Sponsors

		Free Subscriptions
		Subscribe to HomeCare Magazine Subscribe to HomeCare Monday Weekly eNewsletter

SPONSOR MESSAGE CU Image 4.0, produced by Computers Unlimited of Billings, MT, is a document imaging system that is fully integrated with TIMS. It allows the capture of any document (i.e. CMNs, authorization forms, AOBs) for storage, retrieval and viewing. Store patient files electronically for easier viewing, printing and faxing without having to leave your desktop. For more information, call (406) 255-9500 or visit us online at www.cu.net For more industry news, featured articles and highlights from our latest issue, please visit our website at www.homecaremag.com

Week of February 11, 2024

HEADLINE NEWS President Proposes Nationwide Competitive Bidding WASHINGTON--President Bush's 2003 budget, released last week, calls for a nationwide competitive bidding system for durable medical equipment, prosthetics and orthotics. Recalling the rhetoric that justified competitive bidding demonstrations in Florida and Texas, the budget says, "Medicare pays too much for medical equipment such as hospital beds and oxygen, as well as for prosthetics and orthotics. The budget proposes a nationwide competitive bidding system for this equipment to encourage suppliers to provide quality services and supplies at lower prices than what Medicare currently pays."n a Jan. 4 opinion, the court dismissed Reliable Home Health Care's lawsuit that alleged the U.S. Department of Health and Human Services violated the home health agency's Fifth Amendment rights when calculating the company's fines during an overpayment investigation. As certain as this proposal sounds, however, Asela Cuervo, vice president and general counsel for the Alexandria, Va.-based American Association for Homecare, cautioned DME providers to put the President's budget in context. "Every budget since about 1999 has proposed national competitive bidding," she said. "So, every year the President makes the same proposal." Still, AAHomecare is taking the President's proposal very seriously, especially in light of current economic trends. "This year, [the Centers for Medicare and Medicaid Services] really is under pressure--and the President is, too--to find savings in the Medicare program," Cuervo explained. In a Feb. 7 press release, Tom Connaughton, AAHomecare's president and chief executive officer said, "AAHomecare has a number of concerns with the budget proposal. . . . Besides the fact that the numbers cited and the extrapolations from those numbers are extremely questionable, the administration has failed to recognize that administering a competitive bidding program on a national basis is not possible if it truly wants to ensure a choice of providers for beneficiaries." Nonetheless, the political tide seems to be turning in favor of competitive bidding. At a Feb. 5 press conference, CMS Administrator Tom Scully touted a 17 percent savings rate in Polk County, Fla., and San Antonio, as a result of competitive bidding, and said he believes CMS could achieve the same rate nationwide.

PROVIDER NEWS Eight Charged in Florida Medicare Fraud Scheme TAMPA, Fla.--The U.S. District Court for the Middle District of Florida on Jan. 17 indicted eight individuals in a $25 million durable medical equipment fraud scheme. According to the indictment, the individuals--most of whom live in Tampa, Fla.--allegedly submitted inappropriate claims to Medicare for DME the defendants did not provide, for DME that was not medically necessary and for DME that cost more than the actual products the defendants provided to beneficiaries. Additionally, the defendants allegedly forged physicians' signatures and "laundered" Medicare payments "into off-shore bank accounts through other corporations owned or controlled by the defendants," the indictment said. Defendants in the case include Barry Haught, Ernest Sleeth, Fred Ford, and Teresa Martinez of Tampa, Renee LaChance Hunter Livio of New Port Richey, Fla., Thomas Nespeca of Odessa, Fla., Christopher Stursburg of Lutz, Fla., and Cherry Moody of New Orleans.

