WASHINGTON – A new coalition led by a long-time industry healthcare attorney and former White House and Health and Human Services (HHS) advisers has made audit relief its singular priority.
The Medicare Appeals Due Process Coalition will work on behalf of HME providers to reform the appeals process for audited and denied claims.
“It’s important to get different types of providers together and raise their voice with CMS and Congress to see if we can get this fixed,” said Jennifer Summa, a senior policy adviser for Baker Donelson and a former senior adviser to CMS Deputy and Acting Administrator Leslie Norwalk. “You need to have numbers to be heard.”
Summa is joined by Stephen Azia, counsel at Baker Donelson; Lance Leggitt, chairman of the firm’s Health Care Government Affairs Practice Group and a former senior health policy advisor to George W. Bush; and Nancy Johnson, a former member of Congress and chairwoman of the Ways and Means Health Subcommittee.
The coalition has two goals. The first: Work with CMS to find a way to expedite the appeals process. By law, an ALJ must conduct a hearing within 90 days, but the Office of Medicare Hearings and Appeals (OMHA) announced recently that it would defer assignment to the ALJs up to 28 months.
“There has become a feeding frenzy in terms of audits and denials, and it has jammed the system,” said Leggitt. “CMS is letting the appeals system determine what’s a valid claim and what’s fraud, and because a small percentage is fraud, it’s not the most efficient way of doing it. The process needs to be more qualitative.”
The second goal: Work with Congress to get statutory language enacted that would prevent CMS from making any recoupments until a provider has gone through the ALJ level—at minimum. That’s key because the first two levels of appeals are more administrative and don’t involve a hearing, and because 56% of the time the ALJ reverses the decision of the previous level.
“No provider should have to wait two years for an appeal, while money is being taken away,” Azia said. “We’ve seen, because of extrapolation, where 30, 40, or 50 claims representing $20,000 become $2.5 million. It really becomes threatening to the existence of any provider.”
Since Leggitt, along with Summa, was part of a small group of advisors that oversaw the establishment of OMHA, he knows how broken the system has become.
“Congress has been very reactive when engaged on this,” he said. “We need to say, ‘Look, you made changes a decade ago and the problems are getting worse.’”
LAKE FOREST, Calif. – Apria Healthcare has already felt the sting of the Round 2 bid rates, company officials said during an earnings call Nov. 12.
Apria reported net revenues of $607.2 million for the third quarter ended Sept. 30, 2013, a decrease of $1.3 million from the same quarter last year. Net loss was $15.8 million.
“Almost the entire decrease is due to the competitive bidding cuts that were effective July 1, 2013,” said CEO John Figueroa.
Apria accepted 371 contracts under Round 2 of competitive bidding. The company has also accepted contracts in the Round 1 re-compete, including Coram’s contracts for home infusion in all nine bid areas.
Despite the financial hit to the company, Apria expects “minimal” disruption to patients, payers and referral sources, said Figueroa.
Revenues for Apria’s respiratory therapy/home medical equipment division were $278.1 million for the third quarter, a decrease of $23.1 million compared to the same quarter last year. Those losses were offset by continued gains in Apria’s Coram home infusion division. Revenues for that division were $975.3 million for the third quarter, an increase of $68.9 million compared to the same quarter in 2012.
Home infusion accounts for about 53% of Apria’s overall revenues and should continue to grow, said Figueroa.
“There are a number of interesting infused drugs in the FDA pipeline that have us very excited about the growth prospects in the infusion segment,” he said. “Because of our strong relationships with drug manufacturers, we are well prepared to participate in those launches.”
Apria reported net revenues of $1.8 billion for the first nine months of the year, an increase of $30.7 million compared to the same period last year. Net loss was $53.8 million.
YARMOUTH, Maine – A number of mobility providers that were not offered contracts for standard power have bolstered their existing complex rehab businesses as a way to stay afloat in the wake of Round 2.
The transition means making big changes, they say.
“We’re down 12 employees since April or May—we’re a different company now, and we may have to make more changes,” said Mark Armstrong, president of Glen Allen, Va.-based Trustcare Home Medical Equipment, who declined the contracts he was offered. “We’re pulling in new business in new metropolitan areas of Virginia. You can’t give up.”
With four assistive technology professionals (ATPs) reaching out to referrals in those new areas, Armstrong has been able to minimize the hit on his business. He’s also selling his inventory of used wheelchairs and beds.
“If I can get 30% on the dollar, I’m taking it,” he said. “I don’t want to sit on this inventory.”
Provider Patrick Mahncke says big changes at his company include re-training employees who used to deliver HME to repair complex rehab equipment.
“They’ve taken courses from U.S. Rehab,” said Mahncke, president of Denver, Colo.-based USA Mobility. “Now they’re working with our existing service department, doing an apprenticeship to get the hang of it.”
Providers say the key to increasing complex rehab business is forming strategic relationships with referral sources. Provider Doug Westerdahl has partnered with The Comfort Company to host a series of seminars tailor made for that audience with Swedish physiotherapist Bengt Engström. Clinicians had the chance to earn CEUs and meet the renowned seating and positioning expert.
“It was very well-received,” said Westerdahl, president of Rochester, N.Y.-based Monroe Wheelchair. “It was a service on our part to provide the CEUs, and allowed us to market ourselves to potential referral sources.”
Westerdahl says his complex rehab business is doing better than expected.
“Maybe companies that won bids are focusing on meeting the needs of those patients, rather than complex rehab,” he said.
WASHINGTON – A meeting with CMS and congressional staff on DME competitive bidding, originally cancelled due to the government shutdown, has been set for 11 a.m., Monday, Nov. 18, says The VGM Group. Because the briefings, for staff of the Energy and Commerce and Ways and Means committees, will not be public, VGM and AAHomecare are calling on providers to contact their members of Congress to urge them to attend.
Employees return to Invacare facility
ELYRIA, Ohio – A “small number” of employees are returning to Invacare’s Taylor Street facility, according to a story by the Chronicle-Telegram. Per a consent decree put in place by the U.S. Food and Drug Administration (FDA) in December 2012, the company limited design, manufacturing and distribution activities at the plant, resulting in the layoff of 236 employees. Returning employees are being placed throughout the facility, according to the story. “It’s a small number, but I know it is a goal to return to full capacity at the facility,” Lara Mahoney, spokeswoman, told the newspaper. “Is this good news? Yes, it is, but we still have a ways to go.” Invacare has submitted and passed two of the three audits required to lift the decree. It expects to submit the third audit in November.
