Funding Essentials

Whac-A-Mole, Anyone? Medicare & Medicaid Challenges

Do you ever feel like as soon as you get one reimbursement issue under control, two more pop up?

With Medicare you have audits around every corner, the elimination of the least costly alternative policy, competitive bidding looming over the heads of most major metropolitan areas, and capped rental for low-end power wheelchairs, to name a few.

Then there are Medicaid programs constantly pursuing cost savings by any means necessary. Lowlights include state-level competitive bidding programs, potential provision of used equipment, attempts at limiting benefits for equipment to those less than 21 years of age… and my favorite: insisting that a Group 2 power wheelchair is sufficient to meet the needs of people with complex medical conditions.

Government funding has become like a never-ending game of Whac-a-Mole. Medical suppliers have to be more like firefighters than business people nowadays.

Medicaid Update: Hunting for Cash in All the Wrong Places

State Medicaid programs are strapped for cash, no doubt, but they are cutting spending in ways that are detrimental to the very people they serve — their beneficiaries.

Rather than consider fixing internal procedural inefficiencies to save money, it is easier to say, “This particular population is no longer covered,” or “We aren’t paying for new equipment anymore.”

If the cost-savings challenges aren’t enough, there is always a good administrative issue or two to slow down receipt of your money. Whether it’s non-acceptance of the universal HCPCS coding system mandated by HIPAA more than eight years ago, or the untimely approval of prior authorizations, you’re bound to run into an obstacle somewhere along the way. And when you finally snip through all the red tape and jump through all the hoops, you can look forward to working with a payment methodology that may be enough to help you break even.

Unfortunately, there is no easy resolution other than educating and lobbying state legislators to make necessary changes and to vote against bad ideas. Of course, this requires time away from the office and more money spent to protect your business, as well the benefits of those you serve. It’s a vicious circle, but necessary in the current reimbursement environment.

Medicare Update: Audits & Least Costly Alternative Change

Audits have become a major concern for nearly all medical equipment suppliers. From pre- and post-pay reviews to CERT, RAC and ZPIC audits, it’s a wonder any claims make it through the system without extra attention.

I cannot recall a time when providers have been under this much scrutiny. Cash flow is the biggest concern: Not only does the added review time slow down the payment process, but even when your claim is paid, there is no guarantee you’ll get to keep the money in the long run.

The best advice at this point is to not cut any corners. Make sure you’ve done your due diligence by double-checking yourself before submitting claims. Medical necessity documentation is the huge focus, and while it can be challenging to get every “i” dotted and “t” crossed, your getting paid and staying paid relies on it under the current circumstances.

Medicare dealt our industry another blow on Feb. 4 by eliminating the least costly alternative language from its medical policies. This is especially troubling in the power mobility world, because the change in policy also disallowed the option to upgrade to Group 2 scooters, Group 2 power wheelchairs with a seat elevator, and Group 4 power wheelchairs. This essentially took away a patient’s freedom of choice by not even allowing them to pay out of pocket for products they want, but don’t qualify for.

Due to industry outcry, the ability to provide an upgrade was restored on June 1 for Group 2 scooters and Group 4 power wheelchairs, which leaves a window of nearly four months where beneficiaries were not able to receive a requested upgrade. Group 2 power wheelchairs with a seat elevator were not included in this update and have since been labeled statutorily non-covered. For all intents and purposes, this ruling will turn codes K0830 and K0831 into retail items once the trickle-down effect starts hitting other funding sources.

Competitive Bidding Repeal Efforts Gain Strength

On March 11, Rep. Glenn Thompson (R-Pa.) and Rep. Jason Altmire (D-Pa.) officially introduced a bipartisan House bill to repeal competitive bidding. H.R. 1041 is also known as the Fairness in Medicare Bidding Act At press time, there were 107 co-sponsors signed on. The industry needs as much Congressional support as it can get, so you can help take this “atrocious” (to quote University of Maryland economics professor Peter Cramton) program down by making sure your state representation supports the bill.

You can get talking points, issue papers and other supporting materials to help educate your representatives on the repeal by visiting the American Association for Homecare Web site at It would be ideal to get the program repealed before it impacts the next 91 cities (bidding for round 2 of the program is slated to begin in early 2012).

A point that is important for suppliers to know is even if you are not located in or don’t do business in any of the first 100 cities involved in competitive bidding, the program will eventually impact you negatively if it isn’t stopped.

This article originally appeared in the July 2011 issue of Mobility Management.

About the Author

Jim Stephenson is Reimbursement & Coding Manager for the Rehab Department of Invacare Corp.

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