Editor's Note

Time to Start Pushing Back

Consolidation in HME is only inevitable if providers let it happen.

• By David Kopf
• Mar 01, 2014

While it’s only my gut-level opinion, I really feel like CMS is out to drive as much consolidation among post-acute Medicare suppliers as possible. I look at competitive bidding, face-to-face, capped rental, and the continued audit onslaught, and can’t help concluding CMS’s aim is to essentially steam roll the HME industry.

CMS’s ramped up program integrity efforts are case in point. As Edward Vishnevetsky of industry law firm Munsch Hardt Kopf & Harr points out in this month’s Observation Deck column (“Flirting with Disaster,” page 34), with the recent decision to delay the assignment of ALJ’s by two years, auditors can audit whatever they want with no real oversight. While the percentage of audits that have been overturned at ALJ has been considerable, now that the appeal process is all but stalled out, the auditor can get compensated for the recouped payment and who knows where the provider will be two years from now? And, as Vishnevetsky, outlines in his column, the provider is saddled with business-crushing costs in the meantime.

At press time, the American Association for Homecare and other industry advocates and stakeholders are working overtime with CMS and the Office of Medicare Hearings and Appeals to bring develop a solution that does not put providers in an impossible and unfair position, and I believe they will pull it off. That said, CMS always waits for situations to become a crisis before it will sit down with the industry and sort out a fix.

Based on my experience, that is not “normal” for a federal agency (if there is a “normal” in Washington, D.C. at all). I’ve worked in business media since 1992, and I’ve written for a number of heavily regulated industries, but I’ve never seen an agency with the kind of adversarial relationship with its suppliers that CMS does.

For instance, from my days working in the motorcycle industry, I can remember business stakeholders sitting down with agencies such as the Environmental Protection Agency, the Department of Transportation, or the National Highway Traffic Safety Administration, and hashing things out. I’m not saying it was pretty or that everyone was singing “Kumbaya” in perfect harmony. Sometimes mutually satisfactory solutions were developed. Sometimes they weren’t. But there was an effort between government and industry to try and balance public policy and business objectives.

That doesn’t seem to be happening with CMS. Our industry’s relationship with our key federal “partner” is much more adversarial. Yet, CMS has to know that the DMEPOS benefit saves it big money over the long haul. This is what convinces me that CMS seeks consolidation. It wants fewer players to further drive down cost — at all cost.

This is why an HME provider cannot be a responsible member of this industry and not fight tooth and nail on its behalf. And that’s worrisome, because at a certain point, fatalism sets in. Look at competitive bidding: With Round Two implementation and Round One in Re-Compete, there is a real temptation to give in and simply accept the program as an inevitability — the new reality that providers must face.

While I wholeheartedly believe that HME providers must work overtime to seek out new business models that drive non-Medicare revenues and leverage new business opportunities in order to diminish the sway Medicare and CMS hold over their businesses, there is no doubt that Medicare beneficiaries will continue to comprise a sizable portion of their clients.

Bearing that in mind, providers owners and operators must pull double duty and engage heavily in industry advocacy. Getting out there and lobbying on behalf of the industry is absolutely necessary, but how many of us do it? When is the last time you called your Representative’s office? Don’t give in to fatalism and let CMS push its consolidation agenda. Join your state association, support the American Association for Homecare, get involved, and start pushing back.

This article originally appeared in the March 2014 issue of HME Business.