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American Association for Homecare Disputes Validity of Internet Power Wheelchair Prices as Basis for Reimbursement of Services in Medicare
Date:11/12/2007

Association Sends Letters to HHS Office of Inspector General and Congressman Pete Stark

ARLINGTON, Va., Nov. 12 /PRNewswire-USNewswire/ -- Today, the American Association for Homecare vigorously disputed the validity of using Internet prices for power wheelchairs as a basis for setting reimbursement rates for power wheelchairs provided to seniors and disabled beneficiaries in Medicare.

The Association outlined its concerns in letters sent today to Daniel Levinson, Inspector General for the U.S. Department of Health and Human Services Office of Inspector General (OIG), and to Congressman Pete Stark (D-Calif.), who chairs the House Ways and Means Subcommittee on Health. (See text of letters at Newsroom at http://www.aahomecare.org.)

On October 30, the OIG issued a report titled, "A Comparison of Medicare Program and Consumer Internet Prices for Power Wheelchairs," which concluded that, "Medicare and its beneficiaries could have achieved savings during the first quarter of 2007 had Medicare reimbursements more closely resembled prices available to consumers over the Internet." AAHomecare strongly questions the appropriateness of the OIG comparison and its policy implications for Medicare reimbursement rates.

Tyler J. Wilson, president of the American Association for Homecare, commented, "This study and the inappropriate comparison of Medicare and Internet pricing will be used by some members of Congress to justify further cuts to power wheelchair Medicare reimbursement rates and defend the new competitive bidding program. We urge Congress to evaluate Medicare reimbursement for power wheelchairs in the correct context."

In today's letters to both Inspector General Levinson and Congressman Stark, the Association made several points:

-- The cost of acquiring power wheelchairs used by Medicare beneficiaries through the Internet does not in any way compare to the cost of providing these devices to Medicare beneficiaries while adhering to the appropriate standards of care. The implied cost savings of Internet pricing is extremely misleading.

-- In a previous OIG analysis of power wheelchair prices titled, "A Comparison of Prices for Power Wheelchairs in the Medicare Program" from April 2004, the OIG acknowledged that, "The estimates of potential program savings presented in the findings of the report would be lower if median prices had included any supplier administrative costs."

-- Internet pricing does not account for the specialty evaluations performed by certified medical professionals, training, repairs and other non-equipment costs that are required in furnishing power wheelchairs to Medicare beneficiaries. Under Medicare, durable medical equipment providers must shoulder the expense of evaluating the beneficiary's specific needs, assessing the home, assembling the wheelchair, delivering the equipment to the home, conducting customized on-site fitting to accommodate the individual's seating needs, performing on-site training, processing claims for payments to insurers, and maintaining facilities to provide service and repair. Any accurate analysis of costs required to provide the expected Medicare standard of care must take into account these services and administrative costs, which are distinct from the costs of acquiring the equipment.

-- Internet prices for power wheelchairs are an inappropriate and inaccurate source of data for establishing Medicare fees for these devices. Use of such data would skew the median price downward because the data does not account for all of the required services and activities necessary to furnish power wheelchairs to Medicare beneficiaries in a manner that ensures the beneficiary's safety and complies with standards applicable to Medicare enrolled providers.

The American Association for Homecare is working on scheduling meetings with both Congressman Stark and with Inspector General Daniel Levinson to rebut the "apples to oranges" comparisons made by the OIG study.

The American Association for Homecare represents durable medical equipment providers, manufacturers, and other organizations in the homecare community. Members serve the medical needs of millions of Americans who require oxygen equipment and therapy, mobility assistive technologies, medical supplies, inhalation drug therapy, home infusion, and other medical equipment and services in their homes.


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SOURCE American Association for Homecare
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