The SADMERC also announced that the HCPCS Helpline would not be available from 11 a.m. CT Aug. 15 to 8:30 a.m. CT Aug. 18.

Air Products Looks to Sell U.S. Healthcare
LEHIGH VALLEY, Pa.--Air Products has announced plans to sell its U.S. Healthcare business, which operates in over 80 locations, has approximately 1,700 employees and serves 120,000 patients mainly throughout the eastern half of the country.

The company will report the business as a discontinued operation beginning in the fiscal fourth quarter but will continue to operate and serve patients until it is transitioned to a new owner, according to a statement issued Tuesday.

Although a number of actions were implemented in 2007 to improve U.S. Healthcare’s performance--including changes in management, a product and service offering simplification program and other measures to drive earnings growth and improve profitability--the business continued to underperform, Air Products said. As a result, in April, the company disclosed that it was evaluating options for the business.

Based on a review of the market and competitive conditions, the company said it had determined U.S. Healthcare no longer fits its business portfolio. At its July meeting, the company’s board of directors authorized management to pursue the sale of the business, and the company is in discussions with potential buyers.

“Unfortunately, despite progress in a number of areas, the U.S. business is still not meeting expectations. At this time, we believe the decision to sell this business is in the best interest of our shareholders. This in no way affects our health care operations outside of the U.S, which continue to perform well and remain a core component of our strategy moving forward,” said Chairman, President and CEO John E. McGlade.

Air Products said it has reached a preliminary agreement to sell its U.S. Healthcare businesses in the metropolitan New York area and in New Jersey, including its A&J Care locations in Glendale and Peekskill, N.Y., and its COPD Services locations in Runnemede, Cape May Courthouse and Cedar Grove, N.J. This sale is expected to be completed by the end of the fiscal year.

Air Products has been in the U.S. health care market since October 2002 when it acquired American Homecare Supply. The company subsequently made additional acquisitions--including its 2004 purchase of Chicago area independent Ultra Care, then one of the largest privately held home respiratory and infusion companies in the country with more than $30 million in sales--growing its U.S. sales to $271 million in fiscal 2007.

Worldwide, Air Products operates in industrial, energy, technology and health care markets in mroe than 40 countries and has annual revenues of $10 billion.

A Few More Details Following Round One Delay
WASHINGTON--Last week the HHS Office of Inspector General assured Medicare providers they will not risk sanctions if they do not collect retroactive fee increases from beneficiaries because of payment changes under the Medicare Improvements for Patients and Providers Act of 2008, or MIPPA.

In a policy statement issued Thursday, the OIG said Medicare providers, practitioners and suppliers affected by retroactive increases in payment rates mandated by the new law “will not be subject to OIG administrative sanctions if they waive retroactive beneficiary cost-sharing amounts attributable to those increased payment rates, subject to the conditions noted in the policy statement.”

Under MIPPA--which halted DMEPOS competitive bidding July 15 and reinstated the higher reimbursement rates that had been in effect before the bid program started July 1--CMS had said that beneficiary liability for cost-sharing also could increase retroactively.

The federal anti-kickback statute normally prohibits Medicare suppliers from waiving beneficiary cost-sharing amounts, and the OIG can levy civil monetary penalties and exclude providers from Medicare for violating the law. But according to the OIG statement, providers who waive beneficiaries’ retroactive liability due to payment increases resulting from MIPPA won’t be subject to administrative sanctions.

In a footnote, the policy noted that although MIPPA was enacted on July 15, "as a practical matter, the revised payment rates will take time to be implemented by CMS (or the relevant contractors and intermediaries). We are informed by CMS that the exact implementation dates may vary by benefit, contractor and intermediary. Until such time as the new payment rates are implemented, some providers may continue to calculate beneficiary cost-sharing obligations based on the prior, temporary payment rates, and the beneficiaries may pay, or be billed for, a lower amount than they actually owe under MIPPA."

The statement also noted that it applies only to providers in the 10 competitive bidding areas, "and then only to beneficiary liability related to the specific items to which competitive bidding would have applied."

The OIG also cautioned that “this policy statement applies only to retroactive beneficiary liability, which is the increase in the beneficiaries’ cost-sharing obligation attributable to the increase in payment rates under MIPPA. This policy does not apply to waivers of beneficiary cost-sharing amounts that were calculated using the lower payment rates temporarily in effect since July 1, 2008.”

The OIG advised that waiving retroactive beneficiary liability could not be “conditional in any manner of the provision of future items, supplies or services.”

