As HME businesses rapidly adapted their policies and procedures to respond to the COVID-19 public health emergency, Congress and CMS implemented relief programs and altered the funding environment to help providers keep serving patients. How much of this change will be permanent?
- By David Kopf
- Jun 01, 2020
Between March 3 and 5, HME providers in
the western states traveled to and from Las
Vegas for Medtrade West — and they likely
noticed things were a bit strange. The
airports were pretty empty; fiights were sparsely
attended; not as many people were at the Mandalay
Bay; and Sin City looking a bit like a ghost town.
The week after the show, most events of any
kind were going on hiatus. States would soon
shut down, and before providers could really think
about it, they would be dealing with COVID-19,
a disease that up until then had seen like it was
affecting other people in other places, far away.
COVID-19’s spread was surprisingly fast. The
Wuhan, China outbreak began in December 2019
and by Jan. 20 the first case in the United States
was identified. On Jan. 30, the World Health
Organization declared COVID-19 a Public Health
Emergency of International Concern, and on Jan.
31, the Trump Administration declared a Public
Health Emergency. On Feb. 29, the first U.S.
COVID-19 fatality was reported, and on March 11,
as Medtrade West attendees were probably still
working their way through their show follow-ups,
WHO officially declared COVID-19 a pandemic.
Suddenly, providers had to think about how
they would implement measures to mitigate the
spread of the disease; how they would interact
with patients; how they would drop off and pick
up equipment; how they would work with referral
partners; how they would protect their staff;
how they would comply with state stay-at-home
guidelines; how they would maintain their supply
chains; and how they would keep their businesses
running in all this unforeseen chaos.
With some states already implementing
stay-at-home policies by mid-March, Congress
quickly moved to pass the Coronavirus Aid,
Relief and Economic Security (CARES) Act,
which was signed into law in late March, as well
as the Paycheck Protection Program and HealthCare Enhancement Act, which was signed into
law in late April. The two pieces of legislation
contained billions of dollars in relief that healthcare providers and businesses could tap into,
as well as a series of provisions that relaxed or changed to help HME providers serve Medicare beneficiaries.
All told, the CARES Act was a $2 trillion dollar
stimulus package that allocated $100 billion to
the Public Health and Social Services Emergency
Fund (PHSSEF). Of that, $50 billion was earmarked
for general distribution to Medicare facilities and
providers impacted by COVID-19.
The first $30 billion was distributed proportionately
to providers’ share of 2019 Medicare fee-for-service
reimbursements, with $26 billion paid out
on April 10 and the remaining $4 billion on April
17. Then at the end of April, HHS began distribution
the final $20 billion of the general distribution
to providers to augment their allocation so that
the whole $50 billion general distribution was allocated
proportionally to providers’ share of 2018
net patient revenue.
Additionally, the CARES Act included various
An extension of the 50/50 blended rate for rural
suppliers through the COVID-19 public health
It also provides better rates (a blend using 75
percent current adjusted rates and 25 percent
unadjusted rates) for suppliers in non-rural,
non-bid areas during that period.
Those rates are retroactive to March 6.
An elimination of the 2 percent Medicare
sequester reduction that went into effect in 2013.
This relief will be effective May 1 to Dec. 31.
An elimination of the three-year established
patient relationship requirement from the telehealth
provisions in earlier COVID-19 relief
Then the Paycheck Protection Program and
Health Care Enhancement Act added a total of
$484 billion in relief, with $75 billion going to
healthcare providers via the PHSSEF that was
established by the CARES Act.
The relief bill also included $310 billion for the
Paycheck Protection Program (PPP) and added $50
billion for Economic Injury Disaster Loans (EIDL)
and $10 billion for EIDL Advance grants.
While Congress was passing those two important
pieces of legislation, CMS issued two Interim
Final Rules (IFRs), one in late March and one in
late April, that covered various healthcare issues
related to COVID-19 includes policy recommendations
that industry advocates had been pressing
the Centers to implement.
