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SPONSOR MESSAGE Improve Operating Efficiency and Lower DSO AnCor Healthcare Consulting provides A/R related services that assist HME/IV providers improve workflow, business processes and organizational structure designed to efficiently and effectively obtain reimbursement for services/items you have provided. Visit our booth, #1320 at MedTrade West and plan to attend Karen Moore's seminar, "Meeting the Challenge of Improving Your Reimbursement" on Wednesday, April 24 at 8:30 am in room 301. The seminar will provide you with valuable information to assist you in improving your reimbursement activities. For more information call (954) 757-3121 or visit us online at www.ancorconsulting.com For more industry news, featured articles and highlights from our latest issue, please visit our website at www.homecaremag.com

Week of April 15, 2024

HEADLINE NEWS House to Propose Competitive Bidding for Part B Drugs WASHINGTON--The U.S. House Ways and Means Committee currently is drafting a proposal to implement competitive bidding for Medicare Part B drug reimbursement, according to the Bureau of National Affairs. While the Ways and Means Committee told HomeCare it is not yet ready to comment on the proposal, a spokeswoman for the committee reaffirmed Committee Chairman Bill Thomas' support for the competitive bidding model. Prices for Part B drugs--which include inhalation and infusion drugs--have drawn harsh criticism on Capitol Hill recently. Last month, the U.S. Senate's Finance Health Subcommittee heard heated testimony on the practice of using the average wholesale price, or AWP, to calculate Medicare reimbursements for Part B drugs. Currently, CMS reimburses inhalation and infusion drugs at a rate of 95 percent of the AWP. However, government studies have found that the AWP far exceeds what most doctors and suppliers pay for the drugs--in some cases by as much as 65 percent. In fact, the U.S. Health and Human Services Department's Office of Inspector General last month concluded that Medicare could save as much as $543 million annually by cutting reimbursements for the inhalation drugs albuterol and ipratropium bromide. But the Alexandria, Va.-based American Association for Homecare has cautioned lawmakers not to oversimplify the AWP issue. Before slashing reimbursements for inhalation and infusion drugs, Medicare should consider the hidden costs of providing these drugs, AAHomecare's president, Tom Connaughton, said in a letter to the Senate's Finance Health Subcommittee. "The acquisition cost of the drug is only a fraction of the overall cost of caring for these patients at home," he explained. According to the Bureau of National Affairs, the Ways and Means Committee's competitive bidding proposal would address these concerns by ensuring that "bids for durable medical equipment products, such as home infusion therapy, would cover the cost of product delivery, repair calls and beneficiary training." The Ways and Means Committee expects to unveil this proposal, as part of its Medicare prescription drug and reform bill in the weeks ahead. More than Ever, Chronically Ill Children are Dying at Home, Study Finds SEATTLE--After reviewing data on child deaths in Washington, a group of doctors at Seattle's Children's Hospital have determined that children with complex chronic conditions increasingly are dying at home. Looking at death certificates and U.S. Census data on 31,445 child deaths that occurred in Washington between 1980 and 1998, researchers found that the number of home deaths more than doubled for chronically ill children older than 1 year, from 21 percent of all deaths among chronically ill children in 1980 to 43 percent in 1998. "Our study underscores the fact that, whether planned or not, children with serious chronic conditions [such as congenital, genetic, neuromuscular, metabolic and cancer-related conditions] increasingly are dying at home," said lead author Chris Feudtner. "Home is therefore where we need to care for them. To do this, our health care system must enhance its capacity to provide community-based supportive services in the home." The increasing rate of home deaths among chronically ill children could be attributable to the fact that these children and their families prefer to remain at home, according to Jeff Hunsicker, president of Monterey, Calif.-based Pari Respiratory Equipment, a company that works with children suffering from cystic fibrosis. "There's value in the clinical setting for routine visits and checkups, but as far as managing the disease goes, my impression is that [chronically ill children and their families] would prefer not to have to go into the hospital," he said. "They don't want to go to the hospital because it's traumatic and takes them out of their routine." Another factor that affected whether chronically ill children would die at home was income, the study found. "Children who had lived in more affluent neighborhoods were more likely to die at home," the Children's Hospital said in a press release. Additionally, geography seemed to play a role in determining where chronically ill children would spend their final days. "Depending upon where they lived in the state, children had different chances of dying at home," the release said. To read the study, which appears in April's edition of the journal Pediatrics, go to http://www.pediatrics.org/current.shtml#ARTICLE, and scroll down to the article entitled, "Where Do Children With Complex Chronic Conditions Die? Patterns in Washington State, 1980--1998." DMERCs Must Develop Fees for New Ostomy Codes, Medicare Says BALTIMORE--By July 1, 2002, Medicare's four durable medical equipment regional carriers must develop fee schedules for a series of new ostomy codes--numbers KO561 through KO580--according to a recent memorandum from the Centers for Medicare and Medicaid Services. Specifically, CMS asked the carriers to "gap-fill" the base fee schedules for these codes, which means the carriers now must research regional prices for similar supplies, develop a comparable local rate for the new codes and submit these rates to the national Medicare office, a CMS spokeswoman told HomeCare. CMS also instructed the carriers to adjust any previously processed KO561 through KO580 claims bearing dates of service on or after Jan. 1, 2002, if providers resubmit these claims. To read this memorandum, go to http://www.hcfa.gov/pubforms/transmit/memos/comm_date_dsc.htm, and click on the April 5 file, entitled A-02-027.