In addition, the OIG said, "nothing in this policy statement requires providers to waive retroactive beneficiary liability."

To view the policy statement, click here for a PDF.

In other information related to MIPPA and the delay of competitive bidding:

--For the 10 areas where competitive bidding was initiated, CMS said it will begin processing all incoming claims under standard fee-for-service rules no later than today (July 28). Any claims that were held will be processed no later than Aug. 4. “To the extent possible,” an agency notice said, “CMS will also automatically reprocess claims that were paid under the competitive bidding program and those claims denied based solely due to DMEPOS competitive bidding rules.

“Note that in some instances suppliers will need to alert the contractor to claims that should be adjusted,” CMS said.

--CMS has also issued an MLN Matters article (SE0826) containing a compilation of messages that were issued on July 16 regarding MIPPA. Titled “Important Information on the New Medicare Law – The Medicare Improvements for Patients and Providers Act of 2008,” you can download a PDF of the article by clicking here.

Bid Deadlines Are Dead, but Accreditation Moves Ahead
ATLANTA--With the passage of the Medicare Improvements for Patients and Providers Act of 2008, accreditation deadlines for round two of competitive bidding have been discarded, but CMS' DMEPOS accrediting bodies are still rallying behind the cry: “Don't wait! Apply now!”

Tom Cesar, president of the Accreditation Commission for Health Care, one of CMS' 10 approved accreditors, said his organization has no intention of slowing its push toward the still-in-effect universal accreditation deadline of Sept. 30, 2009.

“We're not changing our dates,” Cesar said. “We have too many companies coming in to put them off. We want to go ahead with the process. Just because competitive bidding has been put off, the Sept. 30 [2009] deadline stands. We don't want to have a bottleneck at the last minute.”

Had the bidding program not been delayed, providers participating in round two would have had to apply for accreditation by July 21 in order to submit a bid, and would have had to be accredited by Jan. 14, 2009, in order to be considered for a contract. (See HomeCare Monday, July 21.)

According to Sherry Hedrick, director of clinical compliance and accreditation for ACHC, “We actually planned ahead and set our own deadline for applicants to submit their applications. Our deadline [to submit for round two] was June 30.

“We did this,” Hedrick continued, “because a lot of providers don't understand what all is involved in getting accredited. They have quite a bit of information they have to send in to us. All of that has to be reviewed and then a contract signed before a company can be considered 'in process.'” (The application process varies among accrediting bodies.)

Hedrick noted the application response ACHC saw before dismissal of the round two deadlines was particularly heavy. “We were quite busy prior to [the deadline drop]. During the month of May, we received more applications than we did in all of 2004,” she noted, adding that accreditation applications had increased among providers both in and out of the 70 round two MSAs.

“Obviously [applications from those] MSAs were a greater percentage, but we did see and continue to see applications from outside the MSAs,” she said.

But in a competitive bidding area or not, Hedrick said ACHC's advice to providers remains the same: “The most important thing we keep emphasizing is that mandatory accreditation is a totally different thing from competitive bidding. Mandatory accreditation is not going away. Start preparing now. Don't wait until the last minute.”

Sandra Canally, president of accrediting body The Compliance Team, echoed Hedrick's advice: “Talk to the accreditors. Choose what is right for your organization. Come forward. Do it now.”

Like ACHC, Canally said her organization saw an influx of providers seeking accreditation while the round two deadlines remained in place. But now that they have been dropped, the number of providers applying “certainly has died down. We have seen a real decrease. Everyone has put on the brakes,” she said. “Even though the September [2009] deadline stands, providers seem to be thinking that since competitive bidding has been pushed back, maybe this deadline will be, too.”

Canally said The Compliance Team has seen a decrease of at least 50 percent in appplications since competitive bidding was delayed.

The reaction is exactly what industry stakeholders feared might happen.

Last week, the American Association for Homecare said the organization “opposes the cancellation of accreditation deadlines that had been in effect” for round two of the bidding program.

“The home medical equipment industry has advocated accreditation of home care providers for three decades because accreditation can serve as a powerful tool in preventing fraud and raising standards for this important sector of the nation's health care system,” said AAHomecare President and CEO Tyler Wilson. “We are surprised that CMS would argue against the reforms and delay enacted by Congress in the Medicare Improvements for Patients and Providers Act of 2008 (MIPPA) by stating that MIPPA delays accreditation--and then cancel the accreditation deadlines it had already set for providers in 70 metropolitan areas.

