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Massive Cuts to Medicare Home Oxygen Therapy Benefit Taking Effect January 1 Creating Acute Anxiety Among Beneficiary and Provider Communities
Date:12/31/2008

27 Percent Funding Cuts in 2009 Will Reduce Payments for Home Oxygen Therapy to Less Than Half of 1997 Payment Rates

WASHINGTON, Dec. 31 /PRNewswire-USNewswire/ -- As Americans nationwide prepare to celebrate the New Year, the home oxygen community is looking to 2009 with great unease due to significant Medicare policy changes that will present many challenges to beneficiaries and providers alike. On January 1, two new policies in the form of a 36-month cap on payments for home oxygen therapy and a 9.5 percent across-the-board payment cut will take effect, deeply impacting a community that cares for more than 1.5 million elderly and chronically ill patients.

Under the new 36-month cap, Medicare will stop payment for stationary home oxygen therapy equipment and related services after the beneficiary reaches the three year mark. Despite the discontinuation of payments after 36 months, providers will still be required to continue all servicing of patient needs and equipment including patient-generated, non-routine emergency home visits and routine replacement of disposable oxygen supplies, such as tubing and masks. Providers will also be responsible for ensuring that patients are appropriately serviced even if the patient moves out of the provider's service area within or following the first 36 months of service.

"The provider community is extremely committed to making every effort to meet patient needs and provide uninterrupted services," said Peter Kelly, Chairman of the Council for Quality Respiratory Care (CQRC). "However, it is difficult to comprehend how providers can maintain patient service levels on an uncompensated basis. Based on the magnitude of these cuts, the provider community cautions that service reductions may be unavoidable as a result of business failures or financial hardship and cause potential access problems for the vulnerable patient population we care for."

Historically, the home oxygen benefit has been subject to repeated cuts. The implementation of the 36-month cap, enacted by Congress in the Deficit Reduction Act of 2005 (DRA), and the 9.5 percent cut, part of the Medicare Improvements for Patients and Provider Act of 2008 (MIPPA), translate to a 27 percent, or $845 million, cut in 2009 alone. A recent analysis from Avalere Health "indicates that the average Medicare home oxygen payment by 2009 will be less than half of what it was in 1997."

The CQRC urges Centers for Medicare and Medicaid Services (CMS) officials to exercise the Secretary's authority to create reasonable post-cap policies, including payments for emergency and non-routine services and reimbursement for disposable supplies after 36 months. CMS should also reset the cap when a beneficiary moves out of his or her service area and requires a new provider. The CQRC asks policymakers to closely monitor the effects of these deep cuts on both beneficiaries and providers to ensure that patient access to essential home oxygen care is not compromised. Ultimately, the home oxygen community hopes to work with policymakers to develop thoughtful, comprehensive reforms of Medicare policies that protect patient access to quality oxygen care.

"We want all patients to have complete access to all services related to their home oxygen care, throughout their entire period of medical need," added Kelly. "With more than one quarter of home oxygen beneficiaries requiring oxygen for more than 36-months, the impact of the cap, coupled with the dramatic 9.5 percent cut, is going to resonate throughout the oxygen community. Although providers are working hard to prepare for the approaching payment changes, these cuts are simply unsustainable and may negatively impact beneficiary care."

The Council for Quality Respiratory Care is an alliance of the nation's leading home oxygen therapy providers and manufacturers, representing nearly one half of the 1.5 million Medicare beneficiaries who depend on the home oxygen benefit for independence and quality of life.


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SOURCE Council for Quality Respiratory Care
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