Home infusion groups make progress on payment issues

By MATTHEW HAY

HHBR Washington Correspondent

WASHINGTON – Prospects are improving for home infusion providers on several payment fronts. Most immediately, the durable medical equipment carriers (DMERC) have exceeded to the demands of home infusion representatives and other Part B providers to postpone, until at least April, Medicare reimbursement reductions for enteral nutrition and six other items under expanded inherent reasonableness (IR) authority granted by the Balanced Budget Act of 1997 (BBA). Without the delay, Medicare reimbursement for enteral nutrition would have been slashed by 15%.

Last year, the National Alliance of Infusion Therapy (NAIT; Washington) and the National Home Infusion Association (NHIA; Alexandria, VA) argued that HCFA and the DMERCs were exceeding their authority by making such a deep cut in enteral nutrition. HCFA was granted IR authority in the mid-1980s to increase or decrease reimbursement for individual items of durable medical equipment prosthetics orthotics and supplies (DMEPOS) if the existing payments were found to be grossly deficient or excessive. The BBA expanded this authority and limited the requirement for notice and comment to instances where the adjustment exceeds 15%. HCFA’s latest approach has been to cap its reductions in reimbursement to 15% per year, but to make subsequent cuts in subsequent years thereby bypassing the normal rulemaking process altogether.

Home infusion provider groups argued that HCFA had inappropriately identified Category I enteral formulas as a target for an IR price reduction based primarily on an analysis of retail price data. They argued HCFA based its pricing survey on products that are not clinically equivalent to the formulas used by the majority of Category I enteral patients. The groups further argued that HCFA’s methodology does not reflect the costs associated with providing enteral nutrition therapy to Medicare beneficiaries. The delay gives infusion providers further opportunity to reduce the size of the cut.

The long-term outlook for getting Medicare to pay for enteral nutrition may also be improving. Late last year, Rep. Pete Stark (D-CA), the ranking democrat on the House Ways and Means Health Subcommittee, introduced legislation to cover prescription drugs under Medicare including enteral nutrition. The most recent meeting of the Bipartisan Commission on the Future of Medicare suggests Stark’s approach, if not his specific legislation, may be gaining momentum. Expanding Medicare coverage to cover prescription drugs was seriously discussed at the commission’s meeting earlier this month for the first time since President Clinton’s healthcare reform initiative in 1994.

A top aide to Stark recently told HHBR he expects this issue to receive even more attention in May when the Medicare Plus Choice Program must tell HCFA what benefits they plan to offer the Medicare beneficiaries in 2000. The aide suggested the pattern that developed last fall when many Medicare beneficiaries were dropped by these plans and lost any Medicare managed care option will only be the tip of the iceberg. "The headline May 16 may be that two million seniors lose their prescription drug benefit," said the aide. "You are going to have more seniors losing that benefit with HMOs, which is the main reason they joined HMOs in the first place, and they are going to be looking to Congress for answers.

"The prescription drug benefit is tough because it’s big and it’s expensive, but I will bet it becomes a major part of the presidential debate in the Year 2000 with people criticizing the Medicare program for not having a prescription drug benefit," said the aide. He also predicted that some democrats may try to scare republicans into voting against prescription drug coverage as the 2000 elections approach. "Some democrats believe that if they can get republicans to vote against prescription drug coverage three times before the election, they will be the majority party."

In a related area, the Home Infusion EDI Coalition (HIEC) and NHIA held a joint meeting in Chicago last month to develop an action plan to address pending federal regulations for electronic standards. The regulations, which are required by the Health Insurance Portability and Accountability Act of 1996 (HIPAA), will require administrative simplification for health insurance transactions such as electronic claims.

HIEC and NHIA members are attempting to use these regulations to establish a medical classification and reimbursement coding system that meets the long-term needs of home infusion providers and payers. Specifically, the two groups want to maintain a coding system developed by HIEC in 1995 that it says is already used by more than 80 insurance companies as the national standard. As early as 1997, HIEC asked the Department of Health and Human Services (Washington) to include HIEC codes in the HIPAA standard.

The two groups are also working to eliminate complicated split billing’ in which infusion drug claims are submitted separately from other components of professional infusion therapy clinical services. In addition, they hope to use development of a new standard as an opportunity to develop a coding process that recognizes professional services provided by pharmacists while rendering professional/cognitive services for patients.

"Simplicity that lowers provider’s days sales outstanding and gives payers better information is the short-term objective," according to NHIA Executive Director Lorrie Kline Kaplan, "while recognition of cognitive professional services is a longer term objective." A summary of the meeting and a HIEC enrollment form are available by contacting NHIA at (703) 549-3740. HIEC’s next meeting will be May 18, 1999, in Fort Lauderdale, FL, immediately prior to NHIA’s annual conference at the same location.