Where Do We Go from Here?
HME continues to secure policy wins, but what will the industry need to do to keep its advocacy momentum going in 2020?
The start of a new decade finds the HME community facing this
question: how can we protect and enhance our industry’s unique role in the
healthcare continuum and position ourselves to take advantage of major opportunities
that lie ahead?
Count me as one of the optimists who believe that HME is poised for a future
of growth thanks to our nation’s demographics and HME’s potential to deliver
cost-effective care in a patient-preferred setting.
The demographic argument is clear and unmistakable. The population of
older Americans, who make up the lion’s share of HME users in many product
categories, is set for a steep growth trajectory in the decades ahead — and especially
in the next decade. From 2020 to 2030, the number of individuals aged 65
and above will grow from 56 million to 73 million, a 25 percent increase. The
number of individuals 85 and up will grow even more rapidly with a 35 percent
spike. By comparison, the population aged 64 and below is set to grow by just
2 percent over the decade.
This is a senior population that will want and expect healthcare resources
that help them stay at home, and HME can play a major role in their care. Put
simply, mobility solutions, respiratory therapy, medical supplies and other HME
products will not go wanting for individuals who need them.
At the same time, the cost of healthcare, especially for senior citizens and
people with disabilities, is a cause for concern for individuals, families, and
Net Medicare spending — meaning the share of federal outlays not offset by
beneficiary premiums — is set to more than double over the next decade, as
well, eclipsing the $1.2 trillion mark. On a per-capita basis, Medicare spending
will increase by about 5 percent over that period. In addition, the ratio of
workers contributing Medicare payroll takes per retiree is expected to stand at
2.4 workers per retiree, a ratio steadily declining from 3.7 workers per retiree in
1970. While Medicaid enrollment is growing at a slower pace, overall Medicaid
spending is also expected to grow at by more than 5 percent in 2020.
The Federal government and the states will continue to look to cut costs wherever
they can to help rein in Medicare and Medicaid outlays. The good news is
that the industry is making an effective case with legislators and regulators,
both in D.C. and in state capitols, for more sustainable reimbursement policy.
Pushing Back Against Reimbursement Cuts
After CMS consistently pared down HME reimbursement through a series of
cuts dating back to the late 1990s, and also through the advent of the bidding
program in 2008, the industry finally saw a small measure of relief for rural
and non-bid-area suppliers in 2018. The Agency has also incorporated several
reforms championed by AAHomecare and other industry stakeholders into
regulations and requirements for CB Round 2021.
At the state level, AAHomecare’s investment in developing and staffing a
payer relations program has paid major dividends for our industry. In addition
to various successes in maintaining open access for HME companies, we’ve
worked with state and regional association partners to stop or limit proposed
Medicaid rate cuts in dozens of states.
We’ve made important strides towards stabilizing HME reimbursement rates,
payers need solutions that will help keep overall healthcare spending in check,
and a population cohort that depends on our products and services is growing.
It points to a future with great opportunity for the HME — but we have to position
ourselves to take advantage of it.
Selling the Value Proposition for HME
The value proposition for HME is easy for individuals in our industry to understand.
We have a front-row view of how our products deliver medical benefits
and positive outcomes for patients in a home-based setting. When compared
to the costs of hospitalization, extended rehab facility stays, and other clinical
interventions HME helps prevent or limit, the value we deliver is unarguable.
But what’s apparent to us isn’t as widely known or accepted by regulators and
legislators as it should be. We’ve made progress in communicating the benefits
of HME on Capitol Hill through persistent grassroots advocacy and face-to-face
lobbying in recent years — but we need to accelerate the understanding of our
value proposition if we are going to cut through the hundreds of healthcare issues
competing for Congress’ attention and action. Incremental gains just won’t cut it.
Better Data Can Make the Difference
Our payer relations team’s success in helping hold the line on proposed Medicaid
reimbursement cuts has been underpinned by a focus on educating state regulators
and legislators on the value of HME. AAHomecare’s newly established Payer
Relations Council plans to build on this success by developing a framework to
obtain more data from state Medicaid authorities and MCOs to better understand
the broad fiscal and patient-outcome impacts of reimbursement cuts.
This effort will include streamlining our FOIA request process to get claims
data from states and MCOs. This data will help us better demonstrate the value
of HME to payers, which should prove useful in negotiations on rate-setting
and efforts to promote quality standards. We plan to apply lessons learned from
these state-level efforts to supplement and improve our capabilities in obtaining
data from CMS, as well.
AAHomecare and other HME advocacy organizations need more data that
regulators and policymakers can’t discount as anecdotal or subjective to bolster
our case for sustainable reimbursement rates and access to our industry’s products
and services. Improving our ability to access and utilize claims data from
state, MCO, and Federal sources regulators needs to be a top priority for our
industry; I’m excited that AAHomecare is making a stronger commitment to
making this happen.
Bringing More Resources to the Fight
We’re seeing sustained grassroots advocacy efforts on Capitol Hill generate
stronger support for HME policy priorities. Our latest win was the permanent
exclusion of manual CRT wheelchairs from the bidding program. That said,
we need even more resources to help us fight for more sustainable reimbursement
rates from Medicare and other payers. AAHomecare has made growing
our membership a priority for 2020. With more companies actively involved in
HME advocacy and with additional financial resources, we can accomplish even
more — and make sure that we can all be a part of a better future for HME.
This article originally appeared in the January/February 2020 issue of HME Business.
Tom Ryan is the president and CEO of the American Association for Homecare (Washington, D.C.), the industry's national association.