Wheelchair users in the United States are finding out that getting the durable medical equipment they need — and getting it when they need it — is getting harder and costlier. Restrictive documentation policies as well as outdated “in-the-home” language that governs claims decisions in the Centers for Medicare and Medicaid Services are creating hassles for DME dealers and consumers. What’s worse, power wheelchair reimbursements made by Medicare — already reduced by 27 percent in January 2007, will be reduced by another 19 percent on July 1 due to Medicare’s national competitive bidding program. Since private insurance companies follow CMS’ lead, these new policies portend a growing nightmare of denials, delays, red tape, and economic hardship for DME dealers and end users alike.
When Abbie Freedman, of Santa Rosa, Calif., was paralyzed at 39 due to a T5 spinal cord injury, she was immediately covered by MediCal. A year and a half later, because MediCal does not allow beneficiaries to have anything more than subsistence funds in the bank, she was switched to Medicare. She used three wheelchairs in the next 22 years, and Medicare picked up the costs. Now in her early 60s, with deteriorating shoulders, Freedman was advised to have corrective surgery, but her personal physician, knowing how difficult recovery can be, advised against it. Instead, he prescribed specialized physical therapy and a new power-assist wheelchair.
Freedman ordered an iGLIDE, manufactured by Independence Technology, and was told by IT that Medicare would cover it. Anxious to get on with saving her shoulders, she paid for it out of her own pocket, then filed a claim for reimbursement with Medicare. She received the chair in September 2004 but was surprised when her claim for reimbursement was denied. “I’m not sure I would have ordered it had I known Medicare wouldn’t pay,” she says. “$6,320 is a lot of money.”
The Medicare denial stated: “This item cannot be paid without a new, revised, or renewed certificate of medical necessity.” Freedman then resubmitted a new CMN and her appeal was approved in March 2005, but no reimbursement was issued. Later she received a letter dated June 28, 2005 from a Medicare administrator in response to her appeal, stating, “If you paid any amount to this provider for this service, Medicare will pay you back the amount you paid. To get this payment, bring or send to this office three things: 1. A copy of this notice; 2. Your supplier’s bill; 3. A receipt or other proof you have paid the bill.”
“At that time, I submitted the three required documents,” says Freedman. “Since then, I have made several attempts to get this reimbursement from Medicare, both written and by phone, only to get a runaround, no response, or one that is irrelevant,” she says.
The latest runaround occurred in August 2007, when she was told by CMS that she would receive reimbursement from CMS’ contracted carrier — Noridian Administrative Services, of Fargo, N.D., but she would have to contact them directly. She did, and was told she had to fill out another form. “It was an original claim form! After nearly four years, they sent me back to square one. The system is a joke, but it’s not funny.”
In December 2007 Freedman received another letter from Medicare stating that her iGLIDE would not be covered. “I’m getting worn down. If it were less money, I would just give up. I can’t tell you how many phone calls and letters I have sent, and you never get the same person. But I’m not giving up. It’s not only the money, it’s the principle. They keep telling me I’m entitled to reimbursement, but it’s going on four years, and I haven’t seen a dime.”
Ultralight Titanium Chair: Document Need!
On May 15, 2007, Sue Montgomery met with her local durable medical equipment dealer and ordered a Quickie Ti ultralight as a replacement wheelchair. Six weeks later, Montgomery, of Knox, Pa., called and discovered that the person handling the order had accidentally misplaced the paperwork, so it was re-sent. On July 17, Montgomery learned that her insurance company had denied her claim: The wheelchair was deemed “not a medical necessity.”
Montgomery, who has severe bilateral osteoarthritis, had filed documentation of medical need by her orthopedic surgeon along with her need as an active lifestyle wheelchair user with a full-time job. Her medical records established that she had undergone 11 failed reconstructive surgeries and had used a wheelchair for 15 years. Understandably upset, she appealed the denial, which set in motion a series of appeals and denials — she appealed three times — until she finally received a letter of approval on October 9, followed by shipment of the wheelchair on November 14. But the wheelchair that arrived had no brakes, no cushion, no anti-tip bars, and was the wrong size seat depth. Montgomery refused the chair. A different chair arrived on December 7 but still had the wrong seat depth. Finally, on Jan. 4, 2008, the seat depth issue was resolved. The list price of Montgomery’s Quickie Ti was nearly $5,700, definitely on the high side.