KCI’s third quarter revenues slip
SAN ANTONIO, Texas – Kinetic Concepts Inc. (KCI) has reported a drop in third-quarter revenues: $320.9 million in 2013 vs. $329.7 million in 2012, a 2.7% decrease. The company said the decline stems from Round 2 of competitive bidding. KCI products that fall under the program’s umbrella saw a 42% price reduction. “KCI would have reported positive revenue growth in the third quarter, exclusive of this one item,” stated CFO Robert Hureau.
One in 10 will have diabetes by 2035, report says
BRUSSELS, Belgium – One-tenth of the world’s population—592 million people—will have diabetes by 2035, according to the sixth Diabetes Atlas, released by the International Diabetes Federation Nov. 14. The federation says 382 million people will have the disease by the end of 2013. Most people with diabetes are between 40 and 59 years old and live in low- and middle-income countries, according to the report. “Diabetes is a disease of development,” said Michael Hirst, IDF president, in a statement. “The misconception that diabetes is ‘a disease of the wealthy’ is still held, to the detriment of desperately needed funding to combat the pandemic.” About 9.2% of Americans will have developed some form of diabetes by the end of 2013, the report says. That figure should increase to 11.6% by 2035.
My Home Medical Care debuts online
ALPINE, Utah – A new website, MyHomeMedicalCare.com, has launched, offering a variety of supplies for home medical care, according to a Nov. 14 news release. Founder Daniel Wang’s work as an X-ray technician in private homes and nursing facilities helped him become familiar with the needs of patients receiving health care at home, according to the release. Products for sale on the site include mobility aides, such as walkers and canes; incontinence products; and blood-pressure monitors. MyHomeMedicalCare.com is a division of DJW Enterprises.
Provider collects scrubs for drive
ASHLAND, Ky. – King’s Daughters Home Medical Equipment and The Dressing Room are collecting new and gently used scrubs to donate to students, graduates and those entering the medical field. The drive is open until Dec. 31 and medical professionals who donate scrubs will be given a 10% discount off purchases at King’s Daughters HME. “Uniforms can be a major expense for anyone starting a job, in any field,” said Jamie Martinez, director of King’s Daughters. “But, if you’re a new grad, or someone who has just finished re-training after months of unemployment, the cost of uniforms can be a real obstacle.”
MDA names Numotion Company of the Year
HARTFORD, Conn. – The Muscular Distrophy Association (MDA) has named Numotion the 2013 Company of the Year, the company announced Nov. 11. MDA presented Numotion with the award during the 16th annual Connecticut area Black and Blue Ball in October, according to the release. The organization honored Numotion for supporting the ball, helping with mobility loan closets and volunteering at summer camps. “Numotion is excited to continue its support of the MDA,” stated Mark Miller, Numotion vice president of marketing and strategic partnerships, in the release. “Our team is geared up to be involved and support many MDA events across the country, including Muscle Walks and summer camps, in 2014.”
Company seeks crowdfunding support for sleep apnea device
BURLINGAME, Calif. – California company Lucky Knives is using Indiegogo to raise money to tool and win FDA approval for SpeakEasy, a product that it has developed to help patients talk while using CPAP devices. To use SpeakEasy, the wearer pinches two rubber buttons. “Now, it’s easy to say goodnight to your spouse, answer the phone and sneeze without having to take off the mask or reset the machine,” stated Hal Rucker, company president, in a release.
CMS clarifies “homebound”
BALTIMORE – Medicare beneficiaries must now meet two sets of criteria to be considered “homebound,” according to new rules that take effect Nov. 19. First, they must need supportive devices, special transportation or other help to leave the home. Second, they must be unable to leave the home, or leaving the home must take “a considerable and taxing effort.” CMS says its new definition will prevent confusion, lead to clearer enforcement and offer more definitive guidance to home health agencies.
Studies: V.A.C. VeraFlo speeds wound healing
SAN ANTONIO, Texas – Studies presented at two recent conferences show Kinetic Concepts’ V.A.C. VeraFlo Installation Therapy reduces the length of hospital stays, speeds wound closure and reduces debridement costs when compared to traditional V.A.C. therapy, the company announced Nov. 11. “This is one of those things that comes along every decade or so that literally radically changes the way you treat your patients,” stated study presenter Paul Kim, associate professor and research director at Georgetown University School of Medicine Center for Wound Healing, in the release.
Alliqua lands $1M to ramp up wound care biz
LANGHORNE, Pa. – Alliqua has obtained $1 million in financing from Crossover Healthcare Fund to fund key initiatives in the wound care space, the company announced Nov. 12. The biopharmaceutical company will put the money toward sales and marketing of hydrogel products sold under the SilverSeal brand, and its sorbion sachet S and sorbion Sana wound-care products. The financing is in the form of 250,000 shares of Series A Preferred Stock, which can be converted into 11,111,111 shares of common stock. Alliqua must redeem the stock on Oct. 21, 2015, according to the release.
HomeCare app speeds reporting
ORLANDO - HomeCare Connect has a new app that helps providers quickly and accurately complete paperwork for workers’ compensation payers. Synchronizing with the company’s servers, the app allows providers to start case reviews and applications while they’re still with patients, according to the company. “Payers can receive same-day reports if desired,” stated Vonesa Wenzel, CMO of HomeCare Connect, in a release. The system provides a portal for real-time updates, document downloads and electronic authorizations, as well. Clinical care coordinators help ensure reports are complete and accurate before they are sent to payers, according to the company. HomeCare Connect focuses on managing the quality and cost of home health, durable medical equipment and supplies for workers’ compensation payers.
SMP Home Medical donates to OT program
DUBOIS, Pa. – SMP Home Medical has donated a wheelchair and a trapeze lift to the Penn State DuBois Occupational Therapy Assistant Program, the company announced Nov. 10. “With updated equipment, our students will get to practice with the most up-to-date items that are out there, and it really improves their educational experience,” stated LuAnn Demo, instructor and OTA campus coordinator, in the release. SMP also hosts the OTA students at a yearly open house, showing them the latest home medical equipment.
