Hirono sponsors bipartisan medical equipment bill

Lawmakers in Congress have introduced a bill aimed at easing the effects of Medicare reimbursement cuts on Neighbor Island and other nonurban communities in the United States.

Hawaii Sen. Mazie Hirono co-sponsored the bipartisan Patient Access to Durable Medical Equipment Act with 14 other senators. The bill, introduced in the Senate on Thursday and referred to the Committee of Finance, would delay the reimbursement cuts, which are slated to go into effect this year, until 2017.

Hirono said that Hawaii residents have approached her in the past with concerns about access to medical equipment under the new reimbursement system.

"This measure makes necessary changes to the reimbursement system and takes into account different factors that rural providers

face to allow Medicare beneficiaries uninterrupted access to durable medical equipment," Hirono said in a news release Monday.

When suppliers purchase durable medical equipment and sell it to Medicare patients, they are reimbursed by Medicare or the patient's health insurance company. Medicare had been reducing these reimbursement rates in metropolitan areas around the country, and now plans to do the same for suppliers in nonurban and rural areas that include the Neighbor Islands. The cuts were being implemented in two phases. For example, oxygen therapy product reimbursements will be cut by a total of 40 percent in 2016 - 20 percent in January and another 20 percent in July.

However, this new bill would extend the date for the second phase of cuts from July 1 to Sept. 30, 2017.

Co-sponsor Sen. Heidi Heitkamp, D-N.D., who like Hirono represents a state with numerous nonurban communities, said that this "would enable a smoother transition for this program."

"For seniors throughout the country, including in rural areas like North Dakota and Hawaii, access to critical medical equipment like hospital beds, walkers and oxygen supplies shouldn't be a question," Heitkamp said.

Extending the phase-in date would also allow Congress "to properly monitor the rollout of this program in real time," according to a news release from Hirono's office.

The bill also would adjust Medicare's competitive bidding process, which started in 2013 and has been called a "flawed" auctioning system by suppliers and economists. The process allowed suppliers in designated metropolitan areas to bid to service certain products. Medicare set reimbursement rates at the median of these bids and required patients to go to a winning bidder.

"Seniors on Oahu have struggled with receiving needed medical equipment since Medicare rolled out one-size-fits-all cuts in 2013," said George Greene, president and chief executive officer of the Healthcare Association of Hawaii. "Local suppliers were largely shut out of this program and our members found it increasingly difficult to get their patients the items they needed."

Medicare bases its bid ceilings, or the maximum limit for these reimbursement rates, on the previous year, which are set to decrease each year. However, this bill would keep the bid ceiling at 2015 rates - adjusted annually for inflation - to allow for more generous reimbursements.

The bill also mandates that, when determining rates for Jan. 1, 2019, and beyond, Medicare would have to seek stakeholder input as well as to consider the challenges of nonurban areas, including average travel distance, delivery time, the number of suppliers in the area and the average equipment volume of these suppliers. It also requires a monthly report on Medicare beneficiaries' access to equipment throughout the new extended phase-in period.

"The initial reductions that began in January are causing hardship to residents in the neighboring islands, who already pay higher costs to secure what they need because of additional distance and shipping costs," Greene said. "Hawaii's seniors - most of whom are on fixed incomes - should not have to have their access to needed medical equipment in jeopardy."

Medicare has said in the past that officials do not comment on ongoing legislation, but that they will of course follow it if it becomes law.