NAMDRC Update

The old adage of not wanting to see how laws or sausage is made holds true today, perhaps more so than ever. But certain clinical realities within pulmonary medicine virtually ensure that legislation is actually part of any reasonable solution.

NAMDRC has initiated an outreach to all the key medical, allied health, and patient societies that focus on pulmonary medicine to determine if consensus can be reached on a focused laundry list of issues that, for varying reasons, lean toward Congress for legislative solutions.

Here is a list of some of the issues under discussion:

• Home mechanical ventilation. Under current law, “ventilators” are covered items under the durable medical equipment benefit. In the 1990s, in order to circumvent statutory requirements that ventilators be paid under a “frequent and substantial servicing” payment methodology, HCFA (now CMS) created a new category – respiratory assist devices and declared that these devices, despite classification by FDA as ventilators, are not ventilators in reality, and the payment methodology, therefore, does not apply.

Over the past several years, the pulmonary medicine community tried its best to convince CMS that its rules were problematic, archaic, and costing the Medicare program tens of millions of dollars in unnecessary expenditures. A formal submission to CMS, a request for a National Coverage Determination reconsideration, was denied with a phrase now echoed throughout health care, “it’s complicated.” The only effective solution is a legislative one.

• High flow oxygen therapy for ILD patients. Oxygen remains the largest single component of the durable medical equipment benefit and, largely due to competitive bidding, has seen payment drop dramatically since the implementation of competitive bidding.

One can easily argue that competitive pricing is self-inflicted by the DME industry as the rates are set through a complicated formula based on bids from suppliers. But the impact has been particularly hard on liquid systems, the delivery system choice of not only many Medicare beneficiaries but also is the modality of choice for patients with clear need for high flow oxygen. While delivery in the home for high flow needs can be met by some stationary concentrators, the virtual disappearance of liquid systems, attributable to pricing triggered by competitive bidding, results in many ILD patients unable to leave their homes. The only effective solution is a legislative one.

• Section 603. This provision of the Balanced Budget Act of 2015 was designed to inhibit hospital purchases of certain physician practices that were based on aberrations within the Medicare payment system that rewarded hospitals significantly more than the same service provided in a physician office. For example, a physician office-based sleep lab may be able to bill Medicare for a particular service, but if the hospital purchases that physician practice and bills for the same service, it might receive upwards of twice as much payment.

While all involved seem to agree that this provision was not intended to target pulmonary rehabilitation services, it is being hit particularly hard by CMS rules implementing the statute. Any new pulmonary rehab program that is not within 250 yards of the main hospital campus must bill at the physician fee schedule rate, a rate about half of the hospital outpatient rate. Furthermore, existing programs that choose to expand must do so within the confines of their specific current location, unable to move a floor away. Doing so would trigger the reduced payment methodology.
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CMS agrees this is clearly an example of unintended consequences, but CMS also acknowledges it does not have the authority to remedy the situation. The agency itself signaled the only way to exempt pulmonary rehabilitation services is to seek Congressional action.

And now to the “sausage” part of the equation. Congressional action on virtually anything except renaming a post office becomes a political, as well as substantive, challenge. Here are just some of the considerations that must be addressed by any legislative strategy.
 

1. Any “fix” must be clinically sound and supported across a broad cross section of physician and patient groups. And the fix must give some level of flexibility to CMS to implement it in a reasonable way but tie their hands to force changes in policy.

2. Any “fix” must have a strong political strategy that can muster support within key Congressional committees (House Ways & Means Committee and Energy & Commerce Committee, along with the Senate Finance Committee, let alone 218 votes in the House and 51 votes in the Senate.

Given these issues, almost regardless of the political environment, it is time to begin working on substantive solutions so that when the political climate improves, pulmonary medicine is ready to move forward with a coordinated cohesive strategy.

The old adage of not wanting to see how laws or sausage is made holds true today, perhaps more so than ever. But certain clinical realities within pulmonary medicine virtually ensure that legislation is actually part of any reasonable solution.

NAMDRC has initiated an outreach to all the key medical, allied health, and patient societies that focus on pulmonary medicine to determine if consensus can be reached on a focused laundry list of issues that, for varying reasons, lean toward Congress for legislative solutions.

Here is a list of some of the issues under discussion:

• Home mechanical ventilation. Under current law, “ventilators” are covered items under the durable medical equipment benefit. In the 1990s, in order to circumvent statutory requirements that ventilators be paid under a “frequent and substantial servicing” payment methodology, HCFA (now CMS) created a new category – respiratory assist devices and declared that these devices, despite classification by FDA as ventilators, are not ventilators in reality, and the payment methodology, therefore, does not apply.

Over the past several years, the pulmonary medicine community tried its best to convince CMS that its rules were problematic, archaic, and costing the Medicare program tens of millions of dollars in unnecessary expenditures. A formal submission to CMS, a request for a National Coverage Determination reconsideration, was denied with a phrase now echoed throughout health care, “it’s complicated.” The only effective solution is a legislative one.

• High flow oxygen therapy for ILD patients. Oxygen remains the largest single component of the durable medical equipment benefit and, largely due to competitive bidding, has seen payment drop dramatically since the implementation of competitive bidding.

One can easily argue that competitive pricing is self-inflicted by the DME industry as the rates are set through a complicated formula based on bids from suppliers. But the impact has been particularly hard on liquid systems, the delivery system choice of not only many Medicare beneficiaries but also is the modality of choice for patients with clear need for high flow oxygen. While delivery in the home for high flow needs can be met by some stationary concentrators, the virtual disappearance of liquid systems, attributable to pricing triggered by competitive bidding, results in many ILD patients unable to leave their homes. The only effective solution is a legislative one.