CMS’s March IFR included various provisions,
starting with CMS stating that it wouldn’t enforce
clinical indications for coverage for respiratory,
home anticoagulation management and infusion
pump National Coverage Determinations (NCDs)
and Local Coverage Determinations (LCDs),
including articles. CMS will resume enforcement
of these clinical indications for coverage once the
COVID-19 emergency has ended.
The LCDs and NCDs include:
- NCD 240.2 Home Oxygen. NCD 240.4
Continuous Positive Airway Pressure for
Obstructive Sleep Apnea.
- LCD L33800 Respiratory Assist Devices (ventilators
for home use).
- NCD 240.5 Intrapulmonary Percussive Ventilator.
- LCD L33797 Oxygen and Oxygen Equipment
(for home use).
- NCD 190.11 Home Prothrombin Time/International Normalized Ratio (PT/INR)
Monitoring for Anticoagulation Management.
- NCD 280.14 Infusion Pumps.
- LCD L33794 External Infusion Pumps.
The March IFR also stated that face-to-face
exams would not be not required for items that
otherwise require them due to NCD or LCD. This
does not apply to power mobility devices (PMDs),
but telehealth is already allowed to be used to
meet the face-to-face requirements of PMDs.
The rule also ensured that Medicare and
Medicaid regulations are the same in terms of
who can order medical supplies, equipment, and
appliances. And, advance payments With CMS’s April IFR, one section reviewed the CARES Act’s provisions
regarding reimbursement rates rural and other non-bid-area and affirmed it
would extend the 50/50 blended rate for rural suppliers through Dec. 31 or
the end of the COVID-19 public health emergency (PHE), if that lasts longer.
CMS also said it will use the blended rate of 75 percent current adjusted rates
and 25 percent unadjusted rates for suppliers in non-rural, non-bid areas during
that period, as well. Both of those rate structures are retroactive to March 6.
Additionally, CMS stated in the April IFR that it wouldn’t enforce certain
clinical criteria in local coverage determinations governing therapeutic
continuous glucose monitors to give diabetes patients more flexibility to
monitor their glucose and adjust insulin doses at home.
Also, the duration of the COVID-19 PHE, CMS said it is waiving any limitations
on the types of clinical practitioners that can furnish Medicare telehealth
services. This means CMS has broadened its telehealth list to include
both two key clinical partners/staff for HME providers: Physical Therapists
(PTs) and Occupational Therapists (OTs).
But those IFRs weren’t all that CMS did. Citing the COVID-19 pandemic,
CMS also decided in mid-April to remove non-invasive ventilators (NIV) from
Round 2021 of competitive bidding — a policy change AAHomecare and
industry advocates had been fighting for a year to stop.
In March of 2019, CMS announced that part of the changes brought with
Round 2021 would be the addition of NIVs to the round, which immediately
drew industry concern. This was followed by Congressional sign-on
letters calling on CMS to reverse the addition, but CMS essentially turned a
deaf ear to those concerns. This led to the introduction of H.R. 4945, which
called for the removal of NIVs from competitive bidding.
By removing NIVs from Round 2021 of competitive bidding, any Medicare-enrolled
DMEPOS supplier can provide any of the types of ventilators
covered under the Medicare program, including NIVs.
In addition to the COVID-19 pandemic, CMS also said its decision was
due to President Trump’s exercise of the Defense Production Act; the public
concern over access to ventilators; and the NIV product category being new
to competitive bidding.
PRIOR AUTHORIZATION AND AUDITS
Perhaps one of the top relaxed policy guidelines is that signature requirements
have been completed suspended on any document that a supplier
might need a patient to sign, according to Kim Brummett, the vice president
of Regulatory Affairs for AAHomecare. Be that an ABN or a delivery tick, a
signature isn’t necessarily required.
Moreover, prior authorization for HME claims is suspended as well. Right
now, that procedure is entirely voluntary.
“You don’t have to do it,” Brummett says. “You can do it if you’d like to do
it. We have many suppliers that really want to continue getting prior authorization
because it keeps them from being audited in the future.
“And then the other option is the suspending all face-to-face requirements
for any of the policies, except of course for PMD, which is statutory,”
she adds. “But CMS is allowing telehealth and audio-only telehealth to meet
those requirements as well.”
