DME INDUSTRY VOICES COMPETITIVE BIDDING CONCERNS:
A bipartisan briefing was held for House of Representatives staff on March 1, in order to hear the concerns of durable medical equipment (DME) suppliers with regard to the new Medicare DME competitive bidding program.

The program – which began on January 1, 2011 for nine areas of the country and for nine product categories – has caused beneficiary access problems in addition to problems for suppliers, according to the industry. It is scheduled to begin later in 2011 for 91 other regions.

The briefing was organized by Representatives Glenn Thompson (R-PA) and Jason Altmire (D-PA), who both represent areas that are currently impacted by the program. Speakers included the President of the American Association for Homecare, who cited complaints from patients who had difficulties in obtaining equipment and stated that the competitive bidding program should be halted immediately. Additionally, local DME suppliers made clear their concerns that the program is threatening the quality of care for Medicare beneficiaries and could cause smaller DME suppliers to be forced from the market.

The speakers urged Congress to consider legislation that would stop the program – similar to legislation that delayed the DME program in 2008 and required the Centers for Medicare and Medicaid Services (CMS) to make changes. To that end, the briefing’s organizers are working to produce legislative language that will achieve this goal while also including necessary offsets to make up for the savings that the program is supposed produce for Medicare.

CMS TAKING STEPS TO CUT HEALTHCARE-ASSOCIATED INFECTIONS:
On March 2, CMS Administrator Donald Berwick discussed the important role that the new Center for Medicare and Medicaid Innovation (CMI) will play in combating healthcare-associated infections. Speaking at a forum on such infections and their impact on the cost of healthcare, Administrator Berwick cited the need to improve patient safety and stated that the CMI – which was established by the Patient Protection and Affordable Care Act (PPACA) last year – will sponsor pilot programs and demonstration projects in order to attain such quality of care goals.

Hospital-acquired infections (HAIs) accounted for approximately 1.7 million infections in 2002 and 99,000 associated deaths, and another estimated 1.6 million to 3.8 million infections occur each year in long-term care facilities, according to the Department of Health and Human Services (HHS). HHS data also attributed an estimated $28 billion to $33 billion in preventable healthcare expenditures to these infections annually.

The PPACA has provided $5 billion in start-up funding and an additional $10 billion for demonstration projects to the CMI, which has been using the federal dollars to focus on multipayer programs at the state level and integrated care. The center is also engaging in listening sessions and other strategic development initiatives in order to increase knowledge on how to prevent HAIs and to determine what role the CMI can play in disseminating that knowledge and ultimately improving quality of care.

HOUSE PASSES BILL TO AMEND PPACA:
The House took up legislation last week that would repeal the so-called “1099 provision” in the PPACA.

Widely unpopular on both sides of the aisle, the 1099 provision requires that businesses file a 1099 form with the Internal Revenue Service for every vendor to whom they pay more than $600 in a year, beginning in 2012.

The House bill – H.R. 4 – would eliminate that tax reporting requirement for businesses, and also includes language that would eliminate the requirement for owners of rental real estate. Further, the measure would allow the government to recapture a larger share of overpayments to consumers receiving health insurance subsidies for the new health exchanges in order to make up the $19.2 billion in tax revenue that it is estimated the 1099 provision would produce over 10 years.

The House approved H.R. 4 by a vote of 314-112 on March 3. While the 1099 repeal largely enjoys bipartisan support, 112 House Democrats did not support the measure due to opposition to the manner in which the tax revenue would be offset.

The Senate has already given strong bipartisan approval to a similar 1099 repeal provision, but would offset the lost revenue by rescinding other unobligated funds. This lack of agreement on offsets reveals how even a popular policy change may fall victim to partisan differences this year.

MEANINGFUL USE UPDATE:
As the Office of the National Coordinator (ONC) for Health Information Technology (IT) at HHS works to implement meaningful use requirements in the adoption of electronic health records (EHR), industry stakeholders have begun to weigh in on the need to delay the onset of Stage 2 in this process. Simply stated, achieving “meaningful use” means that providers must show they are using certified EHR technology in ways that can be significantly measured in both quality and quantity.

Currently in Stage 1 of a three stage, five year process, the meaningful use objectives for Stage 1 are divided into a core group of required objectives (15 for eligible professionals and 14 for eligible hospitals) and additional optional objectives of which a several must be chosen from a set menu of options. Stage 1 will encompass 2011 and 2012, and Stage 2 is expected to commence in 2013 in order to expand on the current required objectives.

In recent comments, stakeholders have urged caution and greater flexibility as this process continues in order to allow more providers to successfully participate. For example, the American Medical Association (AMA) and 37 other medical societies stated in a recent letter to the ONC: “While we support a staged approach to meaningful use, this approach must take into account the current technological realities and the financial and administrative burdens placed on physicians.”

We continue to monitor the progression of EHR/meaningful use implementation and will provide you with periodic updates as deadlines and requirements are set and the process moves forward.

NEXT STEPS:
As these and other matters are considered by Congress, we continue to follow news from Capitol Hill. In addition, we continue to monitor HHS and other federal agencies as the implementation of healthcare reform progresses and other related issues arise. We will bring you timely updates as these developments occur.