Observation Deck

CMS’s IFR Fake-Out

Like Lucy from Peanuts, regulators have pulled the football out from under the HME industry — and that means Congress must act.

The tale of Lucy and the football has struck the HME industry once again. After CMS's release of the interim final rule (IFR), which could have provided substantial relief to providers in non-bid areas, regulators have once again pulled the football out from under suppliers. The industry had hoped to accomplish meaningful rural relief through the regulatory process, and every initial indicator about the IFR we received was positive — but once released it fell well short of what the industry expected.

As in the past, suppliers will need to rely on Congress for meaningful relief that prevents significant accessibility issues outside of competitive bidding areas. The industry must demand long-term sustainable relief to protect the beneficiaries who need this vital equipment.

As most suppliers know by now, the IFR has gone into effect for what CMS deems to be a rural area. Sparsely populated, rural areas only account for approximately 20 percent of the U.S. population, which significantly narrows the scope of this relief and doesn’t do enough to stop providers closing their doors each week. This demonstrates CMS’s unwillingness or inability to protect the 85 percent of DMEs that are small businesses caring for patients in their communities.

So what should be the rural relief playbook, now that CMS has yanked the football?

The industry must continue walking and chewing gum at the same time. Over the past year, we have expended extensive resources on both the legislative fix and the regulatory solution to this major problem. From here, we must continue to do just that.

CMS must hear from independent suppliers on the state of the industry. Within the release announcement of the interim final rule, which will provide seven months of relief to rural and non-contiguous suppliers, CMS announced it is soliciting comments for rates in 2019 and beyond. It will be crucial to have an abundance of comments from independent suppliers as they determine the rates for after Dec. 31, 2018. While we won’t be able to change what is in the IFR, the industry must pull out all the stops to drive proper pricing beyond 2018.

Regulators cited the volume of public comments several times throughout the IFR, which means the industry must overwhelm CMS with comments on this issue. Suppliers must submit comments at regulations.gov on the document “Medicare Program: Durable Medical Equipment Fee Schedule Adjustments to Resume the Transitional 50/50 Blended Rates to Provide Relief in Rural Areas and Non-Contiguous Areas CMS-1687-IFC,” which can be found at bit.ly/2HQ9pE6. Comments are due by July 9, 2018, so there is still plenty of time to get them in!

Congress must act for full relief, which lies in H.R. 4229. Congress has clearly expressed their intent to fix the flaws of the competitive bidding program. There have been several occurrences to demonstrate that disapproval of the program including the 21st Century Cures Act, countless “Dear Colleague” letters, policy briefings, or the numerous congressional offices who have reached out to HHS/OMB to get this problem solved. Congress has shown that they do not believe in the application of flawed competitive bidding pricing being applied to the rest of the country. With regulators showing their blatant lack of interest in following the intent of Congress, it is time for action from our elected officials.

With the August recess quickly approaching in an election year, members of Congress will be very active back in their home districts over the next six months. Our team will be taking advantage of every possible opportunity alongside our members, to meet with lawmakers while they tour around their home states. It is not too early to begin preparing for the August recess and requesting meetings with your elected officials to drive support for H.R. 4229, with an emphasis on passing the legislation before the 2018 legislative session comes to a close.

The HME industry has been in this position before where CMS is tripping over $100 bills to pick up pennies to demonstrate savings to the Medicare program. DMEPOS makes up a little over 1 percent of the $672 billion spent on Medicare in 2016, yet CMS continues to cut reimbursements to the industry. Congressional offices now understand that the IFR turned out to be a missed opportunity being labeled as the “IFR that could have been.” 

This feeling has fueled several additional offices wanting to get H.R. 4229 to President Trump’s desk. The industry is also actively working with Senate leadership to introduce a Senate companion bill to H.R. 4229 to improve our chances of seeing legislation move forward. Suppliers and industry stakeholders must do our part to make the industry’s voice heard loud and clear.

All of us have felt the frustration and powerlessness that Charlie Brown has felt as Lucy repeatedly pulled the football out from under him. With the public comment period and extraordinary support for H.R. 4229 which provides real, substantial relief to all non-bid suppliers, there is opportunity on the horizon. The industry has grown tired of this feeling of coming up short, and it is time that we hold our own football.

About the Author

John Gallagher is the vice president of Government Relations at HME member service organization and buying group VGM Group Inc., where he advocates on behalf of the industry. To learn more about VGM Government Relations visit vgmdclink.com, where you can also read additional commentary and find industry advocacy resources.


Wed, Jun 27, 2018 Tom Takubo Charleston, WV

I am a pulmonary and critical care physician in a group practice that currently cares for almost 5 *** patients across southern WV. It is becoming increasing difficult to take care of patients because of the marked reduction in local DME and reimbursement for the services provided. Patients, especially many on Medicare, are confused and feel neglected. Until recently, I have never had patients explain that they weren’t wearing oxygen because they couldn’t get it.

Thu, Jun 21, 2018 David M Leavins Niceville

The HME/ DME industry reimbursement rates have been cut so much that it has forced a large amount of dealers to close or to change the way they do business. The dealers that have remained in this line of work had to change the way they run their operations. Those that were accepting assignment on Medicare, has changed.They are requiring the patient to pay up front. The patient is not getting the amount that they were charged due to cuts imposed by Medicare. Coverage areas have been decreased and delivery of equipment has now been limited. This not only affects patient care but, caring healthcare workers to loose their jobs.

Tue, Jun 19, 2018 Jackson, MS

This industry has been cut too harshly, too often. We can no longer truly service the patient. Customer care has had to go out of the window because of such drastic cuts.

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