Editor's Note

Turning Injustice Into Initiative

• By Janis Rizzuto
• Sep 01, 2010

There are competing forces in the health care universe, and I’m reminded of them every time I open my inbox to find news from CMS.

We all know what happened on the first day in July. CMS released news about its DMEPOS Competitive Bidding Program, touting that it will cut reimbursement for certain equipment by an average 32 percent and save an estimated $17 billion over 10 years. Just two weeks later, CMS proposed payment changes for home health agencies in 2011 that would decrease reimbursement for services by 4.75 percent, or $900 million in 2011.

Compare that information with other news from the agency in the same month. On July 16, CMS released its final payment rule for skilled nursing facilities for fiscal year 2011, announcing that nursing homes will receive an increase of 1.7 percent, which equates to an estimated $542 million more to nursing homes across the country in fiscal year 2011. That same day, CMS also published its final payment rule for inpatient rehabilitation facilities for fiscal year 2011. The average inpatient rehab facility will receive a 2.16 percent payment increase beginning Oct. 1, 2011. Overall, CMS projects that 2011 payments to such facilities will increase $135 million.

And on the last business day in July, CMS issued its final 2011 payment rule for acute care hospitals and long-term care hospitals. Aggregate Medicare payments to acute care hospitals will decline by 0.4 percent, or $440 million, and payments to long-term care hospitals will increase by 0.5 percent, or $22 million.

Laid out this way, we can all see where the money’s going, and it appears to be the opposite direction from home-based care. Clearly, there’s nothing fair about the situation. But what did our mothers say when we sulked about an injustice? “Life’s not fair.” And neither is business. But there’s no time for woe-is-me malaise. That’s why this month’s cover section focuses on actions to strengthen your business in the hostile payment environment. Industry leader Lou Kaufman, RRT-NPS, shares cost-cutting tips. And the article about home transfilling systems highlights the efficiencies of nondelivery.

I like this sage, no-nonsense comment from Extrakare’s Scott Lloyd: “I have no idea what’s going to happen with competitive bidding, but I do know that we are all going to get paid a lot less in the future to do what we do today. Either competitive bidding is going to stay, and we are going to get paid less, or competitive bidding is going away, and there’s going to be a big pay-for. What you do to prepare your business for it is the same either way.” Time to get busy. As our moms used to say, “Hard work pays off.” We must do it so that we’ll be around when CMS figures out that home care works.

This article originally appeared in the Respiratory & Sleep Management September 2010 issue of HME Business.