In a letter to House Minority Leader Kevin McCarthy, the Congressional Budget Office (CBO) warned that projected deficits from the American Rescue Plan Act of 2021 (ARA or the Act) may double the current Medicare sequester rate. Absent congressional action to offset the projected deficits or waive their inclusion in required budgetary scorecards, existing law requires the Office and Management and Budget (OMB) to increase the Medicare sequester rate to 4 percent in January 2022.

The CBO further estimates that increasing the Medicare sequester to the maximum 4 percent covers $36 billion of the $381 billion annual deficit attributable to the Act. The Statutory Pay-As-You-Go Act of 2010 (PAYGO) requires further spending reductions in other non-exempt programs to make up the balance. Wiping out those programs, including farm price supports and block grants for vocational rehabilitation and social services, only amounts to $80-$90 billion in additional savings. Congressional action, then, is almost certain; without it, the OMB cannot meet its obligations under PAYGO.

There are several ways Congress could make up the deficit:

• Increase the Medicare sequester limit past 4 percent.
• Raise taxes or pass other legislation to offset the ARA’s deficit effects on the PAYGO scorecards.
• Waive applicability of PAYGO to the ARA …

But that begs the question, If congress simply changes the law when it doesn’t suit, is sequestration really acting as a budgetary constraint or has it simply become a subsidy funded by healthcare providers?

Maybe we need to ask for our 2 percent back.

SOURCE LINKS
https://www.congress.gov/bill/117th-congress/house-bill/1868/text
https://www.cbo.gov/system/files/2021-02/57030-McCarthy.pdf
https://obamawhitehouse.archives.gov/omb/paygo_description/

A recent pilot program found 60% of providers reported that using commercially available electronic prior authorization tools and processes make it easier to understand authorization requirements applicable to covered procedures. Six health insurers covering more than 50 million Americans across all 50 states participated in the Fast Prior Authorization Technology Highway (Fast PATH) demonstration sponsored by trade group America’s Health Insurance Plans (AHIP).

The findings hint that, in addition to saving time, suppliers may be able to reduce denials for missing authorizations because electronic tools clarify the submission requirements before delivery and/or claim submission. In the final report, researchers noted:

"Availity’s multi-payer, web-based portal helps streamline the prior authorization process for a range of procedures. First, a provider can use “Is Auth Required” functionality to see if prior authorization is necessary for a given procedure based on payer-specific guidelines. If so, the provider goes to the authorizations dashboard, which serves as the hub for managing all aspects of the process. The dashboard features a tool that guides a provider through the process of creating a request, including uploading supporting documentation. After the request is submitted, the provider can monitor the status of all pending requests, which are updated in real time, eliminating the need to call the payer for an update."

Denials for missing authorizations plague many suppliers, especially when an existing patient switches insurance plans. The same goes for new patients, especially in cases where the insurance plan is unfamiliar to the supplier.

Experienced suppliers probably won’t be surprised that electronic authorization processes significantly reduce insurance plan decision times and provider burdens related to faxes and telephone inquiries. The study found that electronic prior authorization reduced the median decision time from 18.7 hours to 5.7 hours, with a third of those decisions clocking in under two hours.

While Fast PATH did not include DME specifically, suppliers should look for opportunities to adopt existing tools for electronic prior authorization and encourage commercial plans to implement enabling pathways.

SOURCE LINKS
https://www.beckershospitalreview.com/payer-issues/what-humana-cigna-more-learned-from-yearlong-prior-authorization-pilot.html
https://www.ahip.org/wp-content/uploads/Fast-PATH-Evaluation.pdf

After implementing the 2021 DME and PEN fee schedules, CMS identified rate calculation errors affecting 364 unique HCPCS. The DME MAC contractors, however, will not automatically reprocess 2021 service dates processed before January 26, 2021. As such, suppliers should determine the benefit of any adjustment and, as applicable, request a reopening before the end of the year.

Which Suppliers Benefit?

There are very few cases in which the revised fee schedule rates negatively impact suppliers in non-continental areas. Suppliers in Hawaii, Alaska, Puerto Rico, and the Virgin Islands will see a few decreases, but they are much more likely to find an overall net benefit in reprocessing affected claims.

While the fee schedule does contain numerous reductions for other areas, nearly all the HCPCS with negative fee schedule changes apply to wheelchair accessories billed with the KE modifier in non-rural areas. The distinction is important because suppliers do not routinely use the KE modifier in non-rural areas. Instead – and only when appropriate – suppliers attach it to accessories in rural and non-continental areas largely spared from downward corrective adjustments. 

The revised schedule contained no changes for suppliers of:

• Diabetic shoes or testing supplies.
• Prosthetics or orthotics billed with L-codes.
• Former bid products in competitive bid areas.

