From the Medicare Modernization Update Home Page, 09/13/2005: Section 302-Conditions for Payment of Power Mobility Devices, Including Power Wheelchairs and Power-Operated Vehicles
CMS hosted an Open Door Forum that provided an overview of the current Interim Final Rule (published August 26, 2005 in the Federal Register) and more information on the coordination of this rule with the National Coverage Decision for Mobility Assistive Equipment (implemented July 5, 2005). Sec. 302 Payment for Durable Medical Equipment; Competitive Acquisition of Certain Items and Services
Current law:
The Balanced Budget Act of 1997 gave CMS the authority to conduct competitive bidding demonstrations for Medicare Part B items and services, excluding physician services. This authority expired on December 31, 2002.
The competitive bidding demonstrations have been successful in reducing costs for the Medicare program. Bidding demonstrations were implemented in Polk County, Florida, and San Antonio, Texas. Savings differed by demonstration site, but averaged 20% in the latest bids at both sites, resulting in savings for both the program and eligible individuals. CMS maintained high quality of products and services throughout the demonstrations and protected beneficiary access to durable medical equipment, prosthetics, orthotics, and supplies (DMEPOS) items and services within the selected demonstration sites.
Currently, DMEPOS items and services are paid according to the DMEPOS 2003 fee schedule.
Provision:
This provision establishes a competitive bidding process for durable medical equipment (DME), enteral nutrition, and off-the-shelf orthotics (those requiring minimal adjustment) as a nationwide permanent part of Medicare by phasing-in the program as follows: in 10 of the largest metropolitan statistical areas in 2007; 80 of the largest metropolitan statistical areas in 2009; and additional areas after 2009. In areas where competitive acquisition is not conducted after 2009, the Secretary may either apply competitive bidding payment amounts (from areas where competitive bidding is conducted) or may set payment amounts through inherent reasonableness (IR) authority. Class III devices, as defined in the Food, Drug, and Cosmetic Act, that are categorized as DME, would be exempt from this provision. Inhalation drugs are not included under this provision.
Clinical laboratory tests are included as a demonstration project but only for tests furnished without a face-to-face encounter between the patient and the entity furnishing the test (i.e., reference labs). The Secretary must submit an initial report to Congress on the demonstration project by December 31, 2005 and progress and final reports to Congress as appropriate. There is no initial start date for the demonstration.
Establishes a freeze on payments for all durable medical equipment (DME), excluding Class III devices, from 2004 to 2008; however the freeze may end prior to 2008 as the freeze shall not apply in competitive acquisition areas after competitive bidding has been implemented in those areas. Payments for prosthetic devices, prosthetics, and orthotics are frozen from 2004 to 2006. GAO is required to report by March 1, 2006, (and the Secretary is required to take GAO’s recommendations into account) on the appropriate payment update for Class III devices for 2007 and 2008.
For 2005 and subsequent years, or until competitive bidding is implemented for each of these items, the Secretary will establish a payment amount for oxygen, oxygen equipment, standard…
The summary nature of this document does not lend itself to a full explanation of all of these changes. There may be nuances and exceptions contained in the statutes that are not discussed in this summary. Moreover, this general summary is not a legal document and is not intended to grant rights, impose obligations, create interpretive rules, or establish general statements of policy. While we have made significant efforts to verify the accuracy of this publication, we refer readers to the United States Public Law for a full and accurate statement of its contents.
…wheelchairs including standard power wheelchairs, nebulizers, diabetic supplies including lancets and test strips, hospital beds, and air mattresses by applying an update factor that is based on findings of the OIG on differences between Medicare and FEHP regarding payments.
This section also requires the Secretary to establish and implement quality standards that independent accreditation organizations will apply to certain DME; prosthetic devices; orthotics; prosthetics; parenteral and enteral nutrients, equipment and supplies; medical supplies, home dialysis supplies and equipment; therapeutic shoes; electromyogram devices; salivation devices; blood products; and transfusion medicine, as the Secretary deems appropriate. Quality standards shall include consumer service standards.
This section requires that an eligible individual receive a face-to-face examination and a written prescription from a physician or certain practitioners other than a physician before Medicare pays for a power wheelchair. In addition, this section requires the Secretary to establish standards for clinical conditions for payment for all DME. The standards shall specify the types of equipment that require a face-to-face examination as a condition for payment. In addition, the Secretary is directed to first establish standards for those DME items for which the Secretary determines there has been a proliferation of use, consistent findings of charges for covered items that are not delivered, or consistent findings of falsification of documentation for payment.
Effective Date:
Upon enactment.