PROVIDER NEWS Apria to Settle $43M Class Action Suit LAKE FOREST, Calif.--At a court hearing tomorrow, Apria Healthcare will present final documents in a $43 million class-action settlement to the Orange County, Calif. Superior Court, according to the company's annual report. The tentative settlement covers two consolidated federal and state class-action lawsuits filed in 1998 and 1999 on behalf of Apria's common-stock shareholders. Under the terms of the settlement, Apria has agreed to contribute $1 million to a settlement pool. The $42 million balance will come from the company's insurance carriers, the report said. Apria also has agreed to provide indemnities to eligible current and former company officers. "In the opinion of Apria's management, the ultimate disposition of these class actions will not have a material adverse effect on Apria's results of operations or financial condition," the report concluded. O2 Science Acquires RCC Medical TEMPE, Ariz.--To expand its existing Colorado business, O2 Science has acquired RCC Medical of Arvada, Colo., which provides home medical equipment and respiratory therapy to Denver- and Boulder-area residents. "[RCC Medical] will help round out our abilities to provide the people of Colorado with expert health care and services," said Mark Hanley, O2's president and chief executive officer. "Our strategy is to become a large regional provider of home health care services in key geographic markets." Currently, O2 Science operates from 13 locations in Nebraska, Colorado, Arizona, California, Nevada and Kansas. SEC Ends Probe into Liberty Medical Supply's Parent Company WOBURN, Mass.--On April 8, PolyMedica--the parent company of home medical equipment provider Liberty Medical Supply--announced that the Securities and Exchange Commission has ended its investigation into PolyMedica's finances. In concluding a four-month investigation, the SEC did not recommend enforcement action, according to a PolyMedica press release. In light of this announcement, PolyMedica's stock price nearly doubled on April 9. MANUFACTURER NEWS Abbott Labs Announces Q1 Results NORTH CHICAGO, Ill.--For the first quarter ended March 31, 2002, Abbott Laboratories has announced net earnings of $854 million, or 54 cents per diluted share, compared to a loss of $224 million, or a loss of 14 cents per diluted share, for the same quarter in 2001. Worldwide sales for the quarter rose 17.7 percent to $4.19 billion, compared to $3.56 billion during the first quarter of 2001. ResMed Sells Australian Facility SAN DIEGO-- ResMed has sold its Sydney, Australia-based facility for $18 million and has negotiated a three-year leaseback agreement, according to a company press release. The company will use some of the resulting $5.6 million profit to construct a new facility in NorWest Business Park, northwest of Sydney. Pride Launches Television Campaign EXETER, Pa.--Pride Mobility has launched its Jazzy Provider Marketing Partner Program. Under the program, among other services, Pride-affiliated providers have a choice of Jazzy television commercials to run in the providers' respective markets.

