WASHINGTON – The Senate yesterday passed a “doc fix” bill that delays ICD-10 implementation for one year, until Oct. 1, 2015, according to news reports.

The House of Representatives passed a similar bill on March 27.

The “doc fix” bill, which now heads to the president’s desk, prevents a 24% cut in physician pay for another year, until April 1, 2015.

It’s the 16th time that Congress has passed such a patch on physician pay, rather than come up with a permanent fix, according to reports.

Reaction to the ICD-10 delay was mixed. While it gives breathing room to some organizations, it frustrates others that have committed resources to transitioning to the new set of codes by the original deadline, Oct. 1, 2014, according to reports.

Like the House bill, the Senate bill did not address competitive bidding.

“Although we’re disappointed that Congress didn’t include fixes for Medicare’s poorly managed bidding program, we’ll continue to get cosponsors for H.R. 1717 and look for another piece of legislation that can carry its provisions,” said Tom Ryan, president and CEO of AAHomecare, in a statement.

H.R. 1717, which would replace the competitive bidding program with a market-pricing program (MPP), currently has 171 co-sponsors.

WASHINGTON – Medi-Cal, California’s Medicaid program, could have saved $3.9 million on standard power wheelchairs, oxygen systems and oxygen concentrators in 2011 by using a competitive bidding program, the Office of Inspector General (OIG) has found.

In its report, the OIG recommended Medi-Cal establish a bidding program like Medicare’s, or revise its reimbursement methodology so pricing is more in line with bid prices.

Though it disagreed with the OIG’s estimated savings, Medi-Cal agrees it should change its reimbursement methodology in 2014, according to the report. 

“The state agency indicated that it would be more cost-effective to align DME rates to 80% of Medicare’s rates annually and that it will update its DME Medi-Cal rates in 2014,” the report stated. 

Medi-Cal also said it would review a competitive bidding program to determine the costs and benefits associated with implementing such a program in the future, according to the report.

The OIG reviewed $12 million in Medi-Cal payments for standard power wheelchairs, oxygen systems and oxygen concentrators. Auditors compared payments made by Medi-Cal to those made in certain cities in California as part of Round 1 of competitive bidding.

WASHINGTON – President Obama has signed a “doc fix” bill that delays ICD-10 implementation for at least one year, until Oct. 1, 2015. The Senate passed the bill last week, and the House of Representatives passed the bill on March 27. The “doc fix” bill prevents a 24% cut in physician pay for another year, until April 1, 2015. It’s the 16th time that Congress has passed such a patch on physician pay, rather than come up with a permanent fix, according to reports. Reaction to the ICD-10 delay was mixed. While it gives breathing room to some organizations, it frustrates others that have committed resources to transitioning to the new set of codes by the original deadline, Oct. 1, 2014, according to reports. Like the House bill, the Senate bill did not address competitive bidding. “Although we’re disappointed that Congress didn’t include fixes for Medicare’s poorly managed bidding program, we’ll continue to get cosponsors for H.R. 1717 and look for another piece of legislation that can carry its provisions,” said Tom Ryan, president and CEO of AAHomecare, in a statement. H.R. 1717, which would replace the competitive bidding program with a market-pricing program (MPP), currently has 171 co-sponsors.

Patent case nears trial

SAN DIEGO – Just ahead of a trial, ResMed has dropped one of its patent infringement claims against BMC Medical/3B Medical, according to BMC/3B Medical. ResMed voluntarily withdrew the patent from investigation after an International Trade Commission (ITC) administrative law judge issued a ruling that restricted the scope of its claims, according to a release. ResMed in May 2013 filed a lawsuit against BMC and announced several months later that the ITC had agreed to investigate theChinese medical device manufacturer and its U.S.-based distributors, 3B Medical and 3B Products, for patent infringement.A trial is scheduled for April 10. ResMed filed a similar lawsuit against Taiwanese manufacturer Apex Medical in 2013. The U.S. patent and trademark office in February agreed to re-examine five ResMed patents in response to challenges filed by Apex.

Letter sends ‘strong message’ about bid program

WASHINGTON – A letter urging CMS Administrator Marilyn Tavenner not to expand competitive bidding until the Office of Inspector General (OIG) has completed its investigation into the program has been signed by 83 members of Congress, according to The VGM Group. Reps. Glenn Thompson, R-Pa., and Bruce Braley, D-Iowa, who spearheaded the effort, stated in the letter: “Concerns have stemmed from the lack of transparency, the improper vetting of the financial wherewithal of many firms that have been awarded contracts, and design flaws that were identified by over 240 economists and auction experts.” VGM says the letter, which was sent to Tavenner on March 28, sends a “strong message.”

Bid program would save Medi-Cal millions, OIG says

WASHINGTON – Medi-Cal, California’s Medicaid program, could have saved $3.9 million on standard power wheelchairs, oxygen systems and oxygen concentrators in 2011 by using a competitive bidding program, the Office of Inspector General (OIG) has found. In its report, the OIG recommended Medi-Cal establish a bidding program like Medicare’s, or revise its reimbursement methodology so pricing is more in line with bid prices. Though it disagreed with the OIG’s estimated savings, Medi-Cal agrees it should change its reimbursement methodology in 2014, according to the report. “The state agency indicated that it would be more cost-effective to align DME rates to 80% of Medicare’s rates annually and that it will update its DME Medi-Cal rates in 2014,” the report stated.  Medi-Cal also said it would review a competitive bidding program to determine the costs and benefits associated with implementing such a program in the future, according to the report. The OIG reviewed $12 million in Medi-Cal payments for standard power wheelchairs, oxygen systems and oxygen concentrators. Auditors compared payments made by Medi-Cal to those made in certain cities in California as part of Round 1 of competitive bidding.

FAA drafts sleep apnea guidelines

FREDERICK, Md. – The Federal Aviation Administration (FAA) has drafted new guidelines for diagnosing sleep apnea among pilots, according to news reports. Under the new guidelines, announced April 1, pilots will not be disqualified from flying based on body mass index alone. The change came about after opposition from pilots, lawmakers and physicians forced the FAA to put on hold its plans to start testing pilots for sleep apnea in January. The House of Representatives passed a bill in February that would require the FAA to go through a rulemaking process before implementing a sleep policy. The agency had said that was unnecessary because untreated sleep apnea already disqualifies a pilot from flying. Under the draft guidelines, aviation medical examiners (AMEs) will continue to ask questions related to sleep apnea, as they have done since 2009. If a pilot is referred for evaluation for sleep apnea, the examiner will issue a regular medical certificate and the pilot will have 90 days to get an assessment. The pilot can keep flying during that 90-day period and the assessment can be conducted by any physician, not just a sleep specialist, and a sleep test is not required if the doctor feels it is unnecessary.