In her research, Montgomery discovered that had she been covered by Medicare (or if her private insurer would have allowed it), she might have been able to sign an Advanced Beneficiary Notice giving her the option of paying the difference between what Medicare codes allow for a given type of wheelchair and the actual cost of the product. Under an ABN, she would have been allowed $2,986, and she would have paid $2,641 out of pocket. However, Montgomery’s private insurance did not allow an ABN [see www.wheelchairjunkie.com/abn.html for an article on ABNs]. Fortunately, since Montgomery won her appeal on the third try, she got a much better deal, paying only an out-of-pocket deductible of a few hundred dollars. Although the overall purchase price was high, her portion was minimal. Not all insurance companies would have covered as much.
“The most important thing I did in the final appeal was document my need for an ultra-lightweight chair. The insurance guidelines require a medical statement that I could not propel the standard or the lightweight, and that I required the ultra lightweight. I documented 29 years of stress on elbows, wrists, and shoulders from using crutches and wheelchairs. We also stressed the need to maintain my independence not only in my active lifestyle, but in my daily living skills in the home.”
All-Terrain Chair: Pushing Coverage Limits
Walter Reynolds, 57, injured at the T9 level in 1970, feels fortunate to be able to live on acreage in central California. He moved to the Santa Maria area in 1980 and not long after landed a good job, where he has been promoted over the years, enabling him to purchase property in a secluded canyon-like area. His lifestyle would be physically demanding for anyone, but for a wheelchair user, appropriate adaptive equipment is critical. He has a long gravel driveway to maintain, a well, a septic system and several outbuildings, and he tries to do as much as possible himself.
Problems with shoulder wear and tear from decades of wheeling resulted in rotator cuff surgery, so now he tries to preserve what he has. “There comes a point where you want to use a power chair to save your shoulders.” But not just any power chair works with his lifestyle. He needed a chair with all-terrain capabilities, so he ordered an OmegaTrac by Teftec.
His admittedly hopeful plan was that his insurance company, Blue Cross, which up to that point had provided excellent service, would be able to see his unique need. To make certain they understood, he engaged an occupational therapist to do an exhaustive, 20-page summary/analysis of his ADLs and rural lifestyle. Nice try, but didn’t work.
“They should be deciding these cases on a case-by-case basis, but they were unwilling to negotiate,” he says. He feels that Medicare policy, specifically the outdated “in-the-home” restriction, is responsible for his insurance company’s denial. “Insurance companies are falling back on Medicare policy and using the “in-the-home” language to their benefit in order to deny equipment and save money.”
What galls Reynolds most is that in rehab he was taught to do as much as he can possibly do, and now his insurance company, following CMS’ lead, is doing its best to restrict his lifestyle choices.
What About Top-of-the-Line Standers?
While lifestyle restrictions imposed by insurance companies may be understandable to some, how can restrictions placed on our health needs be justifiable? James Parsons, 27, a T6 para for five years, took time off from his job in Portland, Ore., to travel to Detroit for a three-week intensive rehab program at the Rehab Institute of Michigan last year [see "Stem Cell Gamble," March 2008]. He wanted to maximize the potential of his core muscles and stay in shape for future breakthroughs in SCI restorative therapies.
His father, Roger, had met with Dr. Wise Young in China while researching olfactory ensheathing cells treatment options, and Young had told him the best piece of equipment that James could buy would be a stander, to keep his bones strong, among other health benefits. James ordered an EZ Stand Evolv Glider because it combined exercise with standing and stretching, fully expecting that his insurance company, United Health Care, would see the health benefits and cover the cost. They even knew of someone else who had succeeded in getting UHC to cover this model.