“We do not favor government delays to the accreditation requirement. Accreditation for this industry is already 30 years overdue,” Wilson continued. “If the federal government wants to get serious about preventing fraud, it should use tools like accreditation more aggressively and use its ample, existing authority much more effectively.”

AAHomecare pointed out the new Medicare law does close a loophole that had allowed non-accredited providers to serve Medicare beneficiaries under subcontracting arrangements. Under MIPPA, all DMEPOS suppliers, whether they are billing Medicare directly or are a subcontractor to another supplier, must be accredited.

CMS has also been beating the “get accredited” drum, hosting a series of accreditation teleconferences to answer questions about the process. In a conference call July 15, CMS' Sandra Bastinelli reminded listeners of the Sept. 30, 2009, all-provider deadline.

By that date, Bastinelli said, “all DMEPOS suppliers must comply with quality standards--and that means to be accredited--in order to retain or obtain a Medicare Part B payment for DMEPOS.”

CMS Awards Palmetto GBA Continuing NSC Contract
COLUMBIA, S.C.--Palmetto GBA will continue as Medicare's National Supplier Clearinghouse after CMS awarded the company another one-year contract--with four one-year options that, if exercised, would put the contract's value at $76 million.

Palmetto has held the NSC contract since 1993. Responsibilities include issuing and recommending revocations of Medicare billing privileges for suppliers "to ensure that only accredited, qualified suppliers are enrolled in the Medicare program," according to a press release. The NSC also is required to establish and maintain programs to prevent and detect fraud.

"We are extremely proud to continue the important work of the NSC," said Bruce Hughes, Palmetto president. "CMS has demonstrated its confidence that Palmetto GBA will carry out the responsibilities as efficiently as possible while providing quality service to medical equipment suppliers and the Medicare program.

"Our NSC employees work every day to make sure Medicare beneficiaries can obtain the medical equipment and supplies they need from suppliers that meet Medicare standards. We look forward to performing these duties for years to come."

Headquartered in Columbia, S.C., as an ndependent licensee of the Blue Cross and Blue Shield Association, Palmetto GBA also has offices in South Carolina, Georgia, Ohio and Illinois. Its principal business is providing administrative services for the Medicare program.

NSCAC Launches Web Site
STILLWATER, Minn.--Last week, the National Supplier Clearinghouse Advisory Committee launched a Web site at www.nscac.org to offer HME providers additional resources for interacting with the NSC.

Comprised of individuals representing their respective DME MAC Jurisdiction Advisory Committees/Councils in all four jurisdictions in the United States, the NSCAC was formed to improve communication between the NSC and the supplier community. The committee meets regularly with NSC senior management.

The new Web site offers a tracking form so providers can document issues related to NSC site visits, and a form for submitting questions concerning the NSC. The NSCAC compiles all questions that are received on a quarterly basis and then submits them to the NSC for answers. The new Web site also includes a compilation of previous questions and answers from the NSC, along with minutes from recent meetings with the NSC.

NSCAC Executive Committee members include:
--Chairman Joan Cross of C&C Homecare, Bradenton, Fla.;
--Vice Chair Duane Ridenour of Universal Software Solutions, Spartanburg, S.C.;
--Secretary Miriam Lieber of Lieber Consulting, Sherman Oaks, Calif.;
--Treasurer Herb Langsam of Medicare Recovery, Oklahoma City, Okla.;
--Past Chair Tom Heinrich of McKesson Medical-Surgical Minnesota Supply, Golden Valley, Minn.; and
--Rose Schafhauser of Association Management, Stillwater, Minn., who is responsible for NSCAC administration.

For more information, contact Schafhauser at the NSCAC offices at 651/351-5395 or email schafhause@aol.com.

Invacare Reports Strong Q2 Results
ELYRIA, Ohio--On Thursday, HME manufacturing giant Invacare reported results from a strong second quarter, ended June 30.

Net earnings increased to $6.3 million or 20 cents a diluted share, from $0.1 million, or zero cents a diluted share, for the same period a year ago. Net sales rose 13.7 percent to $447.2 million versus $393.3 million last year.

For the first half of the year, net earnings were $9.4 million, or 29 cents a diluted share, compared to a $17.5 million net loss, or 55 cents a diluted share, for the same period a year ago. Net sales for the six months increased 12.4 percent to $863.4 million versus $768.2 million for the same period last year.

According to a statement from the company, the significant improvement was the result of organic sales growth and cost reduction activities.