Separate benefit bill lands more co-sponsors

WASHINGTON – A bill in the House of Representatives to create a separate benefit for complex rehab now has 107 sponsors—67 Democrats and 40 Republicans. Co-sponsors include 17 members of the House Ways and Means Committee and 10 members of the Energy and Commerce Committee, NCART reported in a recent bulletin. “We need to continue to build support and awareness so our bill is in a position to be attached to the next piece of Medicare legislation,” wrote Don Clayback, NCART executive director. A similar bill in the Senate now has 12 co-sponsors, including members of the Finance Committee and the Health, Education, Labor and Pension Committee. Sen. Chuck Schumer, D-N.Y., tried unsuccessfully to have the bill attached to the “doc fix” bill recently passed by Congress.

Region C RAC announces new reviews

WILTON, Conn. – Suction catheters for tracheostomy and speech generating devices and accessories will be subject to prepayment reviews by Connolly, the Region C RAC. For suction catheters, the company will conduct an automated review to evaluate overpayments identified when claims billed for suction catheters were not done in accordance with the billing requirements outlined in local coverage determinations (LCDs). The review of speech generating devices and accessories is a complex review evaluating medical documentation to determine whether items met coverage indications and limitations and/or medical necessity as outlined in the LCD.

Toyota, VMI launch second Star Spangled Salute contest

PHOENIX – Vantage Mobility International (VMI) and Toyota on April 2 announced the launch of the Second Annual Operation Independence Star Spangled Salute contest. Through the online contest, disabled military veterans can win a new Toyota Sienna outfitted with VMI’s Access 360 In-floor Ramp Conversion system. The contest is open through Nov. 9. The name of the randomly selected winner will be announced on Veterans Day.

Incontinence provider has it in the bag

YARMOUTH, Maine – Home Delivered is now offering Tranquility brand incontinence products by the bag. Buying by the bag allows users to determine what product will work best for them without having to buy a whole case, according to a press release. Although it’s more costly to order by the bag, the company believes the convenience outweighs the cost. The mail-order provider offers a full range of adult incontinence products.

Technology to drive growth in HME market

DALLAS – U.S. demand for home medical equipment is forecast to grow 8.2% annually to $12.6 billion in 2018, according to a report by RnRMarketResearch. Underlying growth: advances in technology for portable oxygen concentrators, remote telemedicine systems and home dialysis machines. “Cost saving advantages will promote the increasing substitution of home health care for hospital, ambulatory and nursing home procedures whenever feasible,” the report states. Among HME, remote monitoring and real-time systems based on telemedicine technology will generate the fastest revenue growth, as physicians, hospitals and other medical providers are pressured by health insurers to become accountable for improving patient outcomes and controlling costs, according to the report.

Numotion strengthens presence in Milwaukee

ROCKY HILL, Conn., and ST. LOUIS – Numotion has acquired the mobility division of AccessAbility Home Medical and Rehab, a Milwaukee-based provider of mobility, respiratory and DME. “The sale of our mobility business will allow us to focus on the DME and respiratory product line, in addition to our affiliated company, Access Elevator,” stated Owner Jon Tevz in a press release. As part of the deal, Numotion will pick up the company’s three assistive technology professionals (ATPs) and other experienced support staff. “(This) will allow Numotion to strengthen its relationships with key referral sources throughout the Milwaukee area,” stated Tim Havel, regional vice president, in the release. Numotion has been acquiring a steady stream of mobility companies since it was formed by the merger of ATG Rehab and United Seating and Mobility in January 2013.

Short takes: Brightree, Inogen, Roscoe Medical

Atlanta-basedBrightree has launched Brightree Home Infusion, a new solution to address the clinical, operational and billing needs of home infusion pharmacies. The solution allows pharmacies to use a single, cloud-based platform for orders, inventory, labels, billing, drug utilization and medical tracking. Additionally, pharmacies that also provide HME medications and HME equipment and supplies can now simplify operations and reduce costs by using one sales order in a single, fully integrated system…Goleta, Calif.-based Inogen has been added to the Russell 2000 and Russell 3000 Indexes. The Russell 2000 Index measures the performance of the small-cap segment of the U.S. equity market. It’s a subset of the Russell 3000 and represents about 10% of the total market capitalization of that index…NXT Capital has provided a $78.1 million senior secured facility to fund Roscoe Medical’sacquisition of Carex Health Brands. NXT Capital was the joint lead arranger, sole bookrunner and administrative agent for the transaction.

People in the news: Jan Erickson, Sen. Isakson, Colleen Brabec, Svein Ryan

Jan Erickson, president of Colorado Springs, Colo.-based Janska, has been named Colorado Small Business Person of the Year by the U.S. Small Business Administration. Janska, founded in 2003, is a maker of women’s clothing that enhances dignity. It can be found in more than 900 specialty gift and clothing boutiques, and 10 catalogs in the U.S. and Canada…Sen. Johnny Isakson, R-Ga., gave the keynote address at the National Home Infusion Association’s 2014 Annual Conference and Exposition, March 31-April 3. Isakson told attendees he had a profound appreciation for their work because it allowed his son to recover at home rather than in a hospital in 1989. “As one constituent who had your services save a son’s life, I know how important what you do is,” he said…Colleen Brabec, owner and general manager of Council Bluffs, Iowa-based Mobilis, is the winner of the 2014 MAMES Above and Beyond Award. Winners of the award are recognized for their work going “above and beyond” on a state, regional and/or national level. MAMES commended Brabec for, among other things, hosting a roundtable meeting to educate lawmakers on the negative impact of competitive bidding…Svein Ryan has been appointed to the position of vice president, marketing and development, for SCA’s Personal Care business in North America. Ryan has worked for SCA for 25 years in its personal care business, managing sales teams in Norway, Sweden, Romania, Greece, Austria and Germany.

WASHINGTON – The PMD demo is about to get bigger.

In an April 4 emergency federal register notice, CMS details plans to expand its prior authorization program to 12 new states: Pennsylvania, Ohio, Louisiana, Missouri, Maryland, New Jersey, Indiana, Kentucky, Georgia, Tennessee, Washington and Arizona. 

That will bring the total number of demo states to 19.

“We believe that this demonstration prevents public harm by protecting the Medicare Trust Fund from improper payments made for PMDs that do not comply with Medicare policy and by ensuring that a beneficiary’s medical condition warrants the medical equipment ordered,” the agency stated.

The demo, which requires providers or physicians to submit prior authorization requests to DME MACs for evaluation before an item is delivered or service rendered, has been in place in seven states—California, Texas, Illinois, Michigan, New York, North Carolina and Florida—since September 2012.

