Editor's Note

Your New Department

HMEs should know by now that Government Relations is a business imperative.

• By David Kopf
• Oct 01, 2015

As the Centers for Medicare and Medicaid gears up to nationally expand competitive bidding to non-bid areas on Jan. 1, 2016, providers are once again hearing the legislative call to arms. That said, some of them might be wondering why they have to keep running to man the ramparts. In fact, some folks in the industry will likely admit to feeling a little worn out at this point.

Feeling exhausted is a natural response to the regulatory overload — Why does CMS seem to constantly be in attack mode? Why do we always have to deal with another legislative fight? Can’t we catch a break?

Well, to be blunt, no, we can’t catch a break. In fact, we should expect regular legislative fights at this point. As long as HME providers continue to bill Medicare, they will likely see more public policy frustrations as HHS continues to try and manage costs for a program that comprised a whopping 14 percent of the 2014 federal budget. True, the DMEPOS benefit makes up roughly 2 percent of the Medicare budget, but that’s beside the point — CMS is looking to cut, and we will be part of those cuts for as long as Congress wants the agency to reduce its budgetary footprint.

Am I saying that providers should abandon Medicare altogether? No. While I regularly advocate that providers need to branch out and develop new revenue streams, such as retail sales, or new vertical opportunities, such as home access, there is a viable market of Medicare beneficiaries to be served.

The New Normal

What I’m arguing is that the tsunami of reimbursement cuts, audits, and regulatory difficulties that CMS has directed at the industry over the past several years is the “new normal.” If you are tired of legislative and regulatory fights, then Medicare is not your market.

If providers want to continue billing Medicare, then Government Relations should be a regular “department” within their businesses. Am I saying that providers should employ full-time staff to monitor public policy; interface with key industry organizations such as the state association and the American Association for Homecare; and coordinate a provider’s industry advocacy and lobbying efforts? Well, in the case of a large, regional provider, I think there is strong reason to consider directing budget to such a position.

For a smaller provider with limited resources, I think the response will have to be more nimble. Government Relations might not be so much a department as it is an action plan for the whole team. First and foremost, provider leadership should be working with their state associations and AAHomecare to ensure they are getting the right updates and communications. Then they should work to develop a team approach, perhaps splitting duties so that one staff member monitors policy changes, while another interfaces with legislative aides, while another team member helps facilitate patient lobbying (when needed), and so forth.

The key is to have a method and team members for responding to legislative “calls to arms” in place. This way, if and when CMS begins the process for implementing a new policy, then the provider can support the industry response in an orderly fashion that feels less like freaking out, and more like dealing with business-as-usual.

Case in Point

For example, let’s get back to the threat du jour: expansion of competitive bidding. As part of the Affordable Care Act, CMS must expand competitive bidding reimbursement rates to non-bid areas on a national basis, starting on Jan. 1, 2016.

As AAHomecare President and CEO Tom Ryan points out in this issue’s roundtable article, “Setting a Smart Strategy” (page 24), this expansion represents a major threat to providers in rural areas, as well as their patients, because those providers will have no way to adjust to the cuts. They can’t expand market share or develop new business models due to their geographic constraints. Those providers will take revenue hits they can’t sustain, and if they shutter as a result, their patients will not have access to much-needed DME. Furthermore, private payor insurance will be watching these cuts and following suit by cutting their reimbursement rates in all their markets.

AAHomecare and other industry organizations and legislative experts are working with lawmakers to develop legislation that will need your support. They will need dedicated advocacy from the industry in order to fight this expansion. Will you have the resources in place to lend a hand? Let’s hope so.

This article originally appeared in the October 2015 issue of HME Business.