MANUFACTURER NEWS Tyco: Bard Takeover Halts, Shareholders Sue PEMBROKE, Bermuda--Two weeks after announcing plans to split into four separate companies, Tyco International on Feb. 6 cancelled plans to purchase medical device manufacturer C.R. Bard of Murray Hill, N.J. In a press release, Tyco said the two companies have "mutually terminated" their merger agreement and that each party will bear its own costs. Additionally, the companies will not pay a break-up fee, Tyco said. That same day, the New York-based law firm Lovell and Stewart announced it had filed a class action suit against Tyco, on behalf of "all persons who purchased or otherwise acquired the common stock of Tyco International between Feb. 1, 2000, through Feb. 1, 2002." The complaint alleges that Tyco misrepresented its finances to the market during the two-year time period, thereby artificially inflating the company's stock price. Chad Releases Third Quarter, Nine Months Results CHATSWORTH, Calif.--For the third quarter ended Dec. 31, 2001, Chad Therapeutics reported a net income of $81,000, or 1 cent per diluted share, compared to a loss of $856,000, or 9 cents per diluted share, for the same quarter a year ago. The company's nine months earnings were $161,000, or 2 cents per diluted share, compared to a loss of $2,261,000, or 23 cents per diluted share, for the same period a year ago. CareCentric Announces Strategy Shift, Layoffs ATLANTA--CareCentric last week announced plans to "realign" its business, by devoting substantial resources to product development. Funds for the initiative will come in part from the elimination of 40 staff positions, according to John Festa, CareCentric's president and chief executive officer.In the future, the company will market its bath safety, ambulatory and pressure management product lines under the brand name Lumex.These results exclude special charges, the company said. "This reallocation will allow CareCentric to direct these resources toward investment in future product platforms and new research and development initiatives," he added.

SPOTLIGHT Medicare Appeals System Not Ready for Change, OIG Says WASHINGTON--Already buried under a backlog of pending cases, Medicare's administrative appeals system is not prepared to handle changes slated to take effect in October 2002, according to the U.S. Health and Human Services Department's Office of Inspector General. The changes, mandated by Section 521 of the Benefit Improvement and Protection Act of 2000, would establish a uniform appeals process for handling all Part A and Part B Medicare claims, and would shorten the appeals process significantly. But this statute makes promises the current system cannot keep, the OIG said in a January report. "The current Medicare appeals system is backlogged, overwhelmed and untimely, and the problems could be exacerbated by BIPA provisions," the report explained. Additionally, the OIG predicted that BIPA would make the appeals system less accessible to the Medicare beneficiaries it was created to serve. The current appeals system, outlined in Section 1869 of the Social Security Act, is designed to be "user friendly" for individual Medicare beneficiaries who seek reimbursement for rejected claims. However, in recent years, health care providers' cases have dominated the system. And the new system, mandated by BIPA, may further hamper beneficiaries' access to the appeals process while at the same time making the process easier for providers, OIG warned. Before implementing BIPA's provisions, HHS should revamp its current appeals system, the report concluded. To this end, the OIG recommended that HHS: --Delay implementation of Section 521 of BIPA, by seeking legislation to revise the statute's effective date; --Establish a separate administrative appeals process dedicated specifically to Medicare, because the current system borrows administrative law judges from the U.S. Social Security Administration; --Modify the time frames mandated by BIPA "to provide adequate time for fair and effective processing, but ensure timely and efficient resolution of appeals;" --Train all Medicare claims reviewers and require the reviewers to apply uniform standards; --Create formal lines of communication between all levels of the appeals process, from the regional carriers to the administrative law judges to the Medicare Appeals Council to the U.S. District Courts; and --Modernize the system's processing mechanisms by enhancing manual files with electronic features. Generally, HHS Secretary Tommy Thompson agreed with these recommendations. In its formal response to the OIG's report, the Secretary's office said that the appeals process needs "a complete restructuring to resolve serious shortcomings of the appeals system, before Section 521 of [BIPA] becomes effective." To reform its backlogged Medicare appeals system, HHS plans to: --Build on the appeals model that BIPA outlines; --Achieve a more timely, efficient and less expensive administrative review process; and --Achieve consistency among the appeals decisions. Despite these lofty goals, HHS currently does not have the money to implement changes to its administrative appeals system, according to a spokesman from the Centers for Medicare and Medicaid Services. And, while President Bush's 2003 budget calls for Medicare reform, it does not fund changes to the appeals process. Currently, HHS representatives are talking to legislators about BIPA-related issues, but a CMS spokesman reports there is no official plan. To read OIG's report, go to http://oig.hhs.gov/oei/whatsnew.html, and scroll down to the report entitled, "Medicare Administrative Appeals: The Potential Impact of BIPA."

