Home Health & Hospice Week

Stay alert as next year's rates are hammered out in Washington.

Home health agencies and oxygen suppliers are at the top of lawmakers' hit list for the 2008 budget.

Lawmakers continue to negotiate the particulars of legislation that would avert the 10 percent cut to physicians' Medicare payment rates. And the White House is making it much more likely that home care providers will bear the burden of paying for it.

Senators on the Finance Committee are crafting a Medicare package and hope to release it very soon. But they have to agree on whether cuts to Medicare Advantage plans or other providers--especially HHAs and oxygen providers--will fund the doc fix.

A group of five U.S. Senators are urging leaders of the committee to leave oxygen out of the Medicare cuts currently under consideration in Congress. "The timing is crucial since the Finance Committee has been reviewing cuts in Medicare, and home oxygen therapy is a target," said the American Association for Homecare in a recent bulletin to members.

The Nov. 19 letter, signed by Sens. George Voinovich (D-OH), Susan Collins (R-ME), Tim Johnson (D-SD), Johnny Isakson (R-GA) and Sheldon Whitehouse (D-RI), notes that in recent years, the Medicare oxygen benefit "has sustained an estimated $1.5 billion payment reduction."

The Senators add that the competitive bidding program for home medical equipment is set to further reduce payments for oxygen therapy by an estimated 10 percent in the round-one competitive bidding areas.

"Many of the recent policy changes have not yet been fully implemented, and their impact has not been evaluated," cautions the letter. Gridlock Could Benefit Providers Republicans oppose cuts to MA plans and Health and Human Services Secretary Mike Leavitt publicly has asked Congress not to reduce payments to the managed care organizations.

"Medicare Advantage enrollees are overwhelmingly satisfied with their choices for care, and enjoy substantial benefits and value," Leavitt said in a Dec. 3 release. "Both have proven to be highly popular with the American people and worthy of continued support from Congress."

The Bush Administration's opposition to MA cuts will make it much harder for home care providers to stave off cuts to their rates next year, observers expect. "Home health, skilled nursing facilities, and other Medicare providers are in danger of Medicare cuts to pay for the physician fix," warns the National Association for Home Care & Hospice.

On the other hand, the power struggle between the White House and Congress may mean no budget legislation gets passed this session at all, leaving the nearly 3 percent increase to HHA rates intact in 2008 and oxygen rates untouched, except by bidding.

Watch out: But when that scenario occurred two years ago, HHAs saw their rates rolled back retroactively to the previous year's rates on Feb. [...]