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GAMES February 11, 2015Washington UpdateCARA BACHENHEIMER, INVACARE CORPORATION

On Capitol Hill President’s Budget Proposal Feb 2, 2015

Medicaid rates based on bid rates $4.3B Face-to-face fix?

Doc fix/SGR expires March 31, 2015 Binding Bids Bills

H.R. 284 & S. 148 (last year’s HR 4920 & S. 2975) Reps. Tiberi (R-OH) and Larson (D-CT)

Sens. Portman (R-OH) and Cardin (D-MD)

Would require bidders to secure a bid bond prior to submitting bid

Financial vetting!

Other Bid Program Fixes In the Works Market Pricing Program Demo Transparency & due process issues

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Round 1 Re-Compete 9 MSAs

January 1, 2014 – December 31, 2016

Round 2 91 MSAs = 106 CBAs

July 1, 2013- June 30, 2016

Round 2 Re-Compete July 1, 2016 – December 31, 2018

Contracts will be 2.5 years, not 3 years

Non-Bid Areas – January 1, 2016 Fee schedule rates will be reduced

NCB Schedule3

Round 2 Recompete Schedule Dec 18, 2014 – Registration began

Jan 22, 2015 – 63-day bid window opened

Feb 17, 2015 – Registration closes

Feb 23, 2015 – Covered document review date for bidders to submit financial documents

March 25, 2015 – Bid window closes

July 1, 2016 – Dec 31, 2019

Contract periods will be 2.5 years, not 3 years

Same Geographic Areas, but

90 MSAs due to OMB changes

No bid area will cross state lines→ 117 bid areas

NMO Diabetic supplies to cover all territories

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Product CategoriesRound 1 Recompete Round 2 Round 2 Recompete

Respiratory (oxygen, CPAP, RADS, nebulizers)

Oxygen Respiratory (oxygen, CPAP, RADs)

Standard Mobility (walkers, standard power and manual, scooters & accessories)

Standard wheelchairs (power & manual), scooters & accessories

Standard Mobility (walkers, standard power and manual, scooters & accessories)

General HME (beds, Groups 1 and 2 support surfaces, TENS, commode chairs, patient lifts, seat lifts)

Beds and accessories General HME (beds, Groups 1 and 2 support surfaces, commode chairs, patient lifts, seat lifts)

Enteral Enteral Enteral

NPWT NPWT NPWT

External Infusion Pumps

Support surfaces – Group 2

TENS

CPAP & RADsWalkers

Nebulizers

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CMS Rulemaking Process

1. Application of Bid Rate Information in Non-Bid Areas, and

2. Changes to Bid ProgramFebruary 26, 2014

Advance Notice of Proposed Rule

July 11, 2014Proposed Rule

November 6, 2014Final Rule

January 1, 2015Effective Date of New Rules

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Non-Bid Areas – January 1, 2016 Rule establishes methodology CMS will use to reduce rates in non-bid areas, based upon current Round 1 and Round 2 bid rates

CMS divides country into 8 regions Establish Regional SPAs = average of

current Round 1 and Round 2 bid areas SPAs in that region

National ceiling and floor to constrain RSPAs

Ceiling will be 110% and floor will be 90% of average of (state) weighted RSPAs

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Non-Bid Areas – January 1, 2016

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Non-Bid Areas – January 1, 2016 Phase-In of new RSPA rates

January 1, 2016: rates will be blend of 50% of “old” rate and 50% new RSPA

Starting July 1, 2016: 100% RSPAs

“Rural” areas paid at national ceiling of 110%

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Non-Bid Areas – January 1, 2016 “Rural” = a geographic area

represented by a zip code if at least 50% of the total geographic area of the area included in the zip code is estimated to be outside any MSA. A rural area also includes a geographic area represented by a zip code that is a low population density area excluded from a CBA

CMS has not yet identified these areas by zip code, but expect very few

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RSPAs January 1, 2016 & July 1, 2016

Code Current

2016Ceiling

R1 NE R2 ME R3 GL R4 PL R5 SE R6 SW R7 RM

R8 FW

E13901-1-16

7-1 -16

178.24

103.38

139.63

101.02

134.21

90.18

134.48

90.71

136.63

95.02

136.57

94.89

136.40

94.56

134.88

91.52

134.72

91.20

E1392 51.63 46.90 43.10 42.38 41.74 43.40 41.91 41.83 44.02 43.41

E0260

(Bed)