As a result of the demo, spending on power mobility devices fell from $11 million in September 2012 to $5 million in June 2013.

In the notice, CMS asks the Office of Management and Budget to review and approve its request by April 18. 

HME News recently reported that, at the behest of the Senate Finance Committee, the industry has drafted language that would expand the demo to all 50 states and would expand it to include all power mobility devices, including Group 3 wheelchairs.

WASHINGTON – As part of the Round 1 of competitive bidding, CMS generally selected DMEPOS suppliers and correctly computed the sampled single payment amounts in accordance with its established procedures and applicable federal requirements, according to a report published today by the Office of Inspector General (OIG).

Specifically, the OIG determined that for 255 of the 266 contract suppliers associated with the sampled single payment amounts reviewed, CMS consistently followed its procedures and applicable federal requirements.

To conduct its investigation, the OIG randomly sampled 100 of the 3,011 established single payment amounts in the Round 1 re-bid program and examined the selection process for the 266 contract suppliers in the sample. It reviewed 63,906 lines of service related to the sample, totaling about $5.1 million paid during the first six months of 2011.

While the overall effect was immaterial, the OIG determined that for 11 of the 266 contract suppliers, CMS did not consistently follow its established procedures and applicable federal requirements, affecting 19 of the 100 sampled single payment amounts. Specifically, CMS awarded contracts to nine suppliers that did not meet financial documentation requirements, and it incorrectly used two suppliers in one single payment computation.

On the basis of its sample, the OIG estimates that CMS paid suppliers $33,704 less than they would have received without any errors, or less than 0.1% of the $113 million paid under the program in the first six months of 2011.

The OIG recommends that CMS follow its established program procedures and applicable federal requirements consistently in evaluating the financial documents of all suppliers; and ensure that all bids are included in the calculation of single payment amounts before offering contracts.

CMS concurred with the OIG’s recommendations.

WASHINGTON – The number of both beneficiaries and DME suppliers declined in Round 1 competitive bidding program areas in 2012, according to a new report issued yesterday by the Government Accountability Office (GAO).

To conduct its study, the GAO compared Medicare claims data from 2011 and 2012 with 2010 for beneficiaries; and compared claims data for 2012 with 2010 for contract and non-contract suppliers. For monitoring purposes, CMS had selected nine “comparator” areas that were demographically similar to the nine Round 1 competitive bidding areas.

Findings

• The GAO found that the number of beneficiaries in the CBAs decreased more in the bid areas compared to the comparator areas. For example, the number of beneficiaries receiving oxygen supplies decreased by about 22% in bid areas vs. 16% in the comparator areas. CMS attributes the decrease to a reduction in inappropriate use.

However, the GAO did state that the termination of The Scooter Store's contract in 2013 could create access issues for beneficiaries seeking repairs in those CBAs.

• The GAO also found that, in general, a small number of contract suppliers had a large portion of market share in the nine CBAs and that the top four contract suppliers generally accounted for a larger proportion of the market, although the top four contract suppliers were not the same in every CBA.

• The total number of DME suppliers and Medicare allowed charges decreased more in the nine bid areas. For example, the number of suppliers with allowed charges of $2,500 or more decreased, on average, 27% in CBAs vs. 5% in the comparator areas.

In conclusion the GAO stated the competitive bidding program does not appear to have impacted beneficiary access to covered items. However, states the report, CMS must continue monitoring the effects of the expansion of the program to 100 areas in July 2013 and of the national mail-order program for diabetes supplies. 

According to CMS, the program saved estimated $400 million in its first two years.

NEW YORK – QMES, a distributor of DME in nine states, has secured a $50 million senior secured credit facility from CIT Corporate Finance, Healthcare.

QMES will use the facility to refinance legacy debt and provide for ongoing working capital needs, according to a press release.

“QMES has an impressive track record of growth having completed 10 acquisitions since 2012 and effectively establishing itself as one of the largest medical equipment home delivery companies on the East Coast," stated William Douglass, managing director and group head of CIT Corporate Finance, Healthcare, a provider of financing and advisory services to small businesses and middle-market companies. “We look forward to building this relationship.”

QMES is a portfolio company of Quadrant Management, a New York-based private equity and restructuring firm. LMI is also a portfolio company of the firm.

QMES distributes medical supplies to patients in Pennsylvania, New Jersey, Connecticut, Delaware, New Hampshire, New York, Massachusetts, Maryland and Rhode Island. It was created in 2012 through various acquisitions.

“CIT clearly understood our sector and was the ideal partner to support us as we looked to evolve our financial structure to reflect to the company we’ve become and position ourselves for the future,” said Luke McGee, chairman and CEO of QMES.

Terms of the deal were not disclosed.

WASHINGTON – A recent report from the Government Accountability Office (GAO) on the Round 1 rebid of competitive bidding “parroted” CMS, say industry stakeholders.

“I think the intent of Congress was that this is an independent agency that would look at competitive bidding and come up with its own conclusions,” said Tom Ryan, president and CEO of AAHomecare. “If you rely on CMS to give you the answers you are going to get the same results. It’s parroting the conclusions of CMS.”

The report, released April 8, reviewed the program’s impact on beneficiaries, and on both contract and non-contract suppliers during the second year of the program. The report found that the number of beneficiaries decreased by about 22% in CBAs vs. 16% in non-bid areas.

“CMS is saying the decline is because there was overutilization,” said John Gallagher, vice president of government relations for The VGM Group. “That’s absolutely wrong. If there’s a 22% decline, beneficiaries are suffering.”

If there’s any reason for such a large decline, say stakeholders, it’s a lack of available providers in those areas. The report also found that the top four contract suppliers generally accounted for a large proportion of market share; and that the number of suppliers with allowed charges of $2,500 or more decreased, on average, 27% in CBAs vs. 5% in non-bid areas.

“The program is minimizing the ability of small providers to do business,” said Cara Bachenheimer, senior vice president of government relations for Invacare.

Another report issued April 8, by the Office of Inspector General (OIG), found that CMS generally complied with bidding rules in the Round 1 rebid. The OIG recommended that the agency follow its established program procedures and applicable federal requirements consistently in evaluating the financial documents of all suppliers; and ensure that all bids are included in the calculation of single payment amounts.

Those conclusions are in line with what the industry has been saying, particularly with regard to financial transparency, said Ryan. 

While neither report provided the shot in the arm that stakeholders would have liked, they say they will push back on CMS’s claims that declines in utilization haven’t harmed beneficiaries.

“Does CMS really understand what’s happening with the decrease?” said Ryan. “We are hearing from case managers, discharge planners and social workers. We know there’s a problem.”

