On Dec. 21, Congress has passed a $900 billion COVID-19 relief package that included a permanent fix for rural oxygen reimbursement, and extended the pause on 2 percent sequestration cuts for three more months.
Where oxygen reimbursement is concerned, that provision represented the culmination of a four-year industry advocacy and legislative effort, Tom Ryan, the president and CEO of the American Association for Homecare reflected in a public statement this week.
The Dec. 21 COVID-19 relief bill included provisions that fix a Medicare reimbursement disparity for oxygen items provided in rural areas due to the application of outdated budget neutrality provisions from the 1997 Balanced Budget Act.
Recent legislative and regulatory actions helped reduce the unequal reimbursement by temporarily applying a 50/50 blended rate for oxygen (and other DMEPOS items) in rural areas. The newly passed relief package makes that fix permanent.
Four years ago, on Dec. 21, 2016, the lead story of AAHomecare’s Wednesday in Washington newsletter discussed the cuts, and included comments developed by AAHomecare’s Regulatory Council pushing back against the double-dip cuts for rural oxygen. Thus began the effort to fix the cuts.
“These were the first of multiple occasions that AAHomecare went on record to oppose this poorly conceived policy, including multiple rounds of comments on CMS Proposed Rules and Interim Final Rules, as well as responses to House Ways and Means Committee Requests for Information on Medicare policy in 2017 and 2019,” Ryan wrote. “Our comments and conversations with CMS and HHS officials met with a familiar reply: the policy could not be fixed by regulatory action; only Congress had the power to cure the issue.”
In 2017, budget neutrality provisions were included in H.R. 4229, which also sought to limit Medicare reimbursement cuts for suppliers outside of competitive bidding areas. While that didn’t pass, similar provisions were added to H.R. 2771 in the next Congress.
In September of 2020, H.R. 8158 focused specifically on the budget neutrality fix, gained approval by the House Energy & Commerce Committee and its provisions were finally included in the COVID-19 bill. The fix will add $650 million into rural oxygen suppliers’ bottom lines over the next 10 years, according to a Congressional Budget Office estimate.
“This win for rural oxygen suppliers and the communities they serve is another demonstration of what it takes to win on public policy issues: your broad participation and persistence. It’s taken highly detailed work developing analyses and comments, hundreds of in-person Capitol Hill meetings by AAHomecare staff and HME stakeholders, thousands of calls and emails to ask for support and co-sponsors, plus years of district meetings and site visits with your legislators,” Ryan wrote. “All of these have been needed to build credibility for our industry and grow awareness of your role in supporting millions of patients, families and caregivers — and ultimately, to chalk up another win for HME.”