But UHC denied Parson’s initial claim, which set in motion a campaign of letter writing between a very determined father and son and an extremely unresponsive insurance company. The Parsons have been careful to document everything in their seemingly endless appeals process, beginning with an internal appeal, which was denied, and moving on to a second internal appeal, also denied, and, finally, an external appeal, just denied in April. During this process the Parsons have sent untold numbers of letters and have provided documentation of the benefits of the stander for James’ particular condition based on applicable clinical trials, but UHC, playing the role of institutional ostrich with head-in-sand, stubbornly refuses to acknowledge those benefits.
The irony of all this is that UHC paid for James’ intensive three-week therapy at RIM, where he used the exact same model of stander and where he obtained letters of support from physical therapists who worked with him. Still, UHC would not approve the same stander for use in his home.
Not only does the insurance company’s position not make logical sense, it does not make monetary sense. UHC was willing to pay $5,000 or more for three weeks at RIM, but they refuse to pay for a stander/exerciser that Parsons would be able to make effective use of for years. And what are the benefits of this particular model of stander? Strong bones, enhanced circulation, improved urinary tract and bowel function, less chance of pressure sores, even some cardiovascular benefit.
Apparently, even though the principle of preventive medical care is universally praised, cost-effective treatment is not high on the list of some insurance companies. The Parsons fully intend to seek help from their state legislators.
Expect Human Error and Delays
As unresponsive as Medicare and insurance companies are, there are other potential flies in the ointment. Janet Nordgren, 34, feels that most of her problems with getting a new TiLite wheelchair can be traced to an equipment dealer that was less than competent. To be fair, part of the blame is Nordgren’s, and part is due to the nightmare of paperwork that dealers face in getting the right equipment in the first place.
Nordgren’s history of wheelchair purchases is a lesson in itself. When she sustained an SCI at the T12 level at the age of 22, her first chair was a Quickie, which served her well, but she opted for a TiLite replacement several years later. Although she lives in Massachusetts, a physical therapist at Craig Hospital in Denver helped with ordering her chair, and to date, this is the best experience Nordgren has had in purchasing equipment. “They were awesome, they knew exactly what to do.”
When it came time to replace the TiLite, she called someone she knew at TiLite who helped her fill out all the measurements and specifics over the phone. When her chair arrived, she realized she had made a mistake in ordering. The chair wasn’t right for her. So this time she went to her local DME dealer to re-order. Oddly, the same thing happened again. On the third try, the order went through without problems, but the protracted three-part process, mired in paperwork and delays, took 1.5 years to run its course. And she ended up having to pay significantly more than the insurance company allowed.
“I’m very fortunate that I have a good job and can afford to get what I need,” she says. “I can’t even imagine what it is like to have to deal with all this without the right support or enough money to get the right equipment. Maybe it was just this particular situation, but the people I dealt with [at the local level] did not know what they were doing, and this always complicated the process.”
Getting the chair you need is more complicated than ever today. Medicare and insurance companies are re-structuring the process and narrowing windows of approval. Longer delays are the norm. DME dealers are squeezed by lower reimbursement allowables and more complex and time-consuming documentation. Buyer be vigilant! Buyer beware!
At What Cost, Savings?
By Josie Byzek
Kathy Hertzog of Erie, Pa., has spent years fighting her state’s efforts to impose a competitive bidding program on all Medicaid beneficiaries who use durable medical equipment. When explaining to policy makers why such a program is a horrible idea, Hertzog, 44, tells them what happened when she needed to rent a wheelchair.
“When I was in a car accident in 2005, I needed a manual wheelchair because mine was totaled,” says Hertzog, who was born with a C3-4 incomplete spinal cord injury. She generally uses a power wheelchair, but prefers a manual when she travels, so she can then access more vehicles. “I called every supplier in town to rent a manual wheelchair while I was fitted and waiting for a new manual wheelchair. I was willing to pay cold, hard cash, but nobody even returned my calls. Finally, I remembered the son of the man who used to repair my chair had gone into business for himself. I called him and said, ‘Look, you’ve got to help me, I’m desperate. Just give me something to hold me over,’ and he did.”