View the full GAO report.

View the full OIG report.

http://www.hmenews.com/article/gao-analyzes-bid-program-s-impact

http://www.hmenews.com/article/oig-weighs-cms-oversight-bid-program

http://www.gao.gov/assets/670/661474.pdf

http://oig.hhs.gov/oas/reports/region5/51200067.pdf

WASHINGTON – Kathleen Sebelius has resigned after serving five years as secretary of the Department of Health and Human Services. President Barack Obama is expected to nominate Sylvia Mathews Burwell, director of the Office of Management and Budget (OMB), to replace Sebelius, news organizations report. The Senate will have to confirm Burwell, who was approved by a 96-0 vote to take the helm at OMB last year. During her tenure at HHS, Sebelius made Medicare fraud prevention a priority. In 2009, Sebelius and Attorney General Eric Holder formed the Health Care Fraud Prevention and Enforcement Action Team (HEAT); and expanded the scope of Strike Force operations. Sebelius’s tenure was marked by heavy criticism of her department’s messy rollout of the Affordable Care Act’s insurance marketplace exchanges.

Consumer-facing campaign kicks off

WASHINGTON – In the first 24 hours after AAHomecare officially launched its “SaveMyMedicalSupplies” campaign with a website and Facebook and twitter pages, it generated 725 letters to Congress. The campaign is designed to educate consumers about how Medicare reform mistakes are impacting their medical needs. The website explains coverage criteria and reform challenges to consumers in a way that’s easy to understand, and empowers them with tools to contact their lawmakers. The campaign is targeted at consumers who have cerebral palsy, diabetes, multiple sclerosis, spina bifida, spinal cord injury and other medical conditions. AAHomecare is asking providers and manufacturers to follow SaveMyMedicalSupplies on Facebook and twitter; share or retweet posts from the campaign on their social media pages; and share links to condition-specific pages from the website and social media in their newsletters, blogs and other consumer-facing online resources.

QMES repositions with $50M in financing

NEW YORK – QMES, a distributor of DME in nine states, has secured a $50 million senior secured credit facility from CIT Corporate Finance, Healthcare. QMES will use the facility to refinance legacy debt and provide for ongoing working capital needs, according to a press release. “QMES has an impressive track record of growth having completed 10 acquisitions since 2012 and effectively establishing itself as one of the largest medical equipment home delivery companies on the East Coast," stated William Douglass, managing director and group head of CIT Corporate Finance, Healthcare, a provider of financing and advisory services to small businesses and middle-market companies. QMES is a portfolio company of Quadrant Management, a New York-based private equity and restructuring firm. LMI is also a portfolio company of the firm. QMES distributes medical supplies to patients in Pennsylvania, New Jersey, Connecticut, Delaware, New Hampshire, New York, Massachusetts, Maryland and Rhode Island. It was created in 2012 through various acquisitions. Terms of the deal were not disclosed.

Medicare Advantage plans avoid chopping block

WASHINGTON – The Obama administration has once again reversed its position on cutting reimbursement for Medicare Advantage (MA) plans. CMS announced this week that reimbursement for MA plans in 2015 would rise, on average, 0.4%, according to news reports. Obama had previously proposed a reduction of, on average, 1.9%. The administration did a similar about-face last year. It proposed a cut of 2.3% for 2014 and ended up increasing reimbursement by 3.3%. Insurers, along with a broad swath of lawmakers, lobbied the government to keep reimbursement level.

HHS releases physician pay data

WASHINGTON – The Department of Health and Human Services has released data on the services physicians provide to Medicare beneficiaries and how much they are paid. In the release is data from more than 880,000 healthcare providers who received $77 billion in Medicare payments in 2012 under the Part B fee-for-service program, according to an April 9 release. “Data transparency is a key aspect of transformation of the healthcare delivery system,” said CMS administrator Marilyn Tavenner. “While there’s more work ahead, this data release will help beneficiaries and consumers better understand how care is delivered through the Medicare program.”

Maryland streamlines DME licensure requirements

ANNAPOLIS, Md. – Maryland lawmakers passed a pair of bills to remove the pharmacy licensure requirement for DME, the Maryland-National Capital Homecare Association (MNCHA) announced April 8. DME providers in the state are licensed by the Office of Healthcare Quality as residential service agencies, but were also subject to pharmacy licensure requirements by the Maryland Board of Pharmacy, according to a release. In 2013, DME licensing fees increased from $500 per year to $3,000 every three years; and providers were required to pay pharmacy licensing fees of $700 per year for the first year and $600 every year thereafter; and have a full-time pharmacist on staff. “Durable medical equipment providers across the country are being systematically dismantled by the CMS competitive bidding program, claims audits and appeal delays,” said MNCHA president Gwen Turner. “Streamlined licensure allows providers to focus on giving the highest quality equipment and service to their patients instead of filling out state-mandated paperwork.” The law is set to take effect June 1. 

Lawmaker tours GF manufacturing facility

ATLANTA – GF Health Products hosted a delegation led by U.S. Rep. Tom Petri, R-Wis., at its manufacturing facility in Fond du Lac, Wis., on March 31. Petri toured the newly expanded facility and spoke with some of its 125-plus employees. “In our discussions, Rep. Petri said he was excited to see the investment GF has made in high-tech manufacturing equipment and the increase in employment that has taken place at our Fond du Lac facility,” stated Ken Spett, CEO of GF, in a press release. Petri was concerned about the impact of the medical device tax and other regulations on GF’s growth. “We assured him that we are committed to increasing our investment in manufacturing in the United States,” Spett stated.

Vendor short takes: ARI to ring NASDAQ bell

Milwaukee-based ARI Network Services, provider of data-driven software tools and marketing services, will ring the NASDAQ Stock Market’s closing bell April 14 … Minneapolis-based Ottobock will relocate its fabrication and service operations from Minneapolis to a 52,700-square-foot facility in Salt Lake City, it announced recently. In March, the medical device manufacturer announced it would relocate its North America distribution operations to Louisville, Ky. … Chattanooga, Tenn.–based Allied Management Solutions, an HME management and consulting company, has signed an agreement with Amerinet to provide a variety of solutions to its members. Amerinet partners with healthcare facilities to help them maximize efficiency, trim overall costs and provide unique revenue-generating opportunities.

Provider short takes: VMI, Burmans, Med-Care

Phoenix-based Vantage Mobility International (VMI) has been named an Official Vehicle Mobility Partner of AMVETS, an organization that supports veterans and active-duty military personnel in procuring earned entitlements, according to a release … Burmans Medical Supplies has launched an outreach campaign aimed at the growing number of catheter users. The Brookhaven, Pa.-based Burmans offers discreet service and carries all the leading product brands … Med-Care Diabetic and Medical Supplies has launched its first-ever national television advertising campaign, according to a release. The campaign will air on ABC, CBS and CNN. The Boca-Raton, Fla.-based provider is a national mail-order contract supplier for Medicare.