Wayne, N.J.-based Maddak’s Morph Wheels, folding wheelchair wheels, won Popular Science’s 2013 Best of What’s New award in the health field for innovation and advancement of functionality, the company announced recently…Onehealth & OneSource and its Diabetic 360 program will be the exclusive provider of diabetic supplies and education to clients of HMC Healthworks, a Florida-based provider of health management and wellness programs, the company announced Nov. 14 … Atlanta-based Patientco is the Metro Atlanta Chamber’s 2013 Healthcare IT Start-Up Company of The Year, according to a Nov. 13 news release…Lee Meagher, founder and CEO of Winnipeg, Manitoba-based Scootaround, Inc., was named one of Canada’s top 100 female entrepreneurs by Profit Magazine and Chatelaine. Scootaround rents wheelchairs and scooters to traveling customers, event attendees and business travelers.
WASHINGTON – HME providers in the competitive bidding program may no longer decline referrals after reaching their financial capacity, according to AAHomecare.
In a recent bulletin, the association said it has received clarification from the Competitive Bidding Implementation Contractor (CBIC) that this is no longer acceptable.
“AAHomecare has had several discussions with the CBIC expressing that financial capacity is a real issue with potentially devastating impact,” the bulletin reads. “With the number of contracts awarded to companies hundreds of miles outside of bidding areas, local providers are overwhelmed with requests.”
The official guidance from the CBIC includes: Providers must furnish all items in the product categories and bid areas for which they have contracts, or risk having those contracts terminated. Additionally, providers are not permitted to “pick and choose” beneficiaries.
CMS says it examines the financial capacities of providers as part of the bidding process to make sure it awards enough contracts to meet demand.
AAHomecare says it will continue to discuss this issue with the CBIC.
LAKE FOREST, Calif. – Apria Healthcare on Nov. 12 reported net revenues of $607.2 million for the three months ended Sept. 30, 2013, a decrease of $1.3 million from the same period last year.
The company attributed the decline primarily to Round 2 of competitive bidding, which began on July 1, 2013, and decreased volume in the respiratory and home medical equipment segment of the business.
Net loss for the three months ended Sept. 30, 2013, was $(15.8) million.
Apria reported net revenues of $1.8 billion for the year to date, an increase of $30.7 million compared to the same period last year. The increase is due primarily to increased volume in the provider’s home infusion segment, which saw a 7.6% increase in net revenues.
JACKSON, Mich. – RemZzzs may not have given up on restoring Medicare coverage for its CPAP mask liners, but the company, in at least one way, has moved on.
Rewind to March 2013. That’s when a Medicare contractor notified RemZzzs that, in consultation with the four medical directors, it had re-assigned the liners to a non-covered code (A9270). The reason: The contractor stated the liners were a comfort product and “duplicative of what is already provided on the mask.” It also stated they lacked peer review.
Bob Rutan, CEO of RemZzzs, has been fighting the decision to no longer cover the liners under A7031 and A7032, but so far to no avail.
“We’ve spent $10,000 trying to find a way out of this,” he said. “More than 2,000 customers have written to us and asked us why Medicare is doing this. We sent a five-pound box of testimonials and other documentation to the contractor. It just doesn’t seem fair.”
It seems even less fair because other comfort products by other manufacturers are still covered under the two codes, Rutan points out.
RemZzzs has taken a 40% hit in sales due to the contractor’s decision, Rutan says.
“It puts us back to where we were three years ago when we didn’t have the codes to begin with,” he said.
Fast forward to October. After hearing horror stories while on his “Dreams With Hope” tour to raise awareness of sleep therapy, Rutan started to promote the liners to the respiratory departments of hospitals. Mask use in hospitals can often mean a lot of wrenching down on a patient’s face to prevent leaks, which can often mean, at best, rashes and, at worst, a hole in a nose, he says.
“In one hospital, when they come in with the liners, the patients chant, ‘RemZzzs, RemZzzs,’” he said. “That’s how well they work. We’re pretty encouraged we can be a big voice in the hospital market, and it’s bigger than the sleep market.”
Still, Rutan hates knowing there are people out there who want and need his product to comply with their sleep therapy at home, and who just can’t get it.
“If one good thing happened from the code being gone, it’s that it moved us into another area,” he said. “But I’m still upset, because they’re suffering without it.”
Attempts to reach the medical directors for this story were unsuccessful.
WASHINGTON – CMS has set a new start date for denying DME claims with the names of physicians who are not enrolled in PECOS and, this time, it may stick, industry stakeholders say.
Starting on Jan. 6, 2014, claims with the names of physicians who are not enrolled in PECOS will be denied, and the provider who submitted the claims will not be paid for the items or services that were furnished. Most recently, CMS had planned to start denying claims on May 1, 2013.
“It feels real this time,” said Kim Brummett, senior director of regulatory affairs for AAHomecare. “This has been a long, long time coming.”
This phase of the implementation of PECOS goes back to 2009. That’s when CMS started sending providers this informational message when they billed with physicians not enrolled in PECOS: “Although this was paid, you have billed with a referring/ordering provider that does not match our system record. Unless corrected, this will not be paid in the future.” The messages came in as N544.
Although there have been software glitches along the way that have prevented CMS from enforcing the edits, the biggest reason for the delays: Physicians just weren’t enrolling in PECOS, stakeholders say.
“They finally forced the physicians who weren’t enrolled by making them not eligible for increases in payments associated with electronic medical record adoption and by suspending their billing privileges,” Andrea Stark said. “That was the final push.”
That, combined with proactive providers scrubbing their databases to make sure their information matches CMS’s information, has significantly reduced the number of informational messages sent out, stakeholders say.
“We’ve seen a major reduction,” Stark said.
Despite the advancements, there are still several gray areas with PECOS that stakeholders are trying to get addressed. For example: Can a provider use an advanced beneficiary notice (ABN) if a physician chooses not to enroll, retires or passes away?
“What happens if a provider takes an order from a physician, delivers equipment and doesn’t realize the physician is not enrolled?” Brummett said. “Can the provider hold the claim until the physician is enrolled? These things are still up in the air.”
Stakeholders say providers should take Jan. 6 very, very seriously.
“We’ve worried about it so many times, but it keeps getting delayed, so it’s hard for anyone to take it seriously,” said Kelly Wolfe, CEO of Regency Billing and Consulting. “That needs to change.”
