care Act, which contains several provisions that impact the home medical equipment industry.

The health reform, the largest such overhaul of U.S. healthcare since since the 1960s, had been challenged based on the “individual mandate,” which required nearly all Americans to have health insurance by 2014 or pay a tax.

Critics of the law said Congress did not have the power to force citizens to buy health insurance. However, Chief Justice John G. Roberts, Jr. said, in the court’s decision, that was not the issue at hand.

"The federal government does not have the power to order people to buy health insurance," Roberts wrote. "The federal government does have the power to impose a tax on those without health insurance."

Regardless, the net result for the industry is that Act was upheld, and with it several elements that directly impact HME providers. They are:

• Application of competitive bid pricing be applied nationwide by 2016, and as early as 2015.
• Elimination of the 2 percent fee schedule increase for bid items in 2014.
• Elimination of the first-month purchase option for all power wheelchairs, except for complex rehab power chairs.
• Mandatory face-to-face requirement for all HME items.
• Application of a productivity adjustment to the HME fee schedule payments not subject to bidding.
• A tax on medical devices.
• Expansion of the geographic scope of Round Two of competitive bidding program via including an additional 21 areas across the country:

  Philadelphia-Camden-Wilmington, PA-NJ-DE-MD
  Washington-Arlington-Alexandria, DC-VA-MD-WV
  Boston-Cambridge-Quincy, MA-NH
  Phoenix-Mesa-Scottsdale, AZ
  Seattle-Tacoma-Bellevue, WA
  St. Louis, MO-IL
  Baltimore-Towson, MD
  Portland-Vancouver-Beaverton, OR-WA
  Providence-New Bedford-Fall River, RI-MA
  Buffalo-Niagara Falls, NY
  Rochester, NY
  Tucson, AZ  
  Honolulu, HI
  Albany-Schenectady-Troy, NY
  Worcester, MA
  Oxnard-Thousand Oaks-Ventura, CA
  Springfield, MA
  Bradenton-Sarasota-Venice, FL
  Poughkeepsie-Newburgh-Middletown, NY
  Stockton, CA
  Boise City-Nampa, ID

 

“It would appear that all the negative provisions that affect the HME industry remain the same,” said Tom Ryan, president and CEO of New York provider Homecare Concepts Inc. “… The big question would have been what the alternatives would be if repealed and HME was in play to pay for some of the repeal costs. This industry needs relief now, the uncontrolled audits, the onerous medical documentation and a looming rate decrease have made the future scary. The need to improve care and quality outcome approach that is taking place in the new policies of CMS is counter intuitive to our industry being overregulated and price commoditized.”

Because of that, the industry will continue to work to battle the individual programs negatively impacting it, regardless of the Act.

“We will continue to fight for our issues such as competitive bidding which requires a comprehensive fix, and on the many other fronts,” said Michael Reinemer, vice president of Communications and Policy for the American Association for Homecare.

But, because SCOTUS upheld the Act was upheld, additional problems could be created, according John Shirvinsky, Executive Director of the Pennsylvania Association of Medical Suppliers.

“Looking at the bigger picture, however, it is a disappointment that such a complex and costly measure has been allowed to stand,” he said. “HHS and CMS have been very hostile toward the HME sector during this Administration. There has been virtually no effort to engage on problems with their flawed bidding program, despite being universally panned by recognized and independent experts in the field. New, costly, additional requirements have been piled on almost weekly while reimbursements are being forced downward. Audit activities have reached the point of absurdity. HME providers are closing operations or selling out because of the cost of regulatory burdens outstripping operating costs. And the ACA does nothing to make these challenges better or more bearable. In fact, it is difficult to argue that it will help our industry in any meaningful way.”

If anything, the health reform act will be a reality providers will have to live with, said Wayne Stanfield, president and CEO of the National Association of Independent Medical Equipment Suppliers.

“While many were hoping for a ruling that WOULD change things, as often happens in the DME industry we were hanging out hat, so to speak, on the bet that the Court would change the law,” he explained. “My view is that ACA is full steam ahead and we will live with the results. Whether it will be good or bad will be something for the history books. The ACA train has left the station, and Congress will not overturn it in my opinion, regardless of the election in November. The Democrats in the Senate will never allow a repeal bill to reach the floor, even if they lose the majority. So as I said at to the start, the SCOTUS ruling changed nothing and had no effect on what was already a done deal.”

 

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