No more sieges

Saturday, August 31, 2002

Look at North Carolina. As talk about competitive bidding started percolating among legislators there, the state's HME association started filling sandbags until the flood subsided and, as it looks now, the dreaded reimbursement formulary shrunk away again.

Listen to Clark Robichaux, the state's HME association president: "We took a strong look at the fee schedule and determined that there is nothing there that can't take a hit." Pretty frank stuff.

Consequently, HME providers in N.C. may realize a 3%-4% reimbursement reduction. Beats the 20%-plus wallops that competitive bidding invites.

In Texas, providers have identified millions in savings. They'd rather make those concessions than let market forces set pricing.

Nationally, HME providers can't do this now. Not when guys with DME on the brain like Sens. Bob Graham and Tom Harkin want to take the wraps off the Invisible Hand and turn the provision of home medical equipment and services into a commodity proposition.

Fees for healthcare services shouldn't be market driven, not the way the price of an oil change is. There's more at stake here. Everybody knows this. Let the market set the price of providing an oxygen concentrator, and pretty soon it's down to $50 a month and one of the nationals has got all your business.

Most independents would agree with this. They like the fee schedule. They want to keep it. Rephrase this and, all of a sudden, here's something that, on the face of it, sounds like an anathema. Substitute regulation for fee schedule. HME providers like regulation. Want to keep it.

If you go this far, if you can embrace the notion that this is a market better regulated than free, then it's time to focus on who's in your arms. Right now it's Tom Scully, and he's telling you he loves competitive bidding. (See story.)

He needs to be talked out of this. As soon as a critical mass of HME providers put down this year's proposal to roll out the Bidding, the HME industry has to take a hard look at its DMEPOS percentages.

On the national level, providers need to do what the North Carolinians and the Texans are doing: Identify areas where Medicare may be paying too much. Do that and you've earned the right to point out areas where Medicare is paying too little.

No question. There's got to be another way to handle reimbursement. The industry doesn't get to maximize its value in the healthcare continuum if its advocates (re: AAHomecare) are constantly manning the bulwarks against another siege. It just gets to put off the siege until another day. HME