132.39 78.33 75.64 68.77 69.27 73.68 70.81 69.44 70.20 70.57

K0738 51.63 46.90 43.10 42.38 41.74 43.40 41.91 41.83 44.02 43.41

K0001 58.25 29.20 26.80 24.88 25.37 26.28 27.76 26.46 26.80 26.68

K0823

K0003

568.89

97.98

315.13

45.03

279.55

40.78

276.66

37.89

280.73

39.58

282.36

40.73

299.65

42.86

280.98

40.06

288.92

41.38

288.94

42.39

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Non-Bid Areas – January 1, 2016 Payment for “low volume” and items in

no more than 10 CBAs paid at 110% of RSPAs

Items where only available SPA is from a CBP no longer in effect, paid at 110% of previous SPAs

Accessories included in one or more PCs, paid at weighted average of the SPAs for the item in each bid area Accessories used with CRT will no longer

be paid at higher fee schedule! “Unbalanced Bidding”

Lower SPAs of “lower” item to SPA of “higher” item (e.g., Group 1 vs Group 2 PMDs)

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Bundling Phase-In Phase-in of new bundling payment

method In place of current capped rental and

purchase payment rules

First phase: up to 12 new bid areas 80 possible MSAs, population of at least

250,000 Next phase: via rulemaking!

Starting with power wheelchairs and CPAP Proposed Manual WC, beds, oxygen, enteral,

RADs too

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Bundling Phase-In

Payment will be on continuous monthly

rental basis

No ownership transfer

Bids and SPA will be for monthly rental of

equipment, maintenance and servicing,

replacement of supplies and accessories

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Phased-In – starts in up to 12 NEW bid areas

Many Questions! (e.g., When?) How many items will be bundled

together?Could be one bundled code for all

standard base power chairs, accessories, batteries, etc.

Could keep base codes separate, and bundle in for each base everything else

CMS will provide “advance notice” of details

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New Bundling Payment Method

NCB New Rules Phase-In of New Repair Rule

In up to 12 (new) CBAs, under current rental rules, bidders will factor into bids costs of repair and maintenance services after ownership transfers, until medical need ends, 5 years, or beneficiary moves outside CBA - during contract period

Limited to items you originally furnished

Not responsible for repairing items someone else provided Doesn’t address most of the problem

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Audits – Air Act Audit Improvement and Reform Act (AIR)

H.R. 5083 introduced by Representatives Renee Ellmers (R-NC) and John Barrow (D-GA) on 7/11/14

Designed to increase transparency, education and outreach and reward DMEPOS providers with low error rates on audited claims

Will apply to all MACs, RACs and other contractors performing audits on DMEPOS providers

www.FixMedicareAudits.org Copy of legislation, issue brief and how to

support the bill

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Audits – Air Act Restore clinical inference and judgment when

evaluating audits. Will significantly reduce error rates

Require reporting of error rates on audited claims after adjustment for those audited claims that have been overturned on appeal

Require audit contractors to establish an education and outreach program to help providers better understand the regulations and how to document medical necessity for Medicare patients. Funding for these programs will come from 25% of recoupments

Allow HHS to ensure that all suppliers are audited at least once every two years and those with low error rates can be excused from some or all audits during that two year period. DMEPOS suppliers with a 15% or below audited clams error rate will be subject to only 1 claim audit a year

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Audits – Air ActRequire Medicare Contractor

transparency and reporting Limit documentation review periods

to 3 years for all Medicare audits For reoccurring claims, the Secretary

shall toll the timely claim filing limits so DMEPOS suppliers are not prohibited from taking an audited claim through the entire appeals process on the basis that the timely claim filing limits have expired

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PMD Prior Authorization Demo Current program began September 1, 20123 year program – Ends August 31,

2015Began in 7 states (CA, FL, IL, MI,

NC, NY, TX) 47% of PMD claims

Monthly expenditure decrease of $20M to $9M in non-demo states, vs $12M to $4M in demo states

Oct 1, 2014, 12 more states: AZ, GA, IN, KY, LA, MD, MO, NJ, OH, PA, TN, WA

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PMD Prior Authorization Demo “Reduce improper payments for PMDs”

Reduce the “pay and chase” method

Process to allow suppliers to know if Medicare coverage criteria are met for the PMD before delivery Review of beneficiary’s medical condition and

documentation to determine if existing coverage guidelines are met

http://www.cms.gov/Research-Statistics-Data-and-Systems/Monitoring-Programs/Medicare-FFS-Compliance-Programs/Medical-Review/PADemo.html

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PMD Prior Authorization Demo All power operated vehicles (K0800–K0802;

K0812) All standard power wheelchairs (K0813–

K0829) All Group II complex rehab power wheelchairs

(K0835–K0843) All Group III complex rehab power wheelchairs

without power options (K0848–K0855) Group III complex rehab chairs with power options