In the North American HME market for the second quarter, Invacare said, net sales increased 12.3 percent to $187.2 million compared to $166.6 million in the same period last year, driven primarily by sales increases in all principal product lines. Foreign currency and acquisitions each increased net sales by one percentage point.

Rehab product line net sales increased by 6.7 percent compared to the second quarter last year, despite volume declines in the consumer power product line caused by the company’s previous decision to terminate sales to a large national account. Excluding consumer power products, rehab product line net sales increased 13.3 percent compared to the second quarter last year, driven by volume increases in custom power and custom manual wheelchairs as well as seating and positioning products.

Standard product line net sales for the second quarter increased 15.1 percent compared to the second quarter last year, driven by increased volumes in manual wheelchairs, patient aids and beds partially offset by discounts associated with higher sales of manual wheelchairs to national providers. Respiratory product line net sales increased 9.2 percent, driven by volume increases in oxygen concentrators and strong purchases by national and independent providers.

“The company’s strong organic sales growth and cost reduction initiatives allowed us to achieve significant earnings improvement from last year as well as sequentially from the first quarter,” said Invacare Chairman and CEO A. Malachi Mixon, III. “Cost reduction and selective price increases continue as top priorities in order to offset commodity cost increases which have been incurred on a global basis.”

Over the past several years, Invacare has closed and consolidated plants, cut jobs and sent some of its manufacturing to China to lower costs. (See HomeCare, September 2005.)

To compensate for rising commodity costs, each of the company’s segments has already completed or is implementing planned selective price increases and freight policy changes for the third quarter, Invacare said.

Invacare’s earnings statement also notes Congress’ delay of national competitive bidding by 18 to 24 months.

“This action avoided severe disruptions to patient service and provider stability,” the company said. “In addition, high-end rehab power wheelchairs and accessories, where Invacare is the market leader, were excluded from any future NCB program.”

In addition, the company said, elimination of a provision of the Deficit Reduction Act of 2005 mandating that beneficiaries assume ownership of oxygen equipment after 36 months “not only reduces a significant risk to COPD patients but also reduces the risk to providers of investing in new oxygen therapy delivery technologies where Invacare has been the industry leader with products such as the HomeFill oxygen system and XPO2 portable oxygen concentrator.”

Considering all factors, the company said, Invacare expects net sales to rise between 5 percent and 6 percent this year, excluding the impact of acquisitions and foreign currency translation adjustments.

“While we remain cautious regarding the impact of commodity cost increases and reimbursement and pricing pressures in Europe, we are confident in our plans to improve second-half profitability and cash flow,” said Mixon. “We expect sequential improvement in earnings to be driven primarily by continued cost reduction efforts, selective pricing increases, freight recovery actions and organic sales growth. Looking beyond 2008, we expect that the delay related to required changes for NCB will improve the business outlook for the HME industry and Invacare in 2009 and beyond.”

The company’s shares jumped nearly 9 percent to $22.77 Thursday on the New York Stock Exchange, and by the market's close on Friday had risen to $23.05.

Kerry, Grassley Introduce 'Empowered at Home Act'
WASHINGTON--On Thursday, Sens. John Kerry, D-Mass., and Chuck Grassley, R-Iowa, introduced the “Empowered at Home Act.” The bill seeks to give states new tools and incentives to make home- and community-based services more available to those who need them, its sponsors said, with the aim of keeping the elderly and disabled in need of care in their homes instead of funneling them into more expensive long-term care settings.

“Far too many elderly or disabled Americans can’t get the help they need in their home and community,” Kerry said in a joint statement from the senators. “Home- and community-based services are high-quality, cost-effective, and help many people live independent lives, but Medicaid continues to favor nursing homes.

"It’s a problem when the nation’s largest purchaser of long-term care services is tilted towards nursing homes rather than home- and community-based services,” he continued. “This bill will level the playing field and give families real choices to care for their loved ones, and give cash-strapped states new tools to provide cost-effective long-term care options to the most vulnerable.”

“Being able to live at home greatly improves quality of life because people can be with loved ones and have the dignity that goes with greater independence,” said Grassley. “This bill encourages states to help make that possible, which is also fiscally smart because institutional care is the most expensive form of long-term care that Medicaid pays for. This bill also empowers individuals to manage the financial burdens that come with caregiving needs.”

The Empowered at Home Act has four basic parts:

First, it would improve the Medicaid HCBS State Plan Amendment Option by giving states more flexibility in determining eligibility for which services they can offer under the program, which would create greater options for individuals in need of long-term support. “In return, we ask that states no longer cap enrollment and that services be offered throughout the entire state,” the senators said.