WASHINGTON – It’s still early, but industry stakeholders are already hearing reports of licensure issues in the Round 1 re-compete.
This time, however, it’s licensed providers that say their bids were rejected because, according to the Competitive Bidding Implementation Contractor (CBIC), they were not properly licensed.
“We’ve just begun licensure analysis, but CMS seems to be making the same kind of mistakes,” said Cara Bachenheimer, senior vice president of government relations for Invacare. “And it’s only nine bid areas.”
In Round 2, CMS awarded hundreds of contracts to suppliers that didn’t meet licensure requirements.
One provider in Round 1 received only one contract offer in the re-compete. In an email to HME News, the provider wrote:
“We were absolutely stunned to learn that our bids were rejected because, according to the CBIC, we are not licensed in the state in that product category. Please bear in mind that we are and have continually been licensed in North Carolina to provide medical equipment.”
Adding insult to injury, out-of-state companies that do not meet local licensure requirements received contract offers, the provider wrote.
Even as stakeholders parse new re-compete information, they continue to lobby for H.R. 1717, a bill that would replace the competitive bidding program with the market-pricing program (MPP). The bill has 157 co-sponsors in what’s becoming a dwindling congressional session.
AAHomecare is working with People For Quality Care to get stories of the impact on beneficiaries in front of the public. The association’s president, Tom Ryan, acknowledges that providers are battle weary.
“I know everybody is going about trying to survive under these new price constraints,” he said. “It’s going to take a Herculean effort to get the story out there but we’ve got to continue to engage.”
CORAL SPRINGS, Fla. – Arriva Medical may have finally arrived at the top of the heap in the mail-order market for diabetes supplies.
The provider, a contract supplier for Medicare’s national mail-order program, has acquired Nashville-based Simplex Healthcare, the parent company of Diabetes Care Club, also a contract supplier.
“They’ve been on a buying binge over the past two years and they are doing a great job of scaling their business,” said Jonathan Sadock, managing partner/CEO of Paragon Ventures.
Binge, indeed. Since early 2012, Arriva has bought Direct Diabetic Source, AmMed Direct, and the diabetes supply businesses of NationsHealth and Liberty Medical.
With reimbursement for mail-order diabetes supplies slashed, on average, 72%, as part of competitive bidding, buying is the only way to grow, say analysts.
“When you take that much of a reimbursement hit, revenue declines substantially,” said Patrick Clifford, managing director at The Braff Group. “Scale matters. You have to make acquisitions—you can’t do it bringing on new patients one at a time.”
Until now, Simplex seemed to be positioning itself for growth in the mail-order market. After failing to secure a contract, it acquired contract supplier Priority Diabetes Supply in June. In September, it inked a deal with Neurometrix to distribute its pain management system geared toward diabetes patients.
Liberty Medical was the No. 1 Medicare provider of diabetes supplies in 2012, receiving more than $150.5 million in reimbursement; Arriva was No. 2, with nearly $43 million; and Diabetes Care Club was No. 5, with nearly $31 million, according to the HME Databank.
WASHINGTON – It’s ironic that Wayne Stanfield feels comfortable retiring now that NAIMES is part of AAHomecare.
After all, NAIMES was created in 2007 to meet the needs of the smaller and independent providers that felt neglected by the industry’s largest association.
But the AAHomecare of today isn’t the AAHomecare of six years ago—and that’s a good thing, says Stanfield, who was on staff there from April, when NAIMES merged with the association, until Nov. 15, when he retires.
“With Tom Ryan taking the reins, with Robert Steedley as chairman, and with Kim Brummett and Rob Brant on staff, I think AAHomecare will be a completely different organization and a much better organization,” he said. “I can step away knowing that the best interests of all members are being taking care of.”
Here’s what Stanfield had to say about why he still has faith in the industry that he has been a part of, in various roles, since 1987.
HME News: Did you ever think that groups like NAIMES and AMEPA would be folded into AAHomecare?
Wayne Stanfield: The fractures in the industry occurred partly because there was a need not being met. That may have been perceived, but perception is reality. I used to say that AAHomecare was in a boat and NAIMES was in a boat, and we were rolling in the same direction but in different boats. Now we’re all in the same boat going in the same direction. Unity is critical, and I think that’s going to continue and get stronger.
HME: Where do you think you’ve left a mark on the industry?
Stanfield: I helped a lot of people get involved in politics and understand that politicians don’t bite. You need to be someone they recognize. Having that relationship wins battles. It’s difficult for a member of Congress, when he calls you Wayne and you call him Robert, to say he can’t support something. I’ve had them tell me, “I can’t, because…” but they’ve never blown me off. They’ve always talked to me.
HME: What’s the biggest lesson you’ve learned about the industry?
Stanfield: This industry is made up of good, honest, hard-working people who have the best interest of their patients at heart. We’re not made up of crooks, scammers and people cutting corners. I’ve always hated how we’ve been painted with these broad brushes when it’s a miniscule number of companies that have caused us to have such a bad name.
HME: You’re still part of the industry as a co-owner of an HME company in Virginia and as the executive director of the Home Care Alliance of Virginia. What’s the future hold for the industry?
Stanfield: It is my hope that we can change the path of where DME is going, but it has been profoundly affected by competitive bidding, and it will take a tremendous and concerted effort by everyone in the industry to get it resolved. There’ll always be a need for DME; the only thing that is going to change is who provides it and how it’s paid for. DME, as a whole, is not going to get smaller. Providers need to learn how to adapt. Bidding will change. It has to.
INDIANAPOLIS – Prior authorization requests submitted as part of the PMD demo are being denied because of conflicting information in face-to-face exams and other medical records, and insufficient face-to-face exam information, National Government Services (NGS) announced in a recent bulletin. The list of reasons covers denials as of Oct. 24. NGS says face-to-face exams often do not specify: how a PMD will sufficiently improve the beneficiary’s daily life; what are the beneficiary’s mobility limitations (his or her ability to get into and out of a PMD); what is the beneficiary’s mental or physical ability to operate the device; or what is beneficiary’s ability to stay stable while using the device. Other face-to-face exams neglect to include the beneficiary’s weight, NGS says.