WASHINGTON – Kathleen Sebelius has resigned after serving five years as secretary of the Department of Health and Human Services.

President Barack Obama is expected to nominate Sylvia Mathews Burwell, director of the Office of Management and Budget (OMB), to replace Sebelius, news organizations report. 

The Senate will have to confirm Burwell, who was approved by a 96-0 vote to take the helm at OMB last year. 

Should she be confirmed, Burwell will lead preparation for the next open-enrollment period for the nation’s health insurance exchanges and the delayed employer mandate, news reports say.

During her tenure at HHS, Sebelius made Medicare fraud prevention a priority. In 2009, Sebelius and Attorney General Eric Holder formed the Health Care Fraud Prevention and Enforcement Action Team (HEAT); and expanded the scope of Strike Force operations.

Sebelius’s tenure was marked by heavy criticism of her department’s messy rollout of the Affordable Care Act’s insurance marketplace exchanges.

WASHINGTON – The Department of Justice (DOJ) has intervened in a False Claims Act lawsuit against Orbit Medical and Jake Kilgore for allegedly altering and forging physician prescriptions and supporting documentation for power wheelchairs and accessories.

On Oct. 23, 2013, a federal grand jury in Utah indicted Kilgore, former vice president and sales manager, on three counts of healthcare fraud, three counts of false statements related to health care and three counts of wire fraud.

“The government is intervening in this matter seeking to restore Medicare trust funds taken through the alleged use of falsified records and fraudulent billings, among other things,” said U.S. Attorney for the District of Utah David Barlow in a release. “Health care fraud is aggressively pursued in Utah. Every effort is made to restore taxpayers’ dollars taken through fraudulent conduct.”

The DOJ’s intervention illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT). The initiative is a partnership between the DOJ and the Department of Health and Human Services.

The lawsuit alleges that Orbit Medical sales reps, at Kilgore’s direction and encouragement, knowingly altered physician prescriptions and supporting documentation to get the company’s power wheelchair and accessory claims paid by Medicare. In particular, it alleges that the sales reps created documents to falsely establish that physicians examined beneficiaries in person; changed prescriptions to falsely establish medical necessity; created or altered chart notes and other documents to falsely establish medical necessity; and forged physician signatures on prescriptions and chart notes and added facsimile stamps to supporting documentation.

The allegations against Orbit Medical and Kilgore were filed under the False Claims Act by two former employees, Dustin Clyde and Tyler Jackson. Under the act, private parties can sue for false claims on behalf of the government and share in any recovery. The act also permits the government to intervene in the lawsuit, as it’s doing here.

WASHINGTON – CMS is moving forward with fingerprint-based background checks for certain DME and home health and hospice providers.

The agency announced in a Medlearn Matters Article this week that it will phase in implementation of background checks for high-risk providers starting this year.

“The fingerprint-based background checks will be used to detect bad actors who are attempting to enroll in the Medicare program and to remove those currently enrolled,” CMS states in the article.

Once fully implemented, the background checks will be completed on all individuals with a 5% or greater ownership interest in a provider that falls under the high-risk category. This category applies to DME and home health and hospice providers who are newly enrolling in Medicare, and those who have been elevated to the category in accordance with enrollment screening regulations.

The article states that affected providers will receive notification of the fingerprint requirements from their DME MAC. The letter will include contact information for the fingerprint background check contractor (FBBC). Individuals will have 30 days from the date of the letter to be fingerprinted and the FBBC will provide at least three locations to be fingerprinted. Individuals are responsible for the costs of the background check, which may vary by location.

A provision in the Affordable Care Act called for enhanced screening of providers to prevent fraud and abuse. CMS published a final rule setting the screening levels in 2011.

CMS was expected to select a contractor for the program in February of this year.

WATERLOO, Iowa – A new deal will help VGM members respond to audits using OmniSYS solutions at a discounted rate, the companies announced April 17.

“Audits are the most critical problem facing our members today, and responding to them is time consuming and expensive,” said Ron Bendell, president of VGM and Associates, in a release. “VGM is happy to partner with a company that can handle the process from the initial notice up through the administrative law judge level, and do it in an economical way.”

OmniSys’s OmniGUARD is a Web-based interactive application that allows providers to upload audit demand letters and pre-pay denials. Audit specialists then collect medical necessity documentation, submit audit packages and monitor responses for providers.

The specialists also educate physicians and patients when paperwork fails to conform to guidelines, according to the release.

“OmniSYS’s Web-based compliance solutions are designed to take the burden off the supplier and manage the entire audit and documentation collection process, improving payment rates and increasing net cash flow,” said Tricia Fringer, OmniSYS president and CEO.

WASHINGTON – HME providers who want to do business with Medicare will have to navigate through another layer of bureaucracy starting some time this year.

CMS will begin phasing in fingerprint-based background checks for HME and home health providers in 2014, the agency announced in a MLN Matters article published this week.

“Apart from the inconvenience of being fingerprinted, think of all the new opportunities for mistakes and delays from CMS and this new contractor,” said healthcare attorney Elizabeth Hogue. “How unfair is it that we are characterized this way.” 

CMS will first require fingerprinting for newly enrolling and other high-risk providers. Eventually, however, it will require fingerprinting for all individuals with a 5% or greater ownership in an HME or home health company.

While it will take time for CMS to ramp up the program, providers may receive a notification letter from their Medicare Administrative Contractor (MAC) to get fingerprinted sooner than they think. Attorneys point out that providers may be thrown into the fire when they re-enroll with the National Supplier Clearinghouse (NSC), something they have to do every three years.

“In theory, a provider could have to do this in no more than three years,” said Neil Caesar, president of the Health Law Center.

New details on the program include: Providers will have 30 days from the date of the notification letter to be fingerprinted; once they receive a letter, providers must contact the Fingerprint-Based Background Check Contractor (FBBC) to get the names of three places where they can get fingerprinted; and providers will incur the cost of having the fingerprints taken.

The process may be a logistical challenge for some providers if a similar requirement already implemented by Florida’s Medicaid program is any indication, attorneys say.

“From my experience in Florida, when helping a rural provider or an out-of-state provider who doesn’t have as easy access to these outfits, it is nearly impossible to do this compliantly,” said Todd Moody, a healthcare attorney with Brown & Fortunato. “I’ve submitted five different cards for the same person and haven’t been able to get it through. I see this as being a challenge.”