Second, the bill ensures that the same spousal impoverishment protections offered for new nursing home beneficiaries would be in place for those opting for home- and community-based services. In addition, low-income recipients of those services would be able to keep more of their assets when they become eligible for Medicaid, allowing them to stay in their community as long as possible.

Third, the bill addresses the financial needs of spouses and family members caring for a loved one by offering tax-related provisions to support family caregivers and promote the purchase of private long-term care insurance.

Finally, the bill seeks to improve the overall quality of home- and community-based services available by providing grants for states to invest in organizations and systems that can help to ensure a sufficient supply of high-quality workers, promote health and transform home- and community-based care to be more consumer-centered.

The National Council on Aging, Alzheimer’s Association, American Geriatrics Society, Trust for America’s Health and other organizations are supporting the measure.

In Brief
In Brief
The National Association of Independent Medical Equipment Suppliers has launched "Win at Home 2008," a program to help suppliers get into politics. "Never before have suppliers begun the election season with so much industry recognition," a statement from the group said, noting the industry's recent success with H.R. 6331. However, the statement continued, "This doesn't mean we can rest for a moment." NAIMES said it will provide guidance to suppliers on how to become involved in the fall election campaign and offer assistance to state associations to ensure that the value of DME and home care is a part of the fall election process: "With 45 open seats in the House and five in the Senate, suppliers have the opportunity to develop relationships and educate candidates before they go to Washington and use the momentum of H.R. 6331 to build a wider support for the industry."

Sheldon "Shelly" Prial has been hired as a consultant to the Medtrade and Medtrade Spring events, show producer Nielsen Business Media announced last week. With close to 60 years of experience in HME, Prial has been involved as a provider, consultant, creator of the HomeCare Providers Co-op and director of government relations for Graham-Field Health Products. “We are thrilled Shelly is willing to commit his time to being what I am calling a ‘Medtrade goodwill ambassador’ and know that his enthusiasm for the Medtrade and Medtrade Spring events will be contagious,” said Kevin Gaffney, CEM, group show director for Nielsen. “We would have been hard-pressed to find anyone else who has more experience and passion for the HME industry than he does.” Prial will work with the company to promote the 30th anniversary of Medtrade in 2009. Medtrade 2008 will take place Oct. 27–30 at the Georgia World Congress Center in Atlanta. Medtrade Spring 2009 will be held at the Las Vegas Convention Center March 24–26. For more information, visit www.medtrade.com or call 800/933-8735.

CMS has scheduled a special Open Door Forum on outpatient therapy payment alternatives Wednesday, Aug. 6. The two-hour call will begin at 2 p.m. EDT. The conference call is intended primarily for providers of physical therapy, occupational therapy and speech language pathology--collectively termed "Medicare outpatient therapy"--which, according to CMS, accounts for 3 percent of Part B spending. The session will introduce the Developing Outpatient Therapy Payment Alternatives (DOTPA) project "with a special emphasis on how data will be collected for this project and how facilities, practices and individual providers may become involved and contribute to this ground-breaking research," CMS said. The agency said the goal of the five-year project is to develop payment method alternatives to the current financial cap on outpatient therapy services. Registration for the Open Door session is required at registration.intercall.com/go/cms2.

Coming Up
Coming Up
The Georgia Association of Medical Equipment Services (GAMES) will hold its Annual Convention Aug. 4-6 in St. Simons Island, Ga. For more information, call 770/578-3999 or visit www.gameshme.org.

The Virginia Association of Durable Medical Equipment Companies (VADMEC) will host its Summer Meeting and Exhibit in Virginia Beach, Va., Aug. 6-8. For more information, call 919/387-1221 or visit www.vadmec.org.

The Big Sky Association of Medical Equipment Services will host its Quarterly Meeting Aug. 8 in Butte, Mont. For more information, call 406/777-7301 or visit www.bigskyames.org.

The Arizona Medical Equipment Suppliers Association (AZMESA) will host its Annual Convention Aug. 14 in Phoenix. For more information, call 651/439-2944 or visit www.arizonamesa.org.

National Government Services (NGS) will hold its Medicare Convention 2008 in Indianapolis Aug. 25-28. For more information, visit www.ngsmedicare.com/ngsmedicare/HomePage.aspx.

The Medical Equipment Suppliers Association (MESA) will hold its Fall Conference Sept. 3-5 in Dallas. For more information, call 800/722-2310 or visit www.mesanet.org.

CMS APPROVED ACCREDITATION FOR ALL DMEPOS
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