TiLite announces new rep agreements
PASCO, Wash. – TiLite, a manufacturer of titanium and aluminum wheelchairs, has announced new U.S. sales representation agreements that will take effect Dec. 1. Permobil will represent TiLite in Florida and Puerto Rico; The Roho Group will represent the company in Illinois and most of Wisconsin; and Target Medical will represent it in Tennessee and Mississippi, according to the Oct. 30 news release. “We are excited to extend our partnerships with these top players in our industry,” stated TiLite CEO David Lippes in the release. MSL Associates will continue to serve these areas until Nov. 30, according to the release.
Conference news from Medtrade Spring, NCART
Early bird rates for Medtrade Spring start Nov. 12 and stay in effect through 2013. Medtrade Spring takes place March 10-12 at the Mandalay Bay Convention Center in Las Vegas. FMI: www.medtradespring.com ... The second annual National CRT Leadership and Advocacy Conference will take place April 29-May 1, 2014, at the Hyatt Regency Crystal City in Arlington, Va. Contact NRRTS or NCART for more details.
Alpine branches out into Idaho
SALT LAKE CITY - Alpine Home Medical Equipment is expanding into Idaho with the acquisition of Eagle Rock Oxygen and Medical Equipment in Idaho Falls, the company announced Nov. 4. Alpine says Eagle Rock’s staff will continue to serve patients from the same location. In business since 1997, Alpine Home Medical has nine branches in Utah.
AxelaCare acquires SCP Specialty Infusion
LENEXA, Kan. – AxelaCare Health Solutions, a specialty home infusion services provider, has acquired SCP Specialty Infusion, the parent company of Sirona Infusion, which provides acute home infusion, the company announced Nov. 5. The buy doubles AxelaCare’s number of pharmacies, according to a release. “We are excited that Chris (York), an industry leader in home infusion, and his team at Sirona are joining us to build a ‘best in class’ home infusion company,” stated Ted Kramm, AxelaCare CEO, in the release. “Their strength in acute infusion, great geographic coverage in the west and growth profile complements our strengths in IVIg and chronic care, and also expands our platform to provide innovative patient outcomes technology.”
Carex acquires ThermiPaq
NORWELL, Mass. – Carex Health Brands has acquired the ThermiPaq Hot & Cold Therapy brand and other assets from the Springfield, Ill.-based Thermionics Corp., according to a Nov. 4 news release. Carex offers hot/cold pain therapy, including the Bed Buddy moist heat ThermaTherapy and TheraMed brands, and home medical equipment. “This acquisition further solidifies our leadership in the market and allows Carex to improve service to our existing customers through an expanded hot/cold portfolio,” stated Matt McElduff, president of Carex Health Brands, in the release.
Insulet posts third quarter results
BEDFORD, Mass. – Insulet’s revenues reached $61.1 million in the third quarter compared to $54.8 million during the same period last year, a 12% increase, the company announced Nov. 7. The medical device company’s gross profit for the period was $27.4 million, also a 12% increase. Insulet’s revenues in the first nine months of the year were $178.6 million vs. $153.5 million for the same period last year, while gross profit was $79.4 million vs. $67 million. Increased operating expenses were due to the settlement of a patent-infringement dispute with Medtronic involving Insulet’s OmniPod.
Hasco launches new TV ad campaign
ADDISON, Texas – Hasco has begun airing new TV ads in central Florida, hoping to raise awareness of the wheelchair-accessible transportation options that are available to a growing baby-boom population, the company announced Nov. 8. “This will help them make better-informed decisions as their needs change,” stated Hal Compton, Hasco Medical CEO, in a release. “We also expect this to help increase our fourth quarter sales and trade-ins on modified vehicles.” Similar commercials will soon air in other areas served by Hasco’s Ride-Away stores, like Tampa, Fla., and Washington, D.C.
ARI acquires Duo Web Solutions
MILWAUKEE – ARI Network Services, a website, software and data solutions provider, has acquired Duo Web Solutions, a social media and online marketing services provider, the company announced Nov. 5. “This acquisition is in direct alignment with our strategy to grow the digital marketing services side of the business,” stated Roy Oliver, ARI president and CEO, in a release. “Duo Web Solutions’ proven social media services, including reputation management and SEM services, will now be available to dealers, distributors and manufacturers in all the verticals we serve.” Terms of the deal were not disclosed.
Involve community pharmacists in COPD care, study says
OXFORD, England - COPD patients working with community pharmacists stick with their medications and have improved inhalation techniques, a recent study published in the British Journal of Clinical Pharmacology suggests. Patients in the study’s intervention group learned about their disease, medication and how to use inhalers. They also discussed disease management, quitting smoking and adherence. “This trial should encourage community pharmacists to engage in COPD care aiming to sustain an effective and safe pharmacotherapeutic treatment in patients with COPD,” study authors wrote. While patients working with pharmacists stuck with their medication and improved inhalation techniques, investigators did not find that they decreased their moderate exacerbation rate, dyspnea or smoking habits.
CMS has approved the Accreditation Commission for Health Care for continued recognition as a national accrediting organization for hospices that wish to participate in Medicare or Medicaid. ACHC’s recognized status will last through Nov. 27, 2019…November is COPD Awareness Month and Inogen is offering a $500 discount shopping card to the winner of its “Share for COPD Awareness Giveaway,” it announced Nov. 7. To enter, the oxygen therapy company asks people to share their success stories about living with COPD... Ottobock debuted the film “Limitless” at the ReelAbilities Disabilities Film Festival on Nov. 3. “Limitless” is an original film featuring Ottobock employee Leslie Pitt Schneider, who lost a limb early in her life…It’s been 45 years since Al Thieme invented the Amigo power operated vehicle or scooter in his Bridgeport, Mich., garage. “The reason for starting Amigo Mobility was to ‘find a better way’ for a family member to stay active,” said Theime, in an Amigo Friendly Wheels newsletter in November. The company has expanded to a 55,000-square-foot facility and has manufactured more than 222,000 Amigo scooters.
John Dudash, president and CEO of MITY Enterprises, will take the helm of Broda Seating, the company announced Nov. 6. MITY is the parent company of Broda Seating, and was acquired by Prospect Capital Corporation in September…Scot Dube is now president and CEO of Sigvaris North America. Dube succeeds Charles Handschin, who retired from Sigvaris after serving more than 14 years as president and CEO.