The Impact of a Reopening

To illustrate the impact of potential fee schedule changes, we provide two sample claim comparisons:​

Requests to reprocess affected claims will affect all included items, not just those that yield a larger payment. Suppliers should evaluate the list of corrected HCPCS (see below) and determine the expected net benefit of reprocessing claims before taking any action. Reopening requests are due within 12 months of the original remittance, so suppliers should file requests well before December 31, 2021.

​Affected HCPCS include:
A4557, A4563, A4595, A4604, A4636, A4637, A4640, A6550, A7000, A7003, A7004, A7005, A7006, A7007, A7010, A7012, A7013, A7014, A7015, A7017, A7018, A7027, A7028, A7029, A7030, A7031, A7032, A7033, A7034, A7035, A7036, A7037, A7038, A7039, A7044, A7045, A7046, B4034, B4035, B4036, B4081, B4082, B4083, B4087, B4088, B4149, B4150, B4152, B4153, B4154, B4155, B9002, E0130, E0135, E0140, E0141, E0143, E0147, E0148, E0149, E0154, E0155, E0156, E0157, E0158, E0159, E0160, E0161, E0163, E0165, E0167, E0168, E0170, E0171, E0181, E0182, E0184, E0185, E0186, E0187, E0188, E0189, E0193, E0196, E0197, E0199, E0250, E0251, E0255, E0256, E0260, E0261, E0271, E0272, E0275, E0276, E0277, E0280, E0290, E0291, E0292, E0293, E0294, E0295, E0301, E0302, E0303, E0304, E0305, E0310, E0316, E0325, E0326, E0371, E0372, E0373, E0424, E0431, E0433, E0434, E0439, E0441, E0442, E0443, E0444, E0447, E0470, E0471, E0472, E0561, E0562, E0565, E0570, E0572, E0585, E0601, E0621, E0627, E0629, E0630, E0635, E0636, E0705, E0720, E0730, E0731, E0776, E0910, E0911, E0912, E0940, E0950, E0951, E0952, E0953, E0954, E0955, E0956, E0957, E0958, E0959, E0960, E0961, E0966, E0967, E0971, E0973, E0974, E0978, E0981, E0982, E0985, E0990, E0992, E0995, E1002, E1003, E1004, E1005, E1006, E1007, E1008, E1010, E1015, E1016, E1020, E1028, E1029, E1030, E1031, E1035, E1036, E1037, E1038, E1039, E1225, E1226, E1372, E1390, E1391, E1392, E1405, E1406, E2201, E2202, E2203, E2204, E2205, E2206, E2207, E2208, E2209, E2210, E2211, E2212, E2213, E2214, E2215, E2216, E2217, E2218, E2219, E2220, E2221, E2222, E2224, E2225, E2226, E2228, E2231, E2310, E2311, E2321, E2322, E2323, E2324, E2325, E2326, E2327, E2328, E2329, E2330, E2351, E2359, E2360, E2361, E2362, E2363, E2364, E2365, E2366, E2367, E2368, E2369, E2370, E2371, E2373, E2374, E2375, E2376, E2377, E2378, E2381, E2382, E2383, E2384, E2385, E2386, E2387, E2388, E2389, E2390, E2391, E2392, E2394, E2395, E2396, E2397, E2402, E2601, E2602, E2603, E2604, E2605, E2606, E2607, E2608, E2611, E2612, E2613, E2614, E2615, E2616, E2619, E2620, E2621, E2622, E2623, E2624, E2625, E2626, E2627, E2628, E2629, E2630, E2631, E2632, E2633, K0001, K0002, K0003, K0004, K0006, K0007, K0015, K0017, K0018, K0019, K0020, K0037, K0038, K0039, K0040, K0041, K0042, K0043, K0044, K0045, K0046, K0047, K0050, K0051, K0052, K0053, K0056, K0065, K0069, K0070, K0071, K0072, K0073, K0077, K0098, K0105, K0195, K0733, K0738, K0800, K0801, K0802, K0813, K0814, K0815, K0816, K0820, K0821, K0822, K0823, K0824, K0825, K0826, K0827, K0828, and K0829.

SOURCE LINKS
https://www.cms.gov/Center/Provider-Type/Durable-Medical-Equipment-DME-Center
https://www.cms.gov/medicaremedicare-fee-service-paymentdmeposfeescheddmepos-fee-schedule/dme-21ar

In recent months, three CMS advisory groups issued recommendations that could shape future policy and payment initiatives for CPAPs, BiPAPs, and ventilators. To help respiratory suppliers predict and prepare for future policy changes, this article summarizes the major points from each of the three advisors.

