Oxygen Service Study Proposed in House Bill

WASHINGTON--While the Children's Health and Medicare Protection Act (H.R. 3162) passed by the House of Representatives last week contains home oxygen and power wheelchair cuts, it also includes one provision that would be favorable for HME, according to Cara Bachenheimer, vice president, government relations, for Elyria, Ohio-based Invacare.
Bachenheimer pointed out that the CHAMP Act contains a provision for a study to understand the service component that oxygen suppliers provide. The study would be carried out by the Department of Health and Human Services and would be due to Congress 18 months after the law is passed. The study would consider:
--Types of services provided; --Which services are medically necessary or can contribute to better outcomes; and --How much Medicare should be paying for services and medical equipment.
The HHS secretary would also be directed to compare payment rates to competitive bidding rates to show how much Medicare should pay, Bachenheimer said, and also to recommend whether Medicare should pay separately for service.
Results of a study commissioned by the American Association for Homecare in 2006, which was conducted by research firm Morrison Informatics, showed that 72 percent of providers' costs in supplying home oxygen go to services and related expenses while equipment represents only 28 percent.
The service issue in providing home oxygen therapy has long been "nebulous," Bachenheimer said. It is unclear what services are important and what CMS expects. The proposed study would provide critical information for CMS as well as guidance for providers.
"We need to have that study," Bachenheimer said. "We have industry studies and that is great, but the government will never look at those studies and say, 'You are absolutely right.'"
To download a PDF of the Morrison Informatics study, click here.