BALTIMORE – CMS will start editing DME claims to determine whether or not the ordering or referring physician has enrolled in the Provider Enrollment, Chain and Ownership System (PECOS) on Jan. 6, 2014, according to a new bulletin.
Claims that don’t pass muster will be denied, and the billing provider will not be paid for the items or services that were furnished based on the order or referral.
Physicians and other professionals who order and refer items and services must establish a record in PECOS and a valid national provider identifier (NPI), CMS says.
If a claim identifies the ordering or referring provider but does not include a matching NPI, the claim will still be rejected, the agency says.
The edits will verify provider enrollment by comparing the first four letters of the last name. CMS cautions providers to leave out middle names or initials and suffixes.
INDIANAPOLIS – After pulling back from TV advertising about four years ago, Home Health Depot is once again on the local airwaves.
And this time around, it has help from former Indy racecar driver Sam Schmidt. Schmidt, who was paralyzed in a crash, is featured in the ads.
“He’s a well-known guy in Indiana,” said Nathan Feltman, president. “He’s a current team owner for the Indy 500, so he’s often on the news.”
The 30-second ads, which started airing in October, help drive traffic to Home Health Depot’s five main retail locations in Indiana, including two in Indianapolis.
The ads air on local NBC affiliates, and on cable channels like Fox News, The Weather Channel, and Home and Garden TV.
“We targeted more affluent areas with the cable ads and we targeted the potential users themselves and then also caregivers,” said Feltman.
The ads highlight stair lifts and lift chairs—higher ticket items that are typically paid for out of pocket.
“We didn’t win any competitive bidding contracts, so our stores are going to be hit,” said Feltman.
Feltman says it takes three to six months to assess the return on investment of TV advertising, which he acknowledges is “not cheap.” Home Health Depot has a dedicated phone line associated with the ads to help it track the success of the campaign.
“In the past, we’ve found it to be a decent rate of return,” he said.
PORT WASHINGTON, N.Y. – A recently announced $115 million loan from GE Capital, Healthcare Financial Services, puts Drive Medical in a position to make “game-changing acquisitions,” says Doug Francis, principal and co-founder.
“We have representation in just about every product category, but this will catapult us into product categories that we’re not perceived to be the strongest in today,” he said. “We recognize the need to offer a deeper product mix, so providers can consolidate their purchases. This allows us to put energy behind that.”
Drive has already made one acquisition this year: Mason Medical in April. Mason manufactures pressure prevention products, including alternative pressure and lateral rotation air mattresses, and gel overlays.
Drive will also use the loan to refinance existing debt.
“It’s a combination of the interest rates are low, so it’s a good opportunity to refinance, and it gives us the dry powder to do some things we’ve wanted to do,” said Richard Kolodny, president.
While Drive officials were limited in what they could say about any acquisitions, they pointed out they’re not necessarily limited to small or mid-sized deals. GE will increase the loan to $165 million under certain conditions.
“It’s expandable,” Kolodny said.
Drive officials say they’ve found a receptive audience of manufacturers looking to sell.
“It’s competitive bidding,” Francis said. “Manufacturers are in the same position as providers, in terms of trying to achieve critical mass. It’s all about getting big fast and some don’t think they’ll be able to get big quick enough.”
WASHINGTON – HME providers say fear of being excluded from the Medicare program prompted the low reimbursement rates for the Round 1 re-compete.
“It’s the old bullet to the head or slow death question, and nobody wants a bullet to the head,” said Frank Trammell, president and CEO of Charlotte, N.C.-based Carolina’s Home Medical, which was awarded contracts for respiratory, mobility and NPWT. “It’s about staying in the game and hoping to make it up in volume.”
CMS on Oct. 1 announced reimbursement rates for the Round 1 re-compete that are, on average, 37% below the fee schedule. In Round 1, rates were, on average, 32% below the fee schedule.
Providers say Round 1 forced some of their colleagues out of business and patient care suffered, and they don’t have high hopes for what steeper cuts, combined with an expanded list of affected products, will mean.
“It’s going to be worse,” said Jim Horn, owner of Horn's Medical Supply in Athens, Texas. “On top of that, CMS has stepped up its audits.”
Horn was awarded contracts for standard mobility equipment in Round 1 and again in the re-compete.
“We had to either take the contracts or go out of business,” he said. “I’m not looking forward to it.”
To survive another go-around, providers say they’ll have to make big changes.
Ron Jenkins was not awarded contracts for nearby Orlando, but he was awarded contracts in nearly every product category in Miami, which is more than 200 miles away. While he plans to open a location in Miami, he has also had to lay off employees and close a location in preparation to absorb the rate cuts. And he’s not done yet.
“I’m going to continue to look at ways of cutting costs,” said Jenkins, CEO of Longwood, Fla.-based Respitec Medical. “Service will suffer, but the patient will be taken care of.”
CENTER LINE, Mich. – Binson’s Home Health Centers has joined forces with two hospital systems, a sign of things to come as the HME industry reshapes itself, the provider says.
“Our gut feeling is that this is how it’s going to go,” said Jimmy Binson, vice president. “This is how you are going to grow and survive.”
In October, Binson’s announced that two Michigan hospital systems, Flint-based McLaren Health Care and Grand Blanc Township-based Genesys Health System, would merge their HME businesses into Binson’s affiliate, Hart Medical. A third system, Henry Ford Health System, is in negotiations to do the same.
An HME provider-hospital system partnership gives both parties a greater core mass of business, a key to long-term viability, Binson’s officials say.
“We are consolidating their purchasing volume with Binson’s and that of our other affiliates to negotiate contracts with manufacturers and distributors,” said Ken Fasse, COO of Binson’s.
The mergers will also give the hospital systems access to Medicare contracts. Binson’s, which has seven locations in Michigan and two in Florida, won contracts in several areas for several product categories, including diabetes testing supplies.
Additionally, healthcare reform requires hospitals to reduce readmission rates or face penalties, pushing many systems to partner with HME providers that can help them accomplish that goal.
“I don’t think hospitals look at DME as a big profit generator,” said Craig Hittle, senior manager of the healthcare team at Somerset CPAs. “But, DME is a critical part of the discharge process, so I do think we are going to see more of this where it’s a win-win for both.”