The AHRQ Review

The Agency for Healthcare Research and Quality (AHRQ) is a division within HHS that evaluates published clinical studies and ensures CMS understands and uses supportable findings that make healthcare safer and more accessible.

Last February, AHRQ completed its review of 33 relevant studies conducted during the last 25 years that examined patients with chronic obstructive pulmonary disease (COPD) and hypercapnia (respiratory failure resulting from carbon dioxide retention). Patients in the studies utilized either bilevel positive airway pressure devices or noninvasive home mechanical ventilators.

The reviewers found evidence that bilevel devices have a positive effect on mortality, hospitalizations, and intubations. The ventilator data, however, showed improvement only with hospitalizations. To be fair, the ventilator datasets were much smaller and captured less information than their bilevel counterparts.

The MEDCAC Meeting

The Medicare Evidence Development and Coverage Advisory Committee (MEDCAC) is an independent panel of 100 experts from the medical community that provide guidance to CMS on clinical topics. In July, CMS held a public meeting with selected experts from the MEDCAC to weigh evidence on the home use of non-invasive positive pressure devices in patients with chronic respiratory failure (CRF) consequent to COPD.

After reviewing written materials and hearing oral presentations from several professional societies and equipment manufacturers, the panel issued a confidence vote scoring four key statements using a scale of 1 to 5 – with 1 representing no confidence and 5 representing high confidence:

Patients demonstrate improved outcomes with any positive pressure device.

• Score: 3.15.
• Consensus: The data affirms CPAPs are inappropriate for chronic respiratory failure. BiPAPs, and to a lesser-degree ventilators, are effective at producing better outcomes.

Specific device settings or parameters promote better outcomes.

• Score: 2.85.
• Consensus: Higher-pressure settings seem to produce better results, but the data does not conclusively connect the dots for more precise settings.

Patient usage (number of hours) requirements are necessary to achieve better outcomes.

• Score: 2.38.
• Consensus: Greater usage time results in better outcomes, but evidence regarding minimal and maximum usage falls short. The panel expressed concerns that minimal hour requirements could limit patient access and cause more harm than good.

Use of the equipment by itself (excluding respiratory support, education, etc.) produced better outcomes.

• Score: 2.23.
• Consensus: The data suggests pairing equipment with respiratory therapist support, patient education, and regular intervention produces better outcomes. These companions should remain part of the delivery model.

The OIG Report

Last September, the Office of Inspector General (OIG) completed its review of Medicare payment data for noninvasive ventilator claims between 2016 and 2018. The study found Medicare paid approximately $69.3 million more than other payers for noninvasive ventilators over the three-year period.

The OIG recommended CMS lower fee schedules by adding noninvasive ventilators to the competitive bidding program. Despite removing noninvasive ventilators as part of a broader pandemic response during the last round of bidding, CMS confirmed its continued review of these products for inclusion in future rounds of the bid program.

The Cumulative Effect

By commissioning the AHRQ review and MEDCAC meeting, CMS is clearly trying to weigh clinical evidence surrounding the best treatment options for COPD patients with respiratory failure. As ventilator claim volume increases exponentially, CMS must weigh the reasonableness of potential coverage changes and its stewardship of the Medicare trust fund.

The evidence leans more heavily toward the use of BiPAP devices over ventilators in the treatment of these patients, potentially because we have more data on BiPAP use than on ventilator use. To clear the way for ventilator use, the industry will likely need larger studies with larger sample sizes to determine how various BiPAP settings compare to ventilators settings and their respective impacts on mortality, intubation, hospital admissions, and overall quality of life.

Many of the experts pointed out that coverage restrictions in Medicare’s Respiratory Assist Device (RAD) Local Coverage Determination (LCD) force prescribers to order ventilators over BiPAPs despite the clinical evidence that BiPAPs are effective. Not only are ventilators more expensive, evidence suggests patients may not need the additional settings offered by ventilators to achieve a positive outcome. As a result, CMS may end up loosening restrictions in the RAD policy to increase access and utilization of BiPAPs for treating COPD patients with hypercapnia.

Meaningful policy changes that alter the RAD utilization in lieu of ventilators will significantly change business and delivery models. Stakeholders can actively shape policy by debating the merits of, and where possible participating in, clinical studies. Moreover, those suppliers with the best handle over their own business metrics will be in the best position to take advantage of increased BiPAP utilization and estimate sustainable prices if ventilators are reintroduced into the competitive bid program.

SOURCE LINKS
AHRQ: https://pubmed.ncbi.nlm.nih.gov/32016309/
MEDCAC: https://www.cms.gov/medicare-coverage-database/details/medcac-meeting-details.aspx?MEDCACId=77&bc=AAACAAAAAAAA&
OIG: https://oig.hhs.gov/oas/reports/region5/52000008.asp