Other details: Once the process is complete, the fingerprints will be forwarded to the FBI for processing; within 24 hours, the FBI will compile a background history and will share the results with the FBBC; the FBBC will assess the law enforcement data provided and provide a “fitness recommendation” to CMS; CMS will assess the recommendation and make a final determination.

CMS says it will rely on its existing authority to deny enrollment applications and revoke Medicare billing privileges if an individual has submitted an enrollment application that contains false or misleading information.

“I rarely say this, because it sounds self-serving, but when it comes to re-enrollment, providers need to seek legal counsel to review their application and make sure it’s completed correctly,” Hogue said. “It’s gotten so complex now.”

YARMOUTH, Maine – An overwhelming majority of respondents to a recent HME Newspoll (91%) said lower reimbursement has driven them to cut back on services over the last year.

The area where they’ve cut the most: deliveries (44%).

“(We) simply can’t afford to send a service technician to a patient’s home for free,” said Roger Lichty of Rockford, Ill.-based RRTS Mobility Connection.

Instead, companies like Granada Hills, Ca.-based Wishing U Well Medical ask patients to pick up supplies or drop ship orders to them.

“Most people understand,” wrote Bruce Sandler, president and CEO.

That’s not the case for everyone: 75 of the 116 respondents to the poll reported unhappy patients.

“Because we have always delivered equipment and patients were used to that service, they are very angry that they now need to pick up equipment,” wrote one respondent.

Some respondents report that, over time, patients become accustomed to fewer services.

“We made changes beginning three years ago with once-a-month oxygen cylinder deliveries and only visiting our oxygen patients in their homes once a year,” wrote one respondent. “A lot of patients were angry, but after six months, it was routine for everyone.”

Deliveries aren’t the only service on the chopping block. Twenty percent of those cutting services said they have reduced patient outreach, and 13% said they conduct fewer maintenance and repair calls.

“We will soon be limiting the amount of monthly refills,” said Rick Wilson, a provider in Woodland Hills, Calif. “We are charging service call fees for any capped equipment. No more donation equipment to the non-insured. After the 60th month, we are moving patients off service ASAP.”

HONOLULU – CMS has awarded new competitive bidding contracts to two local providers in Hawaii: Aloha Medical and American Home Care Systems. To date, just 13 of the 97 providers who accepted contracts as part of Round 2 of competitive bidding were located in Hawaii. The move is in response to concerns raised by the Hawaiian congressional delegation and the Healthcare Association of Hawaii (HAH) about decreased access to equipment and services. “We appreciate that CMS has taken a positive step to help to remove barriers to access to care in Hawaii,” said George Greene, HAH president and CEO, in a recent bulletin from AAHomecare. “However, the logistics and cost of business in the middle of the Pacific Ocean still make the DME competitive bidding program unsustainable in this island state.” With no same-day or overnight express shipping, it takes mainland contract providers at least two to four days to get most equipment and replacement parts and four to eight weeks to get hospital beds and wheelchairs. Complicating matters further: Mainland contract providers are unable to subcontract because prices are below the cost of supplying the equipment once shipping is factored in, according to the bulletin.

QIC overturns denials

WATERLOO, Iowa – Seventy-percent of the denials that U.S. Rehab’s Peggy Walker sent to C2C Solutions for review following a forum hosted by the Office of Medicare Hearings and Appeals (OMHA) have been overturned fully or partially in favor of providers. C2C Solutions is a Qualified Independent Contractor (QIC) that handles the second level of appeals. “C2C Solutions was willing to look over the denials that were made in error,” Walker said. “The errors were technical errors that were reviewed inappropriately.” Walker encourages providers that have had claims denied for technical reasons to submit them to her for review and possible reopening using this form.

DHS strengthens N.J. foothold

HARRISBURG, Pa. – Dynamic Healthcare Services (DHS) has made its third buy of the year: Kenvil, N.J.-based RespaTech, a full-line provider of HME and respiratory equipment. The facility and its operations will be folded into Reliable Medical, which DHS acquired in February. "RespaTech's presence in the New Jersey market combined with Reliable Medical's reach in the area, along with the Northern New Jersey Metro CBA contract that DHS already had in place, gives us an amazing foothold across the state,” said Michael Holloway, president of GMH Ventures, the private equity firm backing DHS. In addition to Reliable Medical, DHS acquired Clarion, Pa.-based Progressive Home Medical Equipment in January. RespaTech owner David Lasko will join DHS and manage the Kenvil office.

OIG analysis doesn’t bode well for F2F requirement

WASHINGTON – Thirty-two percent of home health claims do not meet face-to-face requirements, according to a study released by the Office of Inspector General (OIG). As a result, $2 billion in payments should not have been made. The report also found that physicians inconsistently completed the narrative portion of the face-to-face documentation and that CMS oversight of the program is minimal. The OIG recommended, and CMS concurred, that CMS should require a standardized form to ensure that physicians include all elements required for the face-to-face documentation; develop a specific strategy to communicate directly with physicians about the face-to-face requirement; and develop other oversight mechanisms for the requirement.

Joerns, RecoverCare merge

LOUISVILLE, Ky., and CHARLOTTE, N.C. – Joerns Healthcare and RecoverCare have signed a definitive agreement to combine their companies in a merger-of-equals transaction. The merger will create one of the leading healthcare equipment providers across the continuum of care, according to a press release. Joerns and RecoverCare, which are both owned by private equity firms—Quad-C Management and Aurora Capital, respectively—expect the transaction to close in the second quarter. Joerns is a manufacturer and rental provider of bed systems, therapeutic support surfaces, safe patient-handling equipment and wound management services to the post-acute healthcare market. RecoverCare is a distributor of therapeutic support surfaces and bariatric, wound care and safe patient-handling equipment and solutions across the continuum of care, including acute-care hospitals, skilled nursing facilities, rehabilitation facilities and hospice facilities.

VGM uses OmniSYS to fight audits

WATERLOO, Iowa – A new deal will help VGM members respond to audits using OmniSYS solutions at a discounted rate, the companies announced April 17. “Audits are the most critical problem facing our members today, and responding to them is time consuming and expensive,” said Ron Bendell, president of VGM and Associates, in a release. “VGM is happy to partner with a company that can handle the process from the initial notice up through the administrative law judge level, and do it in an economical way.” OmniSys’s OmniGUARD is a Web-based interactive application that allows providers to upload audit demand letters and pre-pay denials. Audit specialists then collect medical necessity documentation, submit audit packages and monitor responses for providers. The specialists also educate physicians and patients when paperwork fails to conform to guidelines, according to the release. “OmniSYS’s Web-based compliance solutions are designed to take the burden off the supplier and manage the entire audit and documentation collection process, improving payment rates and increasing net cash flow,” said Tricia Fringer, OmniSYS president and CEO.