In an effort to close the healthcare loop, Binson’s has also launched AssuraScript, a clinical pharmacy that will provide oversight of patients to ensure they are educated and adherent on their therapy and medications.
“With one phone call, the patient can get supplies, medications, education and clinical oversight by the pharmacist,” said Chadi Azzi, director of pharmacy operations. “This will position any partner to have better outcomes, improved revenues and a decrease in health costs.”
AssuraScript has contracted with a software provider that offers a centralized system that interfaces with physician offices, payers and other contractors to look at the patient profile from one perspective.
“This is a powerful package of services and this is going to differentiate Binson’s from other local DME suppliers,” said Fasse.
APPLETON, Wis. – It’s called “going to gemba”—a Japanese word that’s part of the Lean lexicon, meaning going to the heart of the work to study core processes.
It’s a place ThedaCare at Home goes frequently, but not just for observation. This Appleton, Wis.-based provider uses the principles espoused by the Toyota Production Method to find and eradicate muda (waste), mura (unevenness) and muri (overburdening).
“It boils down to simple things,” says Randy Lutz, manager of HME operations and support services for ThedaCare at Home, a 370-employee division of a 6,800-employee integrated health system. “Ask your staff, ‘What are the things that get in the way? What are the things that are wasteful in your day? What causes rework?’”
Not long ago, ThedaCare at Home was averaging $58 per delivery, including fuel, truck maintenance and salaries. After scouring for waste, Lutz and his team brought down that per-delivery cost to $36, while also improving driver safety.
Next, Lutz divided the volume into “skilled” and “non-skilled” deliveries, outsourcing non-skilled deliveries—which don’t require any patient communication—at a cost of $18 each. In July alone, Lutz was able to divert nearly 500 of his 1,750 deliveries to a delivery partner.
A rarity in healthcare today, ThedaCare also holds to a no-layoff policy, so improvements in efficiency don’t translate into workforce reductions.
As a result, employee satisfaction is up. Between 2011 and 2012, the number of staff reporting they are “engaged” rose from 14.3% to 37.5%, and the number of “ambivalent” staff decreased from 38.1% to 12.5%.
“There was a time when supervisors were supposedly the smartest guys in the room,” Lutz says. “We are an inverted organization. Staff are the ones seeing the improvements that need to be made, and they can go home knowing they’ve made a mark with the work they do.”
WASHINGTON – The Office of Medicare Hearings and Appeals (OMHA) will defer assignments for hearings—possibly up to 28 months, according to a recent notice. Requests for hearings received after July 15, 2013, will be entered into the agency’s case processing system and held until there is room on an Administrative Law Judge’s (ALJ) docket for adjudication. When a request is assigned, a notice will be sent, according to the notice. The ALJs have been backlogged for more than a year, thanks to increased levels of audits and appeals. The notice also states that OHMA will continue to process Part D prescription drug denial cases that qualify for expedited status within 10 days and will screen all incoming requests to make sure beneficiary issues are prioritized.
Cardinal highlights AssuraMed in earnings report
DUBLIN, Ohio – Healthcare services giant Cardinal Health has reported revenue of $24.5 billion in the first quarter of 2014 compared to $25.9 billion for the same period in 2013, a 5% decrease. The company reported net earnings of $339 million for the quarter compared to $271 million for the same period in 2013, a 25% increase. Thanks to the 2013 acquisition of AssuraMed, a home medical equipment distributor, Cardinal’s medical segment saw revenues grow 13% to $2.7 billion. The acquisition also helped to boost profit 43% to $106 million. Revenue in Cardinal’s pharmaceutical segment, however, fell 7%. It’s a drop the company expected due to expired contracts with Express Scripts and Walgreens.
OIG finds payments for dead beneficiaries
WASHINGTON – Medicare paid $23 million in improper payments on behalf of deceased beneficiaries in 2011, according to an Oct. 31 report from the Office of Inspector General (OIG). Those payments account for less than one tenth of a percent of total Medicare spending, the report says. The OIG says auditors identified beneficiaries who died between 2009 and 2011, then found payments associated with those beneficiaries paid in 2011. It also found paid and unpaid Medicare Part B claims dated after beneficiaries were deceased. Specifically, the OIG found 251 providers that had high numbers of Part B claims dated after beneficiaries deceased. About 10% of the total improper payments were the result of missing or incorrect dates of death, the report says. The OIG called on CMS to tighten existing safeguards, act on improper payments, monitor paid and unpaid claims dated after a person’s death, and act on providers and suppliers with a high number of claims made after beneficiaries died.
CMS: Zero growth for Part B premiums
WASHINGTON – The Medicare Part B premium will not increase in 2014, CMS announced last week. The standard Medicare Part B premium will be $104.90 in 2014, the same as 2013, the agency stated. “We continue to work hard to keep Medicare beneficiaries’ costs low by rewarding providers for producing better value for their patients, and fighting fraud and abuse,” stated CMS Administrator Marilyn Tavenner in a press release. “As a result, the Medicare Part B premium will not increase for 2014, which is good news for Medicare beneficiaries and for American taxpayers.” CMS pointed out that the Medicare Part B premium has been less than expected or remained the same for the past three years. Additionally, the deductible will remain $147, the agency stated. To read CMS’s notice, click here.
CMS lowers interest rates
WASHINGTON – CMS has announced a 0.5% decrease in the interest rate on Medicare overpayments and underpayments, according to a recent AAHomecare bulletin. The rate is now 10.125%. Interest on overpayments and underpayments begins to accrue on the date a refund is first requested. Rates are assessed every 30 days and are not prorated when overdue payments are received in the middle of a 30-day period, according to the bulletin. Interest charged on overpayments is reimbursed through an approved schedule. The rate will remain constant unless a provider defaults on the repayment plan, in which case the rate may change to that day’s prevailing rate, according to the bulletin.
DME MAC puts nebulizers under review
INDIANAPOLIS – National Government Services, the Jurisdiction B DME MAC, plans to conduct a widespread prepayment review of nebulizers, related drugs, accessories and dispensing fees, it announced Oct. 29. The review is an expansion of a documentation review now being conducted on oxygen equipment and glucose supplies. Suppliers of selected claims will receive a request in the mail asking for copies of the signed and dated detailed written order, applicable dispensing orders, records supporting medical necessity and proof of delivery, according to a bulletin. Suppliers must respond within 45 days or the claim will be denied. If a claim is denied, the supplier may ask for a redetermination within 120 days of the initial denial, the bulletin states.
