Editor's Note

The Ultimate Bottom Line

Every argument HMEs make on the Hill to defend homecare should hinge on jobs.

• By David Kopf
• Oct 01, 2011

If there’s one political priority that supersedes all others on Capitol Hill today, it’s jobs. The national unemployment rate has been hovering around 9.1 percent for longer than a year, and in some states, unemployment has gone into doubledigits. That’s an untenable situation.

If you believe that middle America is the true engine of the economic growth, then it is imperative that those residing in that economic sweet spot need to be regularly and gainfully employed so that they can invest back into the economy. Once we middle America gain some jobs, then we’ll start to see the economy regain some lost momentum.

Bearing that in mind, it’s no wonder you can’t turn on the television news or pick up a newspaper without seeing the President, Congress and GOP Presidential candidates all demanding to know what each other’s plan for jobs growth is. What would truly be inspiring is if any of this righteous indignation actually got someone hired.

Contradictory Agendas

Don’t get me wrong. There is some walk behind the talk; President Obama has asked Congress for $458 billion to drive new jobs. However, any proposed job growth measures should be tempered by the fact that the administration supports competitive bidding, which, through a massive culling of the number of HME providers serving Medicare beneficiaries, will only serve to slash tens of thousands of jobs in the homecare sector.

It’s worth reviewing research commissioned by the VGM Group toward the end of last year. VGM found that competitive bidding would cost more than 80,000 jobs in CBAs over the next three years, and that the ultimate unemployment fallout from competitive bidding would most likely reach 100,000 jobs. It also projected that 42 percent of non-contract holders would go out of business; and that 39 percent of all suppliers in CBAs would go out of business — and all those jobs with them.

And that’s not the only HME job killer out there. A new study estimates that the excise tax placed on DME manufacturers via January’s health reform legislation willkill up to 43,000 jobs.

And then there is the great unknown, represented by the super committee set up by the agreement between Congress and the President that requires a bicameral, bipartisan committee of just eight lawmakers to outline a plan for covering $1.2 trillion in shortfalls over the next 10 years. As you can read in the sidebar to this month’s to feature, “Competitive Bidding Crossroads,” there’s a good chance the industry can expect more cuts to be suggested by the super committee.

Already we know that the super committee is considering mandatory pre-payment review for all power mobility claims, and applying Round One competitive bidding rates to Medicaid reimbursement in the states affected by Round One. Those two prospects will negatively impact providers who have already had their funding slashed to the bone, and the additional lost revenue will ostensibly result in thousands more lost jobs.

As grim as the prospect of increasing job losses in homecare might be, it also represents a compelling political foot in the door when it comes to meeting with legislators. Simply put, jobs are the ultimate bottom line.

Providers need to contact their lawmakers and let them know what any cuts could do to their businesses, and ultimately, what that would amount to in terms of lost jobs and incomes that will be pulled out of their local economies. A Representative can talk about reducing Medicare’s budget footprint, but if you tell that lawmaker that competitive bidding will eliminate a large number of jobs in his or her district, that should hopefully give that Representative pause. Now is the time for providers to make that case.

This article originally appeared in the October 2011 issue of HME Business.