SOURCES SAY WASHINGTON--At a Congressional hearing on aging and women's issues last week, a number of female U.S. Senators and other health care experts testified on the burdens that aging women face--first as caregivers, and second as care-receivers. After listening to the testimony, Sen. John Breaux, D-La., chairman of the Senate Special Committee on Aging, said, "Women spend roughly 35 years of their lives caring for parents and children. The testimony we heard today illustrates that our public policies do far too little to address the concerns of women as they age. Since women bear so much of the caregiving burden, we must take a harder look at developing legislative initiatives, like a cohesive long-term care system, that recognize the role of caregivers." BORDEAUX, France--A group of French researchers has reported that pacemakers can reduce the symptoms of obstructive sleep apnea, a condition wherein a person's airways close during sleep. By using a pacemaker to increase sleep apnea patients' heart rate during sleep, the researchers found that, "in patients with sleep apnea syndrome, atrial overdrive pacing significantly reduces the number of episodes of central or obstructive sleep apnea without reducing the total sleep time." The Washington-based National Institutes of Health predict that OSA affects more than 18 million people in the United States, causing heart problems, daytime fatigue and behavioral impairment. To read more about this study, visit the New England Journal of Medicine at http://content.nejm.org/, and read the current issue. WASHINGTON--Some health policy experts are calling President Bush's Medicare growth projections unrealistic, according to The New York Times. In his 2003 budget, the President predicts that Medicare spending will increase by 73 percent during the next decade. However, the U.S. Congressional Budget Office predicts that Medicare spending will double during the next decade. One reason for underestimating Medicare's growth rate could be that "the administration produces a more favorable overall budget picture by forecasting lower rates of growth in Medicare," John Rother, policy director at the American Association for Retired People told the Times. WASHINGTON--There is hope for Americans at risk for developing type 2 diabetes, according a Feb. 6 report from the U.S. Health and Human Services Department's National Institute of Diabetes and Digestive and Kidney Diseases. "By adopting a moderate, consistent diet and exercise program, many people with one or more of the risk factors for type 2 diabetes can stop the disease before it becomes irreversible," said Tommy Thompson, HHS secretary. Researchers compared three approaches--lifestyle modification, diabetes drug treatment and standard medical advice--to treating 3,234 overweight people with impaired glucose tolerance and found that lifestyle modification was the most effective approach. To read more about this study, visit http://www.nih.gov/news/pr/feb2002/hhs-06.htm.

INDUSTRY BRIEFS Elizabeth Hirsch has been named director, investor relations for Danbury, Conn.-based Praxair. Hirsch previously worked at Praxair as director of corporate finance and as assistant treasurer. She succeeds Scott Cunningham, who has been appointed the company�s assistant treasurer. A and D Medical, a manufacturer of blood pressure monitors, thermometry products and scales in Milpitas, Calif., has named Gary Halick vice president of medical business. Halick has held marketing and sales management positions at McKesson, Fresenius, C.R. Bard and Becton Dickinson. West Coast Wheelchairs of Reedley, Calif., has joined Lubbock, Texas-based The Med Group as a full-service member. Peter Nicholson has been appointed vice president of investor relations and corporate communications for Santa Barbara, Calif.-based Inamed. The Accreditation Commission for Health Care, based in Raleigh, N.C., has appointed Alan Lassiter as executive medical director. Lassiter is the former chief executive officer of Cook Children�s Physician Network, a multi-specialty pediatric group in Texas.