SOURCES SAY WASHINGTON--Last week, Medicare Administrator Tom Scully defied a subpoena to testify before the U.S. House Small Business Committee, citing frustration with the committee's witness protocol. "I had been looking forward to the opportunity of appearing today before your committee to discuss [regulatory flexibility for small businesses] and respond to members' questions," he wrote in an April 10 letter to the committee chairman, Donald Manzullo, R-Ill. "I was, however, extremely disappointed upon receiving your witness list Monday to find that the courtesy of allowing senior administration officials to appear on a separate panel was not to be honored by the committee. . . . Given the structure of the panel on which the committee has insisted, I regret that I will not be able to attend." Although Scully did show up at the hearing, he left shortly after arriving, without testifying. Afterward, Manzullo called for Scully's resignation, and congressional sources tell HomeCare the Small Business Committee is considering voting Scully in contempt of Congress. The next day, Tommy Thompson, secretary of the U.S. Department of Health and Human Services--which oversees Medicare--promised in a news conference that Scully will testify before the committee. FRANKLIN, Tenn.--Many in the banking industry are not prepared to comply with sweeping medical privacy legislation set to take effect in October 2003, according to a recent study from the Medical Banking Project. In surveying 18 of the country's largest banks--which are among those poised to handle huge volumes of digital medical payments for health care providers in the near future--the Medical Banking Project found that 94.1 percent either did not know whether the privacy law would impact their banking operations or said they needed further government guidance. By conducting this study, the Medical Banking Project hopes to raise banks' awareness of privacy issues and ultimately to encourage progress in the field of electronic data interchange, according to founder John Casillas. "We are trying to communicate a vision to medical banking constituencies. We believe that digitizing medical payment channels will result in greater support for hospitals and other providers that have charitable missions in their communities," Casillas explained. "The cost reduction that EDI offers is substantial." WASHINGTON--The U.S. Justice Department is suing the world's largest concert promoter, SFX Entertainment, for allegedly prohibiting diabetics from bringing insulin supplies into concerts. Filed in the U.S. District Court for Philadelphia, the lawsuit alleges that SFX violated the Americans with Disabilities Act by establishing a discriminatory policy against insulin-dependant diabetics. "Individuals with diabetes are entitled to attend and enjoy community events, like anyone else, without putting their lives at risk," said Ralph Boyd, assistant attorney general for civil rights. "SFX's policy is unnecessary and reflects outdated fears about individuals with disabilities. Our goal is to foster integration of the disabled into society at large, and this suit will further that goal." The Justice Department said it filed the lawsuit after SFX refused to negotiate a voluntary settlement. In addition to eliminating the discriminatory policy, the lawsuit seeks civil penalties and compensatory damages for the individuals harmed by the policy. RARITAN, N.J.--Although thousands of diabetics lose lower limbs each year as a result of preventable foot ulcers, a recent study from the American Diabetes Association found that 26 percent of diabetics had never heard of diabetic foot ulcers. "The survey of 500 adults with type 1 or type 2 diabetes revealed that 26 percent had never heard of diabetic foot ulcers, another 21 percent said they did not know very much about them and 2 percent said they knew 'nothing at all' about them," according to an ADA press release. "If more people knew how to recognize the signs of diabetic foot ulcers and got proper treatment immediately--before an infection can set in--many amputations could be avoided," said Vincent Ciacalone, a member of the American Podiatric Medical Association's Diabetes Advisory Board.

INDUSTRY BRIEFS Thomas Miklich, chief financial officer for Elyria, Ohio-based Invacare, has resigned. Miklich, who had been Invacare's CFO and chief counsel since 1993, has accepted a position as CFO of the Cleveland-based O.M. Group, a producer and marketer of metal-based specialty chemical products. No replacement for Miklich has been named. David Kylen, president and chief executive officer of Computer Applications Unlimited in Harrisburg, Pa., retired April 5. Terrance Dinsmore, original partner, vice president and chief operating officer of CAU, will replace Kylen as president and CEO. The Alexandria, Va.-based American Association for Homecare has promoted Asela Cuervo to general counsel and senior vice president of government relations. The organization also has promoted James Jorkasky to senior vice president of membership and strategic development. Santa Barbara, Calif.-based Inamed has named Kathryn Falberg its executive vice president and chief financial officer. Falberg had been serving as a financial consultant to Inamed since 2001. Also, Inamed has named Ronald Ehmsen its vice president, clinical and regulatory affairs. Ehmsen previously was senior director, regulatory and clinical affairs for the Nellcor and Puritan Bennett divisions of Tyco Healthcare. Coloplast, Atlanta, has restructured its breast care activities into a single business unit headquartered in Atlanta. Leading the unit are Jens Stovgaard, president, breast care; David Heffner, executive vice president, responsible for global sales; and Jay Markowitz, vice president of sales and marketing, responsible for U.S. sales. The remainder of Coloplast's United States operations, including Medical Sales, Sterling Medical and Skin Care, will be directed by Donald Looney, president. John Howard has been appointed sales representative for New York City and Long Island for Minneapolis-based Otto Bock. Howard previously was a rehabilitation technical specialist for Rehabco, and C and C Home Care in New York. Also, Sharon Baldauf has been appointed customer satisfaction manager for Otto Bock. IN OTHER NEWS Buffalo, N.Y.-based AirSep last week announced it has received 510(k) clearance from the U.S. Food and Drug Administration for the LifeStyle Portable Oxygen Concentrator. The company also has begun to sell the device overseas. Atlanta-based CareCentric's MestaMed billing and operations system has been approved for ANSI 4010 electronic claims file readiness for HIPAA by the Region D durable medical equipment regional carrier, Cigna Medicare. The Rehabilitation and Technology Council of the Alexandria, Va.-based American Association for Homecare has implemented an initiative to fund the development of new standards and measurement tools to be used by and applied to rehabilitation technology companies. The standards will be part of an accreditation program for rehab companies that differentiates them from home or durable medical equipment providers. For more information, contact Mary-Lacey Reuther, executive director of RATC, by telephone at (703) 535-1892 or by e-mail at [email protected]. O2 Science, a respiratory and home medical equipment provider based in Tempe, Ariz., has opened a new location in Grand Island, Neb. Corey Keezer, registered respiratory therapist, will be general manager. The address for the Grand Island branch is 2538 St. Patrick Ave. Al Thieme, president and chief executive officer of Amigo Mobility in Bridgeport, Mich., has been presented an award for distinguished service on the Northwest Airlines Customer Service Advisory Board on Disability. The San Francisco-based American Society on Aging and Hunter College's Brookdale Center on Aging have awarded a Best Practices in Human Resources and Aging Award to one company and nine non-profit organizations for their part in developing a caregivers training manual. The manual, titled "Caring to Help Others: A Training Manual for Preparing Volunteers to Assist Caregivers of Older Adults" was created by Eisai, a pharmaceutical company based in New Jersey; the American Association for Retired Persons; the Alzheimer's Association-Greater New Jersey chapter; the Hospice Association of America; the Interfaith Caregivers Alliance; the National Alliance for Caregiving; the National Association for Home Care; the National Council on the Aging, the National Family Caregivers Association; and the Towson University Department of Gerontology.

