I've been following tweets about the "doc-fix" bill and comments about the replacement of Centers for Medicare and Medicaid Services’ (CMS’) Durable Medical Equipment, Prosthetics, Orthotics and Supplies (DMEPOS) competitive acquisition program [aka competitive bidding]; with the Market Pricing Program (MPP) and have been perplexed by the ongoing focus on equipment.
Value Based Healthcare is the way in which healthcare is delivered now in our country; the inputs (resources or products used) don’t matter but the outputs (better outcomes at reduced costs) are most important. The DME industry must focus its efforts on providing Value Based Healthcare.
The president signed into law on Tuesday a bill that gave doctors temporary relief from Medicare's sustainable growth-rate formula that would have resulted in a 24% reduction in their fees. While the law delays cuts for physicians and extends the deadline for ICD-10 implementation, it did not include within the final markup provisions to repeal or replace the controversial competitive bidding program.
The stakeholders in the DME industry have consistently criticized CMS' design of the program, and as such pursued an alternative through lobbying efforts with members of congress. Proponents of the MPP believe a binding bid (unlike the current bidding methods according to industry stakeholders) will assure consistency with prices identified in bid awards and prevent CMS from increasing rates post awards due to their reasonableness methodology. (CMS raises prices because they feel they are reasonable).
CMS’ perception of the relative importance of binding bids is not the same as the DME industry’s. CMS believes the program will continue to be widely successful in savings. Their estimates are $25.7 billion between 2013 and 2022 (see CMS FAQ) for equipment and beneficiaries will save $17.1 billion over the same period. Repealing or replacing the program is likened to the Affordable Care Act (ACA). It simply will not happen. In fact, the ACA calls for expansion of the program nationwide by 2016, beyond the current areas.
The DME industry must shift its focus and demonstrate value by providing services that help to improve health outcomes while reducing costs. There needs to be a concerted (not fragmented) effort on program development that involves clinical services, which are essential for the population of patients served by DME providers; those diagnosed with Chronic Obstructive Pulmonary Disease (COPD).
I recall co-authoring a white paper on behalf of the American Association for Homecare (AAHomecare) with Joe Lewarski, BS, RRT, FAARC, entitled “Value of Homecare: COPD and Long-Term Oxygen Therapy” in which we highlight the importance of oxygen therapy on health outcomes; cost utility and effectiveness. While oxygen therapy adds value and is important in the treatment and management of patients with COPD; the clinical services are of paramount importance to support patient engagement and education, monitoring to prevent emergency room encounters, hospital admissions and ensure an overall better quality of life. All of which are value-based services.
The reality is that CMS’ focus is on establishing value for our patients; and will reward us for demonstrating better outcomes while reducing costs. The question then is how do we deal with the new normal in which we must demonstrate value?
There are countless examples in which respiratory therapists (RT's) have demonstrated value at certain organizations by improving the treatment and management of patients with COPD; which has resulted in better health outcomes while reducing costs. The problem is that the vast majority of DME providers have eliminated or reduced the role of the RT to the extent it would be difficult to create and scale programs in a manner in which they are effective. Now is the time to retrench and consider where healthcare is today and where we are heading for the future. We have a burning platform of change that now requires us to focus on the patient and develop meaningful clinical services that add value.
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