What’s this have to do with competitive bidding? Advocates like Hertzog figure that since there will be significantly less vendors to choose from under competitive bidding, the odds against finding that one guy who will actually help will increase exponentially.
“I do not want to spend the rest of my life dealing with crap like this,” says Hertzog. “I have enough to worry about, plan for, prepare for and cope with without having to add competitive bidding to my list of things I need to handle.”
For now, Hertzog and other Pennsylvania advocates have convinced the state’s Department of Public Welfare that competitive bidding programs are a bad idea. Besides making it harder for customers to find a receptive vendor for unusual situations like Hertzog’s totaled chair, advocates also point out it’s a horrible idea to close down small businesses at a time when our nation’s economy is struggling.
But despite the advocates’ best efforts, competitive bidding has come to Pennsylvania anyway — and many other states as well — as the federal government’s Centers for Medicare and Medicaid Services has launched the first round of a program geared toward phasing competitive bidding in nationwide. The Pittsburgh area, just south of Hertzog, is one of 10 metro areas where Medicare beneficiaries will very soon have a shrunken pool of vendors to pick from. The other nine metro areas are Charlotte, N.C.; Cincinatti, Ohio; Cleveland, Ohio; Dallas-Fort Worth, Texas; Kansas City, Mo.; Miami, Fla.; Orlando, Fla.; Riverside, Calif.; and San Juan, Puerto Rico. CMS plans to roll out the program in another 70 cities next year, and then eventually the program will be nationwide.
Winners and Not Winners
Generally, CMS competitive bidding works like this: DME is divided up into categories, and vendors are allowed to bid on a certain number of those. Manual wheelchairs are in one category, oxygen in another. Complex rehab — the name for types of equipment like high-end power wheelchairs for people with disabilities such as quadriplegia — has its own category, but is included in competitive bidding. The DME industry and advocates alike hoped complex rehab would be carved out of competitive bidding, but weren’t able to make that happen.
CMS took all the prices it could find for specific DME, added them together and found the average, called the median, and picked bidders based on this median. In addition, CMS added on layers of accreditation, in hopes of linking quality to savings. For example, all vendors who won a bid must now have an accredited assistive technology supplier or provider on staff.
About 40 percent of a DME vendor’s business is with Medicare beneficiaries, and so the industry fears many suppliers whose bids are not chosen will close up shop. The Impact of Competitive Bidding on the Market for DME, an industry-sponsored study by the Robert Morris University, predicts over 21,000 people will lose their jobs once competitive bidding is unrolled nationwide.
CMS admits these fears are well-grounded.
“Here’s what’s going to happen,” says Laurence Wilson, director of chronic care policy for CMS. “Competitive bidding is a requirement of the Medicare Modernization Act of 2003, and what the law requires is that we have competition between bidders to see who provides the best value, and we select winners. The others are not winners and they don’t get to provide those services. A lot of companies will not be winners and will not be able to provide these products to Medicare.”
But, says Wilson, competitive bidding isn’t just something CMS is doing because the law says it must. Wilson and other high-ranking CMS policy makers believe it’s a good program update that will save both taxpayers and beneficiaries a lot of money. Wilson, like many in CMS, has been with the agency for over 20 years, so it would be a mistake to think he or his staff are somehow responding to the political ideologies of either the far-right or left. These top-notch analysts believe competitive bidding is a good thing.
“Competitive bidding is in response to a few issues, like the need for more accurate pricing for products in the marketplace,” says Wilson. “Right now we use a fee schedule that’s been in place for 23 years. It’s been updated from time to time, but the base prices are 23 years old and don’t reflect today’s prices. So this is a way to allow the market to set the prices, and for us to contract with those who provide the best services and products, so the beneficiaries ultimately get the best value.” Wilson points out the program will mean lower prices for most DME, and that means a lower co-pay for beneficiaries. Also, with CMS having tighter control on who gets Medicare monies, competitive bidding is expected to cut down on fraud.
