Making sense of the IPS mess: Where's the confusion headed?

Many people want to fix it, but the best solution may be to scrap it

Unless you've been under a rock for the past few months, you know the interim payment system (IPS) has created a ruckus in the home health industry that hasn't been seen since, well, last year's Operation Restore Trust fiasco.

IPS affects every home health provider that bills Medicare, but the industry isn't going down without a fight.

"There is a proliferation of bills out, each of which would do something to try and make things better," says Dayle Berke, director of government affairs for the Washington, DC-based National Association for Home Care (NAHC). "Each time anyone signs on to any of those bills, it registers yet another voice that shows that the IPS needs substantial fixing and that the momentum is building. It's really significant that so many people are taking an interest in this battle."

Legislation to "fix" IPS isn't the only battle facing the Health Care Financing Administration (HCFA).

"There is a lawsuit filed in Texas, and NAHC has filed one suit and is going to file another," says Berke. "We believe that HCFA could have done something potentially favorable for the industry to make things more palatable, or they could have made it more difficult for the industry, and they chose the latter. We have filed a lawsuit challenging HCFA's interpretations of the regs and how they were issued. We're also going to file a lawsuit challenging the entire constitutionality of the IPS."

Between court battles and legislation, it's difficult to say where IPS will end up by year's end, but Berke says you can count on change.

"The will is there [in Congress] to do something this year," she says. "We don't know what the vehicle will be yet, but there likely will be some form of amalgam of all this."

Berke notes that it appears the main thrust may come from the Senate, which has a Finance Committee-based bipartisan working group addressing IPS.

"In the weeks ahead we'll probably see something come out of that working group," she says.

IPS is proving more complex than most health care issues for those who are taking up the cause.

"We typically work with the committees of jurisdiction - the Finance Committee, Ways and Means Committee, and the Commerce Committee - and spend most of our effort on those folks," says Berke. "But because there has been such a huge cry against the IPS and an outpouring of grass-roots opposition to what was enacted, members of both the House and Senate, who normally don't get involved in health issues at all, let alone complex reimbursement issues in home health, have gotten very interested in what is going on and are contacting the committees of jurisdiction."

But such an outcry for change in IPS doesn't mean there is a guarantee anything will take place. Many congressional members are keeping a watchful eye over any revisions considered for the IPS.

"[Congress] wants the industry to agree and wants the system to be budget-neutral," says Berke. "They are concerned about having something come out and having other entities say, `We were hurt under the Balanced Budget Act, but if you give home care this money, why can't you do something for us?'"

Who gains, and who loses?

Getting the industry to agree won't prove an easy task. Because the IPS calculation is so complex, IPS doesn't affect all providers in the same way. So any time the IPS formula is revised, some providers will gain and some will lose.

"The big issue is going to be getting the industry to agree on per beneficiary limits," says Berke. "This gets to be a very divided issue depending on the type of provider and geographic area. Because some areas of the country have far lower limits than others, as various pieces of legislation are introduced, they may hurt one part of the country and help another, or vice versa."

Why not scrap the whole plan and move right into a prospective payment system? Again, it's dollars, says Berke.

"People are still working on coming up with an equitable solution rather than getting rid of the entire system," she says. "Although that is what the industry would like, there is some resistance to that on Capitol Hill because of the dollars [savings] that [IPS] brings in."

Alan Parver, JD, president of the National Alliance for Infusion Therapy (NAIT) in Washington, DC, says there are a number of other developments that may or may not surface before the year's end, although time is clearly not on Congress' side.

"The session is moving quickly to a close," says Parver. "They would like to end the session early in October, and take most or all of August off for a district work period, so there are not that many days left in the session for something complicated or controversial."

Parver notes that two possibilities are a fraud and abuse bill and a technical corrections bill to the Balanced Budget Act, but nothing is clear yet with the flurry of legislation being introduced. Because of the time constraints, don't expect any all-encompassing technical bills.

"Technical corrections in past years have been more than simply minor technical corrections, and in fact sometimes become vehicles for far more substantive legislation," says Parver. "But if there is a technical corrections bill, there will be a real concerted effort to limit it to provisions that people can agree on."

Parver also notes that there is a slight possibility for a mini-reconciliation bill if Congress feels the need for more savings, but a full-blown effort is unlikely because of time constraints.

According to Parver, the competitive bidding demonstration project, scheduled to include enteral nutrients and supplies, is close to naming its sites and taking the next step, which would be implementation.

Safety Act still a possibility

HR 2754, introduced by Rep. Pete Stark (D-CA), is alive and well. The bill, called the Healthcare Worker Safety Protection Act, would require hospitals and hospital-owned care provi ders to use only hollow-bore needle devices that minimize the risk of needlestick injury. (See Home Infusion Therapy Management, February 1998, p. 13.)

The bill has been referred to three different committees with jurisdiction: the Ways and Means subcommittee on health, the Commerce Subcommittee on Health and the Environment, and the Veterans Committee. A spokesman from Stark's office tells HITM the bill has 68 cosponsors, but only three are Republican.

It appears that the main opposition will come from hospitals that don't approve of a federal mandate they say will mean extra costs. Stark's office refutes the claim.