• Section 603. This provision of the Balanced Budget Act of 2015 was designed to inhibit hospital purchases of certain physician practices that were based on aberrations within the Medicare payment system that rewarded hospitals significantly more than the same service provided in a physician office. For example, a physician office-based sleep lab may be able to bill Medicare for a particular service, but if the hospital purchases that physician practice and bills for the same service, it might receive upwards of twice as much payment.

While all involved seem to agree that this provision was not intended to target pulmonary rehabilitation services, it is being hit particularly hard by CMS rules implementing the statute. Any new pulmonary rehab program that is not within 250 yards of the main hospital campus must bill at the physician fee schedule rate, a rate about half of the hospital outpatient rate. Furthermore, existing programs that choose to expand must do so within the confines of their specific current location, unable to move a floor away. Doing so would trigger the reduced payment methodology.
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CMS agrees this is clearly an example of unintended consequences, but CMS also acknowledges it does not have the authority to remedy the situation. The agency itself signaled the only way to exempt pulmonary rehabilitation services is to seek Congressional action.

And now to the “sausage” part of the equation. Congressional action on virtually anything except renaming a post office becomes a political, as well as substantive, challenge. Here are just some of the considerations that must be addressed by any legislative strategy.
 

1. Any “fix” must be clinically sound and supported across a broad cross section of physician and patient groups. And the fix must give some level of flexibility to CMS to implement it in a reasonable way but tie their hands to force changes in policy.

2. Any “fix” must have a strong political strategy that can muster support within key Congressional committees (House Ways & Means Committee and Energy & Commerce Committee, along with the Senate Finance Committee, let alone 218 votes in the House and 51 votes in the Senate.

Given these issues, almost regardless of the political environment, it is time to begin working on substantive solutions so that when the political climate improves, pulmonary medicine is ready to move forward with a coordinated cohesive strategy.

The old adage of not wanting to see how laws or sausage is made holds true today, perhaps more so than ever. But certain clinical realities within pulmonary medicine virtually ensure that legislation is actually part of any reasonable solution.

NAMDRC has initiated an outreach to all the key medical, allied health, and patient societies that focus on pulmonary medicine to determine if consensus can be reached on a focused laundry list of issues that, for varying reasons, lean toward Congress for legislative solutions.

Here is a list of some of the issues under discussion:

• Home mechanical ventilation. Under current law, “ventilators” are covered items under the durable medical equipment benefit. In the 1990s, in order to circumvent statutory requirements that ventilators be paid under a “frequent and substantial servicing” payment methodology, HCFA (now CMS) created a new category – respiratory assist devices and declared that these devices, despite classification by FDA as ventilators, are not ventilators in reality, and the payment methodology, therefore, does not apply.

Over the past several years, the pulmonary medicine community tried its best to convince CMS that its rules were problematic, archaic, and costing the Medicare program tens of millions of dollars in unnecessary expenditures. A formal submission to CMS, a request for a National Coverage Determination reconsideration, was denied with a phrase now echoed throughout health care, “it’s complicated.” The only effective solution is a legislative one.

• High flow oxygen therapy for ILD patients. Oxygen remains the largest single component of the durable medical equipment benefit and, largely due to competitive bidding, has seen payment drop dramatically since the implementation of competitive bidding.

One can easily argue that competitive pricing is self-inflicted by the DME industry as the rates are set through a complicated formula based on bids from suppliers. But the impact has been particularly hard on liquid systems, the delivery system choice of not only many Medicare beneficiaries but also is the modality of choice for patients with clear need for high flow oxygen. While delivery in the home for high flow needs can be met by some stationary concentrators, the virtual disappearance of liquid systems, attributable to pricing triggered by competitive bidding, results in many ILD patients unable to leave their homes. The only effective solution is a legislative one.

• Section 603. This provision of the Balanced Budget Act of 2015 was designed to inhibit hospital purchases of certain physician practices that were based on aberrations within the Medicare payment system that rewarded hospitals significantly more than the same service provided in a physician office. For example, a physician office-based sleep lab may be able to bill Medicare for a particular service, but if the hospital purchases that physician practice and bills for the same service, it might receive upwards of twice as much payment.

While all involved seem to agree that this provision was not intended to target pulmonary rehabilitation services, it is being hit particularly hard by CMS rules implementing the statute. Any new pulmonary rehab program that is not within 250 yards of the main hospital campus must bill at the physician fee schedule rate, a rate about half of the hospital outpatient rate. Furthermore, existing programs that choose to expand must do so within the confines of their specific current location, unable to move a floor away. Doing so would trigger the reduced payment methodology.
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CMS agrees this is clearly an example of unintended consequences, but CMS also acknowledges it does not have the authority to remedy the situation. The agency itself signaled the only way to exempt pulmonary rehabilitation services is to seek Congressional action.

And now to the “sausage” part of the equation. Congressional action on virtually anything except renaming a post office becomes a political, as well as substantive, challenge. Here are just some of the considerations that must be addressed by any legislative strategy.
 

1. Any “fix” must be clinically sound and supported across a broad cross section of physician and patient groups. And the fix must give some level of flexibility to CMS to implement it in a reasonable way but tie their hands to force changes in policy.

2. Any “fix” must have a strong political strategy that can muster support within key Congressional committees (House Ways & Means Committee and Energy & Commerce Committee, along with the Senate Finance Committee, let alone 218 votes in the House and 51 votes in the Senate.

Given these issues, almost regardless of the political environment, it is time to begin working on substantive solutions so that when the political climate improves, pulmonary medicine is ready to move forward with a coordinated cohesive strategy.