But no matter how many quality assurances are built in, says John Shirvinsky, executive director of the Pennsylvania Association of Medical Suppliers, competitive bidding is destined to fail, because it’s trying to fix a system that isn’t broken. To prove his point, Shirvinsky cites the Robert Morris study.
“When Robert Morris first got our request, researchers Brian O’Roark and Stephen Foreman said this study will be easy, it’s about competing, and competing’s good for business. But after studying CMS’ program, they came to the same conclusion we did — this is not a program designed to create competition, but to eliminate competition from the market,” says Shirvinsky. “Right now if you supply DME, you’re not competing on price, but on quality of service. This is a consumer-driven competition. The company that does the best job of meeting your needs gets your business. And this will all be destroyed with competitive bidding.”
CMS discounts the Robert Morris study because it was industry-funded and doesn’t take into account the program’s final rule.
New DME Vocab Word: Oligopoly
Georgie Blackburn’s medical supply company won five CMS bids for the seven-county Pittsburgh region, including both standard and complex power wheelchairs. But she still thinks competitive bidding is a bad idea. “Our goal has never been to be a monopoly in this business,” says Blackburn, vice president of government relations and legislative affairs at Blackburn’s. Blackburn is also secretary of the American Association for Homecare. “We want to handle our customers in an efficient and satisfactory manner, but this program ensures increased pressure, increased need and dilutes the allowable [Medicare will pay less for products]. It’s not a good formula for success.”
Blackburn and others in the industry think the shrinking pool of vendors will lead to an oligopoly, or a few mega-providers running the show. And even though her own business is poised to be one of those calling the shots, she shudders at what this will do to her customer base.
“Our services keep people out of hospitals and institutions. If they don’t get services quick enough, then payments for Medicare Part A will actually increase, as people will have to go to the emergency room and be admitted to hospitals,” says Blackburn. Medicare Part A is often used to pay for types of inpatient care.
Also, if the decreased supply of vendors can’t keep pace with the increased demand for services (all the folks who used to use other providers), more people will be stuck with ill-fitting or broken equipment for longer periods of time, which will lead to problems like decubiti. “You simply cannot put this many providers out of business and say the quality of care will be enhanced,” says Blackburn.
But the complaint that chairs will be left unrepaired for long periods of time is a bit of a red herring, suggests Wilson. “We have enough suppliers and have done a few other things. Also, any supplier can provide and bill Medicare for repairs, whether they’re a winner or not. The beneficiary doesn’t have to go to a specific supplier to get the wheelchair repaired — so that playing field remains unchanged.”
It probably won’t work the way CMS intends, says Kevin Huwe, assistive technology program manager with the Center for Independent Living of Southwestern Pennsylvania. “Usually if a vendor didn’t provide the chair, they’re not going to touch it when it breaks down, so there will be problems with repairs. But the biggest thing to me is the whole ‘consumer choice’ aspect. If I hate a vendor because they don’t return my calls, lie to me, or don’t come out when my chair breaks down, I want the ability to go with a different vendor. And that whole thing is taken away.”
It’s About Fraud … Only It Isn’t
Wilson says CMS’ competitive bidding program isn’t a result of Medicare fraud — it’s a requirement of the Medicare Modernization Act of 2003. But the fact that the bidding program should cut down on the problem of fraud is certainly a selling point. “Fraud and abuse are very substantial problems in this area,” says Wilson, talking about DME used in people’s homes. “It’s not like these transactions are done in institutions that are more in the public eye. With competitive bidding we can assure we’ll have good sound business partners — legitimate businesses with accurate prices.”
And some of these fraud cases are outrageous. In Houston, the owner of Rosewood Medical Supplies, Enohor Akarue, bilked the government out of over $600,000. “This defendant is charged with defrauding Medicaid and Medicare by billing taxpayers for wheelchairs that were never delivered,” says Greg Abbott, Texas attorney general and a wheelchair user himself ["Attorney General Greg Abbott: Taking the Reins in Texas Territory," November 2007]. In Arizona, Kieran Chikwendu got people from California to sign up for wheelchairs they didn’t even need, and netted $263,000. In Denver, Daniel Arnold, owner of D&D Medical, padded his bills and swindled over $1 million, hardly chump change.
“We take great umbrage at the whole focus on fraud,” says Shirvinsky. “There are two types of fraud in this business, and both problems lead right back to CMS’ doorstep.”
First you have the scam artists, “the really down low and dirty guys who come in and set up shell companies. And what drives me crazy … well, take the sensational case of the 30 or 40 that were caught in the Miami area in a boarded-up strip mall,” says Shirvinsky. “In order to bill Medicare you have to have a provider ID number, and you’re not supposed to get one without the National Supplier Clearinghouse showing up and verifying you’re a legitimate organization. How did CMS manage to give 30 to 40 ID numbers to a single address where there was obviously nothing going on?”
The second type of fraud is harder to follow, as it’s more subtle and usually not fraud at all. “The orders we have to submit to CMS contain complex physician orders and medical records, especially for mobility and complex rehab equipment. And when these orders go to audit, CMS often calls for a payment reversal for us due to inadequate physician orders or documentation. We’re the middleman, you know? And what makes this even worse is there’s no guidance from CMS to physicians who are filling out these orders.”
Shirvinsky says it’s common for a dealer to get a customer a $30,000 wheelchair, only to be told later by CMS to pay the $30,000 back, because the doctor screwed up the paperwork. The customer keeps the chair, but the dealer doesn’t keep the money.
Also, how big an issue can fraud be, when so few people actually use DME? According to PAMS, only 1.3 percent of U.S. health care spending in 2005 was for DME.
Competitive Bidding: Inevitable?
CMS says it understands that sweeping changes like those called for in competitive bidding are frightening, but the doomsday predictions are a bit overboard. “We tried to select enough suppliers to meet access concerns, and we’ve established the process so that when businesses compete, they will have to compete on quality. I think for this reason, many of these suppliers will continue to supply the same products they’ve been supplying,” says Wilson. “All providers have to give CMS info on brands they provide so that people can see where they want to go to get the type of products they want.”
Besides, says Wilson, even if someone does have to get a slightly different product, like a wheelchair, for less money, that’s not so bad. “All equipment is approved by the FDA, and all the items covered are manufactured to FDA requirements. If you want to be a winner, you have to come up with a competitive price. Some are saying in order to do this, they’ll have to provide low quality. We’re not saying that.”
But how can providers not cut quality along with costs, wonders Cara Bachenheimer, senior vice president of government relations for Invacare. “With competitive bidding there’s just a huge payment reduction. You’ve got new payment levels that are in many instances below the acquisition costs for the equipment. So we’ve got serious concerns about the type of equipment that will be provided, the services that will be provided, and obviously the impact on the consumer here.”
Plus, the industry feels shut out of the process. “We’re trying to scramble, to figure out how to deal with this … CMS isn’t being transparent. We’re in the dark. They’re doing this step-by-step, but they’re not including us in the ride,” says Darren Jernigan, director of governmental affairs for Permobil, and a quad himself.
So there’s no way to stop competitive bidding? “To be honest the only way there’s going to be some change is to have some outcry from consumers,” says Jernigan. “But it’s just so difficult to mobilize the disability community. They’re the poorest and least educated class in America. It’s like the government’s a drug dealer and says, ‘here’s your check, you get it once a month, we’ll try to take care of you, just don’t try to get off the system. And having the government trying to take care of something … they use a hammer to squash a fly for everything.”
Advocates in Pittsburgh recognize they need to deal with competitive bidding, but they don’t have to like it. “We’ll find out three to five years from now if we can live with this,” says Huwe. “But why should people who’ve used the same vendor for years be forced to change? You have vendors who’ve helped children get chairs, grown with them into adulthood, know how their bodies fit, and now complete strangers will come in. Those relationships will be broken. I don’t see how this is going to be a good thing.”