Judge tosses Scooter Store lawsuit
NEW BRAUNFELS, Texas – Senior U.S. District Judge Harry Lee Hudspeth has tossed a lawsuit filed by former employees of The Scooter Store seeking damages over the falling value of their stock ownership plan, the San Antonio Express-News reports. Filed last spring, the lawsuit called for restoring the value of their employee stock ownership plan, which tumbled from $36.9 million in 2008 to $8.5 million in 2009. Former employees alleged company founder Douglas Harrison, Principal Life Insurance Company and First Banker Trust Services breached their fiduciary duty by not diversifying the plan. The $7 million remaining in the fund will be disbursed to former employees, according to the Express-News.
AAH formalizes Manufacturers Work Group
WASHINGTON –AAHomecare has formalized its Manufacturers Work Group, the association stated in a recent bulletin. The group will now meet regularly to share information and facilitate cooperation, focusing on legislative and regulatory issues that affect HME manufacturers. It will also share sales and marketing best practices, and promote AAHomecare membership to other manufacturers and providers. David McCausland, senior vice president of government affairs and planning at The Roho Group, will serve as chairman, and Cara Bachenheimer, Invacare’s senior vice president of government relations, will be vice chairwoman. Membership is open to manufacturers who are AAHomecare members.
Eternity Healthcare, GMEA to merge
PHOENIX and VANCOUVER, British Columbia – Eternity Healthcare, a medical device company, announced Oct. 30 that its plans to acquire Global Medical Equipment of America (GMEA), a holding company focused on medical equipment, supplies and accessories. As part of the deal, Eternity’s headquarters will move to Phoenix and be led by GMEA’s management. “This is a great opportunity for GMEA to join the public market, having access to various forms of funding and, with that in mind, grow the company astronomically in a short period of time,” stated Harold Halman, GMEA president and CEO, in a press release. The companies expect to complete a share exchange agreement in the first quarter of 2014. Eternity Healthcare will issue GMEA and its shareholders about 40 million shares in exchange for all of the shares of GMEA and its shareholders, according to the release.
Exposure improves CPAP compliance, study finds
CHICAGO – Exposure therapy can help desensitize patients to the claustrophobia or intolerance they may experience when using CPAP machines, a new study suggests. The therapy helped patients who participated in a small study to use their machines for more minutes per night, according to researcher Patricia Dettenmeier of Saint Louis University. Working with a nurse practitioner, researchers had patients wear CPAP masks an hour a day while they were awake, before using the machines during hour-long naps. Eventually, patients were able to wear the mask for three to four hours each night, gradually building up to a full night’s use.
Ottobock’sLondon “Passion for Paralympics” campaign has won the 2013 Econ Award for public relations excellence. Ottobock has been promoting the Paralympics since the 1988 games in Seoul. In 2012, the Ottobock team included 80 technicians speaking 20 languages, according to a press release…Convaid recently donated four pallets of wheelchairs and parts to UCP Wheels for Humanity. The wheelchairs will be donated to people with physical disabilities in developing countries. UCP Wheels provides fitted wheelchairs to more than 6,000 people per year…Theravent’s sleep apnea treatments have now been used for more than 4.5 million nights. Theravent’s Provent Sleep Apnea Therapy and Theravent Advanced Nightly Snore Therapy use expiratory positive airway pressure to treat obstructive sleep apnea (OSA) and snoring…Family-owned Preston Pharmacy and Home Medical is reaching out to customers nationwide through a new online store. The store, which features everything from daily living aids to bathroom safety products, is accessible through the pharmacy’s website…Pride Mobility Products and Quantum Rehab were recently recognized for their support of USA Cares, an organization providing financial assistance to and advocacy for military families. Quantum spokesman Bryan Anderson, a Purple Heart recipient who served two tours of duty in Iraq and became a triple amputee in 2005,speaks at USA Cares fundraising events…Numotion recently received the Community Service Award for Exceptional Volunteerism and Corporate Sponsorship from the southeastern Wisconsin chapter of the National Spinal Cord Injury Association (NSCIA)… Somnetics has rounded out its product offerings of portable sleep therapy devices with the Transcend Auto. The machine automatically adjusts therapy pressure during sleep, and can be used with the company’s heated humidifier and all Transcend accessories.
People news: Nonin, CareTouch, BOC
Minneapolis-based Nonin Medical has appointed Richard Eagle vice president of sales. Eagle has more than 30 years experience with Class II and Class III medical devices, and will help Nonin increase revenues by addressing changes in global sales, evaluating partnerships and refining strategies…Denver-based CareTouch Communications has hired Zuri Nance as sales manager. Nance will develop and nurture new client relationships. He has experience in research, client development and contract negotiation, and has worked three years in heath-related fields…Claudia Zacharias, president and CEO of the Board of Certification/Accreditation, International (BOC), has been named secretary treasurer of the board of directors of the Institute for Credentialing Excellence (ICE).
WASHINGTON – CMS on Oct. 31 released the names of contract suppliers that have agreed to supply HME as part of the Round 1 re-compete.
The agency awarded 997 contracts to 282 suppliers for 9 competitive bidding areas (CBAs). The contract suppliers have 620 locations to serve Medicare beneficiaries in the CBAs.
On Jan. 1, these suppliers will begin providing certain HME at reimbursement rates that are, on average, 37% lower.
CMS awarded 97% of contracts to suppliers that are already established in the CBA, the product category or both. Small suppliers, those with gross revenues of $3.5 million or less as defined by the program, make up 58% of the contract suppliers.
In Round 1, which kicked off Jan. 1, 2011, CMS awarded 1,217 contracts to 356 suppliers in 9 CBAs.
In Round 2, which kicked off July 1, CMS awarded 13,126 contracts to 799 suppliers in 91 CBAs. Additionally, it awarded contracts to 18 suppliers as part of its national mail-order program for diabetes supplies.
Now that the names of the contract suppliers are public, CMS will begin educating suppliers, beneficiaries and referral sources about competitive bidding.
CMS expects competitive bidding to save an estimated $25.8 billion for Medicare over 10 years and $17.2 billion for beneficiaries through reduced co-pays.
For a list of contract suppliers:
For a fact sheet: