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Week of January 14, 2024

HEADLINE NEWS Power Mobility Coalition Working With CMS to Sort Out Reimbursement Issue WASHINGTON--There is a movement under way to encourage Medicare flexibility, and to address the issues of ever-changing rules and the resulting backlash against providers, according to the Washington-based Power Mobility Coalition. Stephen Azia, counsel to the PMC, said the coalition has been discussing both issues with officials from the Centers for Medicare and Medicaid and the Office of Management and Budget. "Providers who properly submit the [certificate of medical necessity] are told they are noncompliant because they didn't comply with a rule that was after the fact," he says. "What we are trying to do is protect the integrity of the program. Those that play by the rules shouldn't be penalized. We are asking that [CMS] make the rules consistent and fair and that they make sure our people abide by them." Azia says the coalition also has had "continual dialog" with government entities to encourage Medicare to drop its bias toward approving reimbursement only for equipment designed for home use. "As we create systems or equipment that are more technologically advanced--that allow people to do more things--we should encourage people, not discourage them," he said. Medicare, he added, should be looking at the big picture, and asking would providing more expensive equipment today reduce or eliminate the likelihood of more costly problems tomorrow? "The government looks at how much [equipment] costs, but in many ways, [costlier equipment] is a cost saver," Azia said. "If a doctor feels that a patient is better-served by having certain features, we'd be better-served and the financial costs of the program would be better-served by paying that cost." Until Medicare's stance changes, Larry Jackson, president of Lebanon, Tenn.-based Permobil, believes providers and manufacturers alike must work to ensure that each end-user gets the best chair to answer his or her medical needs and lifestyle desires. That sometimes means identifying other payer sources, such as organizations or Medicaid, Jackson says. "Fight this fight," he urged providers. "This is a fight for the client's rights. Use your conscience, use your ethics and put your clients in an appropriate product. And that's not necessarily ours. "It's not that we want the most expensive chair," he continues. "We want the best chair for the client. How much would you pay for somebody's legs?" HHCA Emerges from Bankruptcy KING OF PRUSSIA, Pa.--Home Health Corporation of America on January 8 announced it has emerged from bankruptcy, following the U.S. District Court for Delaware's acceptance of the company's reorganization plan. After almost three years of bankruptcy proceedings, "we emerge from bankruptcy a much stronger company, focused exclusively on adult and pediatric nursing," said David Geller, the company's chief executive officer. Under the reorganization plan, HHCA's secured lenders will receive 100 percent of the company's common stock, while unsecured lenders will receive $600,000, as well as potential claims recoveries. The company's common stockholders will receive nothing, despite the stockholders' efforts to block the plan. Since filing for Chapter 11 in February 1999, HHCA has sold its respiratory therapy and home medical equipment business to Costa Mesa, Calif.-based Apria Healthcare, and has reached a global settlement with the Centers for Medicare and Medicaid Services for alleged Medicare Part A violations.

PROVIDER NEWS Med Diversified to Acquire Addus HealthCare ANDOVER, Mass.-- Looking to expand its presence in the alternate-site care market, health care giant Med Diversified has signed a definitive agreement to acquire Addus HealthCare, a home health service and equipment provider located in Palatine, Ill. With this addition, Med Diversified expects to increase its annual revenue by $240 million, the company said. "The time has come to consolidate alternate-site care," said Andrew Wright, Addus' founder and chairman. "Our management team firmly believes in Med Diversified's vision." Med Diversified said it would publish the terms of the deal in the company's upcoming 8-K filing. Both companies expect to complete the merger sometime this month. Gentiva Opens Atlanta Location MELVILLE, N.Y.--To increase its presence in the Southeastern U.S. home health care market, Gentiva Health Services has opened a new location in Atlanta. The address for Gentiva's Atlanta location are: 1303 High Tower Tr., Suite 140, Atlanta, Ga. 30350. MANUFACTURER NEWS Lifescan Issues Urgent Product Notification NEW BRUNSWICK, N.J.--Johnson & Johnson subsidiary Lifescan, one of country's leading blood glucose meter manufacturers, has announced that the company's One Touch Profile Meters may develop display problems. "We have recently determined that One Touch Profile Meters exhibit a higher-than-expected number of display problems as they age," the company said. "While this may occur at any time, this tends to peak two-and-a-half years after the meter was manufactured." In light of this announcement, Lifescan has urged its customers to check One Touch's display before each blood glucose measurement. Patients should compare the display test--which appears as soon as the patient turns on the meter--to the properly functioning display test rendered at Lifescan's Web site. To spread this message, the company said it would send a notification letter to all registered One Touch Profile Meter owners. Additionally, the company said it would attach a notification to all of the One Touch blood glucose test strip packages, and would send a letter to pharmacists and health care professionals throughout the United States. For more information on this product announcement--or to see a properly functioning display test--visit http://www.lifescan.com/company/press/profile_letter.html, and scroll down to the second page.

SPOTLIGHT GAO Reports Problems with Medicare Debt Collection WASHINGTON--The Centers for Medicare and Medicaid Services' civil-fine collection procedures need improvement, according to a recent report from the U.S. General Accounting Office. During the past five years, increased fraud-and-abuse detection activities have swelled CMS' civil penalties collection accounts, the report said. However, before CMS can collect more than $255 million in civil penalties--connected to violations dating back to fiscal year 1997--the agency first must overcome internal accounting hurdles, GAO explained. Initially, GAO intended to focus on CMS' collection procedures for this report, but after finding discrepancies "in the tens of millions" between CMS' internal accounts-receivable records and the U.S. Health and Human Services Department's accounts-receivable records, GAO changed its focus. "The data reliability issue . . . limited us from determining the overall adequacy of the CMP [or civil penalties] debt collection policies and procedures," the report said. Consequently, the report instead focused on improving the agency's reconciling procedures. "We found that CMS does not have formal written policies and procedures for reconciling CMP receivables, recording CMP receivables in the general ledger and determining the allowance for 'uncollectable' accounts related to CMP receivables." To address these accounting problems, CMS should develop written procedures for reconciling its internal CMP records with HHS' general ledger, and for recording long-term-care receivables in the general ledger before collecting the penalties, the report said.

Additionally, the report suggested that CMS develop guidelines to govern how much the agency can negotiate when collecting outstanding civil penalties. GAO found that, for 89 out of 215 delinquent civil penalties accounts collected between 1999 and 2000, CMS negotiated settlements that were significantly below the 35-percent discount rate allowed by the agency's managers. While CMS agreed with most of the report's recommendations, the agency did not agree that further guidelines for negotiating civil penalty settlements are necessary. On the contrary, flexibility is important to the settlement process, CMS insisted, explaining that further guidelines would only add rigidity. Finally, GAO examined what roles, if any, the Office of Management and Budget and the Office of the Treasury play in overseeing CMS' civil-fine collection process. The report found that, while both OMB and the Treasury possess broad oversight authority, they rely on CMS to handle the details of civil penalty collection. CMS' Office of Inspector General should oversee the agency's debt collection procedures through audits, OMB said. The Treasury said that it relies on CMS to decide what debt should be referred to the Treasury for collection. However, the Treasury admitted, CMS currently is not referring all eligible civil debts. For more information on this report, visit http://www.gao.gov, and click on "GAO Reports." Then, click on "Reports and Testimony," and search for the reports published on Dec. 31, 2001.

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