(K0856–K0864) are excluded

All pediatric power wheelchairs (K0890–K0891)

Miscellaneous power wheelchairs (K0898)

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PMD Prior Authorization Demo PA is required for all power wheelchairs

Non-compliance results in 25% payment reduction and automatic pre-payment review

PA is not required for claims submitted with GA, GY or EY modifiers (not medically necessary or non-covered)

Required documentation F2F examination Seven-element order Detailed product description Relevant and necessary clinical information

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PMD Prior Authorization Demo Medical Review reviews and issues decision

Affirmative decision (14-digit unique tracking number – UTN)

Non-affirmative decision

Rejection

Decisions are sent to the supplier, patient and physician

Initial requests Post mark notification within 10 business days

from initial request

Resubmitted requests Post mark notification within 20 business days

from request

No limit on number of resubmissions

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Face-to-Face Exam for DME Final rule in November 16, 2012 Federal Register.

Requires a physician or other practitioner “face-to-face” exam prior to ordering certain DME.

Originally effective for new orders July 1, 2013 CMS delayed enforcement until October 1, 2013

Delayed again until sometime in 2014 (09/09/13)

WOPD requirement enforced beginning on January 1, 2014

Doctor, PA, NP, or CNS – LEGISLATIVE CHANGE? Doctor must document and communicate to the

DME supplier that the Doctor, PA, NP or CNS did a F2F.

F2F must occur within 6 months prior to the order.

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Face-to-Face Exam for DME F2F must include a needs assessment,

evaluation and/or treat the beneficiary for the medical condition that supports the need for the DME ordered

F2F must be documented in the medical record CMS “discourages” the use of templates Physician must sign Or co-sign the medical record when done by a

NP, PA, or CNS A signed order does not satisfy this

requirement Other signature requirements (legibility) apply

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Face-to-Face for DME

For items that do not require a written order prior to delivery, suppliers are allowed to dispense DME to the beneficiary based upon a verbal order

BUT the supplier must have the written order before submitting claim

For items that do require written order prior to delivery, supplier must have the written order, with face-to-face documentation, prior to delivery and when submitting claim

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Face-to-Face for DME

Supplier must maintain the written order and supporting documentation and make available to CMS upon request for 7 years

Beneficiaries discharged from the hospital do not require a separate F2F encounter, as long as the physician or treating practitioner who performed the F2F in the hospital issues the DME order within 6 months after the date of discharge

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Face-to-Face for DME

Minimum elements for the order:Beneficiary's name Item of DME ordered Prescribing practitioner NPI Signature of the prescribing

practitioner The date of the order

Removed beneficiary diagnosis and usage instructions

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Face-to-Face for DMEE0185 E0297 E0464 E0656 E0748 E0969 E1008 E1237E0188 E0300 E0470 E0657 E0749 E0971 E1010 E1238E0189 E0301 E0471 E0660 E0760 E0973 E1014 E1296E0194 E0302 E0472 E0665 E0762 E0974 E1015 E1297E0197 E0303 E0480 E0666 E0764 E0978 E1020 E1298 E0198 E0304 E0482 E0667 E0765 E0980 E1028 E1310E0199 E0424 E0483 E0668 E0782 E0981 E1029 E2502E0250 E0431 E0484 E0669 E0783 E0982 E1030 E2506E0251 E0433 E0570 E0671 E0784 E0983 E1031 E2508 E0255 E0434 E0575 E0672 E0786 E0984 E1035 E2510 E0256 E0439 E0580 E0673 E0840 E0985 E1036 E2227E0260 E0441 E0585 E0675 E0849 E0986 E1037 K0001 E0261 E0442 E0601 E0692 E0850 E0990 E1038 K0002 E0265 E0443 E0607 E0693 E0855 E0992 E1039 K0003 E0266 E0444 E0627 E0694 E0856 E0994 E1161 K0004 E0290 E0450 E0628 E0720 E0958 E0995 E1227 K0005 E0291 E0457 E0629 E0730 E0959 E1002 E1228 K0006 E0292 E0459 E0636 E0731 E0960 E1003 E1232 K0007 E0293 E0460 E0650 E0740 E0961 E1004 E1233 K0009 E0294 E0461 E0651 E0744 E0966 E1005 E1234 K0606 E0295 E0462 E0652 E0745 E0967 E1006 E1235 K0730 E0296 E0463 E0655 E0747 E0968 E1007 E1236

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Resources & Information

dmecompetitivebid.com

Invacare’s Washington Updates & Policy & Funding Sections on

the Web

www.invacare.com

(click on Invacare Homecare)

cbachenheimer@invacare.com

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