Gov’t to Orbit Medical: We want our money back

WASHINGTON – The Department of Justice (DOJ) has intervened in a False Claims Act lawsuit against Orbit Medical and Jake Kilgore for allegedly altering and forging physician prescriptions and supporting documentation for power wheelchairs and accessories. On Oct. 23, 2013, a federal grand jury in Utah indicted Kilgore, former vice president and sales manager, on three counts of healthcare fraud, three counts of false statements related to health care and three counts of wire fraud. “The government is intervening in this matter seeking to restore Medicare trust funds taken through the alleged use of falsified records and fraudulent billings, among other things,” said U.S. Attorney for the District of Utah David Barlow in a release. The DOJ’s intervention illustrates the government’s emphasis on combating health care fraud and marks another achievement for the Health Care Fraud Prevention and Enforcement Action Team (HEAT). The initiative is a partnership between the DOJ and the Department of Health and Human Services. The lawsuit alleges that Orbit Medical sales reps, at Kilgore’s direction and encouragement, knowingly altered physician prescriptions and supporting documentation to get the company’s power wheelchair and accessory claims paid by Medicare. The allegations against Orbit Medical and Kilgore were filed under the False Claims Act by two former employees, Dustin Clyde and Tyler Jackson. Under the act, private parties can sue for false claims on behalf of the government and share in any recovery. The act also permits the government to intervene in the lawsuit, as it’s doing here.

PFQC: Is the GAO saying patients are lying?

WASHINGTON – Consumer advocates question the conclusions of a recent Government Accountability Office (GAO) report that stated Round 1 of the competitive bidding program “did not appear to have adversely affected beneficiary access.” “I speak with Medicare beneficiaries daily who are frustrated and desperate because they are unable to get help,” said Kelly Turner, advocacy director at People for Quality Care (PFQC). “But, basically, this report says they are lying.” More than 3,000 complaints have been filed with PFQC’s Medicare Beneficiary Hotline since June 2013, according to the organization. PFQC says the GAO report was flawed for a number of reasons: it derived conclusions from CMS and its contractors; and its numbers are skewed due to CMS’s definition of a complaint versus an inquiry and the agency’s use of outdated survey data.

Sleep Restfully relocates

HOUSTON – Sleep Restfully will move to a new facility effective April 21 to accommodate growing shipment, storage and manpower demands. “We are pleased about our new location because it offers opportunities for our employees to attract new customers and provide them with even more services and quicker shipment of their orders,” said Charles Goldberg, president and CEO, in a release. The company’s outgoing shipments grew 34% in 2013 compared to 2012. Sleep Restfully distributes sleep therapy and oxygen therapy devices and accessories.

Prism Medical sells UK operations

TORONTO – Prism Medical has sold all shares of its UK division for C$54.9 million, the company recently announced. “As a result of the sale of the UK operations, we expect to considerably reduce our administrative expenses and focus our human and financial capital on the growing North American market for our products and services,” said Andy McIntyre, executive chairman and CEO. Prism’s North American operations generated revenues of more than C$35.3 million in fiscal 2013, he said. The company’s management sees opportunities for organic growth and acquisitions in North America. In conjunction with the sale, Prism renegotiated senior credit facilities, with overall credit lines decreasing as a result of lower assets, according to a release.

Wright & Filippis names new execs

DETROIT – Wright & Filippis has beefed up its management team to reflect its commitment to increased growth, improved efficiency and more effective use of technology. Robert Barrow has been named vice president of operations. Previously, he was CEO of Doctors Hospital of Michigan. Paul Turek has been named director of information technology; Mark Burns has been named vice president of sales; and Steve Filippis, former vice president of facility operations, has been named vice president of mergers and acquisitions. “We see a significant amount of new and emerging opportunities in the marketplace, and believe it is time to strengthen our leadership team,” statedCEO Anthony Filippis in a press release. “While change is going to be the one constant in health care for the foreseeable future, we believe these individuals will put us in a position of advantage.”

Diabetes rates rise

YARMOUTH, Maine – Diabetes is on the rise, but so is control of the condition, according to a new study. Between 1988 and 2010, rates of diagnosed diabetes rose from 6% to 10%, and pre-diabetes rose from 6% to 12%, according to a report published April 14 in the Annals of Internal Medicine. Overall, mean HbA1c levels rose from 5.25% to 5.36%, but those levels stayed the same in adults with normal body weight, blood pressure and lipid levels. Still, nearly 40% of patients aren’t hitting their glycemic targets, especially minority groups, according to the report.

Better Rest celebrates Sleep Apnea Awareness Day

BOSTON – Better Rest Solutions will donate $5 to the American Sleep Apnea Association (ASAA) for every SoClean 2 sold between April 15 to May 15, it announced this week. The fundraising is in recognition of Sleep Apnea Awareness Day, April 18. SoClean 2 allows CPAP users to naturally clean and sanitize their CPAP equipment. "We understand first hand the health issues associated with sleep apnea, as many of us at Better Rest Solutions have dealt with the effects of sleep apnea ourselves either directly or indirectly,” said Mike Schmidt, president of Better Rest Solutions. “We are excited to contribute to the ASAA in recognition of Sleep Apnea Awareness Day.” More than 18 million Americans have been diagnosed with sleep apnea.

ResMed snags two design awards

SAN DIEGO – ResMed has won two Red Dot Product Design Awards for 2014—one for its AirFit P10 nasal pillows mask and one for its soon-to-be-launched Astral 150 life support ventilator. ResMed was also recognized in 2010 for its S9 Series. As part of the competition, manufacturers, designers and architects from 53 counties submitted 4,815 entries. Only 1,120 were recognized. “ResMed has a proud 25-year history of delivering innovative solutions with the patient’s comfort and well-being in mind,” stated Mick Farrell, ResMed CEO, in the release. “We remain focused on three key goals: improving patient quality of life, preventing progression of chronic diseases, and lowering total healthcare costs.”

Weeks provides social media marketing services

MELBOURNE, Fla. – Wallace Weeks is back. The consultant, who left the HME industry four years ago to build a business around photography, has expanded his services to include managing social media marketing for HME providers. Image Centric Media’s “HME Social”* performs social media marketing tasks for HME providers, rather than consulting with them on what they should do. “Many small and mid-size businesses have realized that social media marketing is now essential, yet they lack the time and skill for an effective program,” the company states in a press release. So what’s photography, the company’s bread and butter, have to do with social media? Weeks says photos and video are important sources of content for effective social media marketing.

Short takes

The Braff Group was the No. 1 ranked healthcare M&A advisor in 2013 based on transactions completed, according to Thomson Reuters. The Braff Group completed 23 deals last year. This is the third consecutive year that The Braff Group has earned the No. 1 ranking…ARI Network Services has been named the preferred website vendor for a leading HME wholesale distributor. Per the agreement, ARI will offer the distributor’s network of 8,000 independent providers access to its eCommerce websites…Breathe Technologies has been granted its fifth clearance by the U.S. Food and Drug Administration (FDA) for its Non-Invasive Open Ventilation (NIOV) system. The clearance allows the product to be used with compressed air supply for non-oxygen dependent patients. The previous clearances allowed it to be used for home and institutional use…Sunrise Medical has posted a new corporate video to its website. The video “reveals the recipe for success in achieving its mission” of “improving people’s lives.”

People in the news

Ottobock has promoted John Spillar to market manager for lower extremity prosthetics. He was previously the technical orthopedics territory sales representative for South Texas. He has been with the company since December 2010…HomeCare Connect, a national workers compensation company that manages home health services and home medical equipment and supplies, has named Timothy Bates vice president of operations. In this newly created position, Bates will oversee the company’s HME clinical call center and home modifications operations.

SAN DIEGO and ELYRIA, Ohio – Recently released earnings from ResMed and Invacare are a mixed bag, with the former posting small gains and the latter stumbling.

ResMed

ResMed’s $397.8 million in revenues for the third quarter ended March 31 is a 4% increase over the same period last year. Net income was $90 million, a 6% increase.

Revenues in the Americas, however, were flat at $216.1 million for the third quarter this year compared to $215.2 million for the same quarter last year. 

For the nine months ended March 31, 2014, ResMed’s revenues were $1.139 billion, a 4% increase over the same period last year. Net income was $275.5 million, a 10% increase.

Invacare

Meanwhile, Invacare’s consent decree with the U.S. Food and Drug Administration continues to constrain its performance, according to CEO Gerald Blouch. 

Net sales for the first quarter ended March 31, 2014, decreased 6.7% to $309.1 million versus $331.4 million for the same period last year. The largest decline in net sales was in the North America/HME segment, where sales fell 15% to $129.1 million versus $151.9 million for the same period last year.

Sales of products manufactured at the Taylor Street facility, where activities have been limited due to the consent decree, fell from $17 million in the first quarter of 2013 to $9.5 million for the first quarter of 2014. 

Invacare continues to work with third-party auditors to complete a third and final audit, but it cannot anticipate when the audit will be complete.

ORLANDO, Fla. – Though Executive Director Liz Moran has lived in the state many years, the Medical Equipment Suppliers Association (MESA) has only recently expanded its coverage area to include Florida. 

The expansion followed requests from several Florida providers who told her they felt underserved by existing associations, said Moran.

“There’s a need, and I think MESA can fill that need,” she said. “I’m really very gratified by the response we’ve gotten.” 

This is not the first time another association has popped up in the Sunshine State: In 2009, a group of providers launched the Florida Alliance of Home Care Services (FAHCS), in response to what they called “a distinct lack of leadership” in their state.

The state’s other association, the Florida Association of Medical Equipment Services (FAMES), was founded in 1982 and restructured in 2009.

Beth Bowen, executive director of FAHCS since July 2013, said the association is working hard to build membership and provide benefits, advocacy, communication and education.

The implementation date for ICD-10 may have been delayed until at least Oct. 1, 2015, but the transition to the new code set, when it does happen, will still likely muck up the process for HME, industry consultants say.

The biggest misconception that providers have about ICD-10, they say: that there will always be an easy, one-to-one transition from ICD-9 to ICD-10.

“If we think we can just pick a code in the crosswalk, we can’t,” said Sarah Hanna, president of ECS Billing & Consulting North. “It will be important to get the appropriate code from the physician, because down the road, in an audit, they’re going to request medical records to back up that ICD-10 code.”

There won’t always be a direct crosswalk, stakeholders say, because in ICD-9 there are many unspecified codes, while in ICD-10 the codes are more specific and diagnosis-driven.

The transition could prove particularly tricky for capped-rental and resupply items, stakeholders say.

“You’re definitely going to want to work out the codes for rentals (early in the process), so those claims can keep going out without a holding pattern,” Hanna said.

Like with many documentation changes, providers will be at the mercy of their physician referral sources in many ways, stakeholders say.

“We have to prepare for it, but we’re not in control,” said Kelly Wolfe, CEO of Regency Billing and Consulting. “If they’re not trained on it, it’s another thing on top of the list of things that we have to train them on.”

Unfortunately, the early buzz is that physicians won’t be ready for the transition.

“Remember PECOS?” asked Mary Ellen Conway, president of Capital Healthcare Group. “Physicians didn’t know anything about that, to the point where it kept getting delayed.”

There are things that providers can do to make the transition smoother, stakeholders say. First, they should make sure their software vendors are prepared.

Second, providers should come up with a plan to determine how the transition will affect their operations, including the referral process, revenue cycle management, and CMNs and claim forms, Conway says.

Third, providers should be asking their referral sources if they can include both the ICD-9 and ICD-10 codes on claims.

Calling it a sign of the times, three state associations have merged to form a new regional association.

The Great Lakes Home Medical Services Association is comprised of the memberships of the Association of Indiana Home Medical Equipment Services (AIHMES), the Illinois Association for Medical Equipment Services (AIMES), and the Michigan Independent Providers Association (MIPA).

“Because of the contraction of the membership base, trying to get a critical mass to be effective and to get things done is tough,” said George Kucka, a former executive director of AIHMES and secretary of the new association. “With three states coming together, it hopefully will give us some resources to fight on a national level better.”

Both AIHMES and IAMES have seen membership declines over the past several years. AIHMES has gone from a high of about 115 members in the early 90s to about 20 members. IAMES currently has about 40 members, down from a high of about 115 members. 

MIPA, a relative newcomer, has struggled to grow, says Tim Hatt, vice chairman. The association formed in 2010 when several providers split off from an existing association because they wanted to focus solely on DME issues.

“We raised awareness and highlighted issues of an HME nature,” he said.

The Great Lakes association plans to tackle a variety of issues, both national and local, says Dave Doubek, former treasurer of IAMES, who will assume the same role at Great Lakes.

“There are some individual state issues that can be handled by committees and the bigger issues are certainly global,” he said.

The Great Lakes association plans to hold its inaugural conference May 20-21, in Tinley Park, Ill. Kam Yuricich, who has provided administrative services for both IAMES and AIHMES, will serve as executive director of the new association. She will also retain her role as executive director of the Ohio Association of Medical Equipment Services.