STOCKS Walgreen, Deerfield, Ill., has declared a regular quarterly dividend of 3.625 cents per share, payable June 12 to shareholders of record on May 21, 2002. Investment firm Fulcrum has initiated coverage on Johnson and Johnson, New Brunswick, N.J., at a "buy" rating. And investment firm A.G. Edwards has downgraded Johnson and Johnson from a "buy" to a "hold" rating. Company High Low PE Ratio 4/5/02 4/12/02 Change Abbott Laboratories 58.00 44.16 32.23 N/A 53.69 N/A Allied Healthcare (AHPI) 5.30 3.00 128.75 5.25 5.00 (0.25) American HomePatient (AHOM.OB) 1.70 0.25 N/A 0.57 0.60 0.03 AmerisourceBergen (ABC) 72.00 50.00 30.43 66.07 68.92 2.85 Apria Healthcare (AHG) 29.85 19.50 20.54 25.05 27.00 1.95 Cardinal Health (CAH) 77.32 60.30 34.16 68.28 68.57 0.29 CareCentric (CURA) 3.00 0.46 N/A 0.70 0.75 0.05 Chad Therapeutics (CTU) 4.35 0.75 N/A 3.35 3.27 (0.08) Coram Healthcare (CRHEQ.OB) 0.76 0.13 N/A 0.51 0.47 (0.04) Gentiva Health Services (GTIV) 26.19 15.60 30.00 25.05 25.64 0.59 Invacare (IVC) 41.25 28.50 34.41 38.20 38.31 0.11 Johnson and Johnson (JNJ) 65.89 45.06 34.08 63.05 62.67 (0.38) Lincare Holdings (LNCR) 34.39 22.25 24.84 29.24 31.28 2.04 Matria Healthcare (MATR) 40.00 12.66 28.37 25.04 24.40 (0.64) McKesson (MCK) 41.50 25.16 90.60 35.18 36.62 1.44 National Home Healthcare (NHHC) 19.85 6.10 13.37 12.01 13.85 1.84 Option Care (OPTN) 22.15 8.68 25.97 18.12 18.99 0.78 Pediatric Services of America (PSAI) 14.10 4.70 16.45 11.50 11.01 (0.49) Praxair (PX) 61.11 36.50 22.44 57.02 59.17 2.15 ResMed (RMD) 62.20 35.20 86.33 38.68 39.02 0.34 Respironics (RESP) 37.88 23.79 26.71 31.55 33.00 1.45 Transworld Healthcare (TWH) 4.83 2.21 N/A 4.02 4.02 0.00 Tyco (TYC) 60.09 22.00 10.72 31.80 30.60 (1.20) Walgreen (WAG) 44.30 28.70 41.85 39.60 39.24 (0.36)

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