And when it comes to audits, nearly all audits have been temporarily
suspended. That includes TPE audits, RACs, CERT and SMRC audits. The
bottom line is that HHS is placing a whole lot of trust in the industry.
“Really, the only contractor that is not suspected is the UPIC,” Brummett
adds. “And those are trickier to really fight because the theory is that
they are fighting fraud as opposed to just randomly auditing to check on
PROTECTING NEWFOUND CREDIBILITY
Almost as quickly as CMS began relaxing guidelines and Congress
ensured the industry would be able to tap into support funds, many industry
stakeholders started to realize what this meant: lawmakers, program administrators
and regulators were clearly seeing HME as a key component in the nation’s front-line healthcare infrastructure.
“I think it’s elevated the HME industry,” says Mark Kassir, president and
CEO of America’s HealthCare at Home and newly appointed President
(Mid-Atlantic) of Spiro Health. “Now, we hear, ‘You guys have the ventilators
that all these hospitals are needing?’ ‘You can put oxygen on patients in the
home and get them out of the hospital?’”
And while a lot of providers were feeling warm fuzzies over the raised
profile for the industry, some stakeholders were starting to get a shiver
down their spine. Why? That hard-earned clout can go up in a puff of smoke
if gets abused.
To that point, officials from both AAHomecare and VGM Government
Relations released letters to the industry urging providers that with CMS’s
relaxations of various coverage requirements, providers should judiciously
apply the policy guidance and keep a sharp eye out for anyone taking
advantage of the relaxed policies.
A statement from AAHomecare reminded providers that CMS’s relaxations
in coverage criteria were implemented to help HME providers provide
care during challenging conditions, and that providers should follow not
only the “letter of the law” but the “spirit of the law,” to maintain both the
goodwill, and hopefully some of the new guidelines.
Simply put, a lot is riding on how providers conduct themselves under
these relaxed guidelines, according to Gary Sheehan, president and CEO of
Cape Medical Supply and newly appointed CEO of Spiro Health.
“I hope HME continues to represent itself with the level of response and
ethics frankly that they need to,” he says. “And if they do I think coming out
of it will be thought of in a much better light than we have historically.”
And if that favorable impression continues, it could lead to some relaxed
policy guidelines staying relaxed.
Bearing that in mind, one policy change that providers are betting will
stick around is telehealth— so much so that they’re investing in the technology.
Can you blame them? All their referral partners want increased
telehealth usage, and so do their patients. It saves time and money.
“It has not been a lack of willingness for patients or a technology limitation
for physicians,” Sheehan explains. “It’s been the inability of the payer and
regulatory community to step up and take this in the direction it should be
going and given that it’s 2020.”
So when the COVID-19 outbreak started spreading globally, Sheehan said
his business started looking into implementing it.
“We made the decision very early; March 12,” he says. “We made the
decision based on what we were seeing. Then, starting the following
Monday, March 16, we were going to 100 percent remote setup, telehealth
consults prior to setup, and post setup.”
If anything, the push toward telehealth is part of a larger “megatrend” that
is being felt by many sectors of the economy: the need for social distancing
has caused people to reexamine how they conduct business, not just health-related
“I think the entire global economy is going to look substantially different
coming out of this in terms of remote work and work from home,” Sheehan
says, joking, “I’m certainly glad I’m not a commercial real estate executive
right now … . But in terms of HMEs specifically, the regulatory relaxation
that we saw and the speed at which we saw it get adopted, I think spoke to
how ridiculous some of these existing regulations were frankly.”
When it comes to HME, some of the relaxed guidelines will likely stay,
Sheehan explains, while others remain. It’s a give-and-take between what
will make sense after the PHE is quelled and new working methods have
become rooted in place.
“I don’t think prior authorization is gone forever, and I don’t think that all
of Medicare’s relaxed guidelines are going to be left in place,” he says. “I
think the relaxations will be in place for quite a while as this thing comes and
goes — based on what scientists are saying.”
This article originally appeared in the May/June 2020 issue of HME Business.