IN OTHER NEWS If you correspond with AdminiStar Federal, the Region B durable medical equipment regional carrier, you may want to check your address book. According to a statement on the company's Web site, http://www.administarfederal.com, DMERC suppliers have been sending mail to two incorrect addresses: 6802 Hillsdale Court and 2307 Directors Row, both in Indianapolis. The DMERC said it is not responsible for mail sent to an incorrect address. The correct address for the Region B DMERC is AdminaStar Federal, DMERC Operations, P.O. Box 7078, Indianapolis, Ind., 46207. Boca Raton, Fla.-based Innomed Technologies has entered into agreements with two distributors to market Innomed�s new Nasal Aire interface to home health care organizations in the United States and abroad. Adel, Iowa-based Medical Industries of America will market the product in the United States, while Lenexa, Kan.-based CareFore Medical will market the product in the Far East, Mexico and Australia. Innomed�s Nasal Aire interface wears like an oxygen cannula and requires no headgear. The National Rehab Network of the Lubbock, Texas-based The Med Group this year will hold training sessions for rehabilitation technology suppliers in Tampa, Fla., Denver, Dallas and Cleveland. The training sessions offer direct training to RTS�s on product applications, time management and relationship building. The National Rehab Network plans to hold smaller, targeted sessions in other cities.Huntleigh Healthcare, Eatontown, N.J., has signed a two-year contract to supply therapeutic support surfaces and diagnostic dopplers to Fort Smith, Ark.-based Beverly Enterprises, a provider of post-acute health care services.

STOCKS Investment firm Deustche Banc Alex Brown has initiated coverage on Pittsburgh-based Respironics at a "buy" rating. Cardinal Health, Dublin, Ohio, has declared a quarterly dividend of $0.025 per common share, payable April 15 to shareholders of record on April 1.

Company High Low PE Ratio 2/1/02 2/8/02 Change Allied Healthcare (AHPI) 3.95 3.00 N/A 3.85 3.68 (0.17) American HomePatient (AHOM.OB) 1.70 0.16 N/A 0.56 0.46 (0.10) AmerisourceBergen (ABC) 72.00 42.00 27.52 63.78 63.00 (0.78) Apria Healthcare (AHG) 29.85 19.50 18.91 24.34 23.85 (0.49) Cardinal Health (CAH) 77.32 56.67 32.09 65.93 64.59 (1.34) CareCentric (CURA) 4.53 0.46 N/A 0.85 0.92 0.07 Chad Therapeutics (CTU) 3.70 0.69 N/A 3.05 3.00 (0.05) Coram Healthcare (CRHEQ.OB) 0.76 0.13 N/A 0.60 0.64 0.04 Gentiva Health Services (GTIV) 25.50 14.50 12.90 24.00 24.60 0.60 Horizon Pharmacies (HZP) 1.30 0.10 N/A 0.00 0.00 0.00 Invacare (IVC) 41.25 28.50 29.38 33.15 33.50 0.35 Johnson and Johnson (JNJ) 60.97 40.25 30.70 57.60 56.88 (0.72) Lincare Holdings (LNCR) 34.39 22.25 22.23 26.61 28.10 1.49 Matria Healthcare (MATR) 40.00 11.81 26.66 23.95 22.62 (1.33) McKesson (MCK) 41.50 23.40 92.38 38.20 36.45 (1.75) National Home Healthcare (NHHC) 19.85 5.12 12.84 10.75 11.20 0.45 Option Care (OPTN) 22.15 5.75 23.68 16.81 17.32 0.52 Pediatric Services of America (PSAI) 11.50 4.56 16.58 10.75 10.20 (0.55) Praxair (PX) 58.21 36.50 21.15 57.25 56.28 (0.97) ResMed (RMD) 62.20 36.25 85.93 39.98 40.53 0.55 Respironics (RESP) 37.88 22.94 20.22 27.95 25.80 (2.15) Transworld Healthcare (TWH) 4.83 2.21 N/A 3.80 3.85 0.05 Tyco (TYC) 62.00 22.00 10.35 36.87 29.88 (6.99) Walgreen (WAG) 45.29 28.70 41.56 35.54 37.10 1.56

Visit this week's sponsor at: www.cu.net

HomeCare Monday� is produced weekly by the editors and staff of HomeCare Magazine and HomeCare Extra. It is e-mailed on Monday 46 times a year by PRIMEDIA Business Magazines & Media 800/441-0294