Attention Patients:

Please read, print and keep for future reference.

Frequently Asked Questions (FAQs)

About Medicare Changes to Coverage, Services and Payment for Home Medical Equipment

January 2007

When Congress passed The Deficit Reduction Act of 2005 (“the DRA”), it made a number of changes to the way that the Medicare program covers and pays for certain home medical equipment (HME) and home oxygen therapy. Some of the changes take place in 2007, while others occur in later years. We recommend that you read this information carefully so that you understand how these changes impact you. Keep it as a reference if you have questions about your Medicare Part B-covered HME.

What is the Deficit Reduction Act (DRA) of 2005?

The Deficit Reduction Act, or DRA, is a new law passed by Congress and signed into law by President George W. Bush in March of 2006. The law contains many different sections, but one goal is to reduce the amount of money the government spends on certain Medicare and Medicaid products and services, in an effort to help reduce the United States deficit.

Under the DRA, homecare providers will receive less reimbursement for certain home medical equipment products, and ownership of those items will pass to you automatically after 13 months of continuous rental. You will then be responsible for coordinating any repairs the equipment might need and performing routine maintenance on the equipment you own.

In 2007, the changes relate mostly to traditional home medical equipment. Other changes will impact home oxygen therapy and equipment some time after 2007. This FAQ focuses on HME and you will be provided with updated information about oxygen at a later date.

Purpose of the FAQs

The purpose of this list of frequently asked questions (FAQs) is to provide patients and caregivers with information that will help explain the new law and what it means to Medicare beneficiaries who rely on home medical equipment products and services covered by Medicare Part B.

Home Medical Equipment includes, but is not limited to, medical and respiratory equipment such as continuous positive airway pressure (CPAP) devices, nebulizers, patient lifts, infusion pumps, wheelchairs and hospital beds.

CHANGES TO HOME MEDICAL EQUIPMENT (HME) COVERAGE AND PAYMENT

Which Medicare Part B products and/or services are targeted by the DRA?

The DRA made changes to two categories of Part B products and services:

1. Home Medical Equipment subject to “capped rental” by Medicare, and,

2. Home oxygen therapy and equipment

What does “capped rental” mean?

“Capped rental” means that Medicare pays a monthly rental payment to homecare providers up to a certain number of months of continuous use while the equipment or service is still needed by the patient. The maximum number of months is called the “capped” level.

What does “continuous use” mean?

“Continuous use” means using the medical equipment month after month after month rather than only for a short time.

How does the DRA change the capped rental period for home medical equipment (HME)?

Prior to the DRA, for capped rental HME products, Medicare reimbursed providers for up to 15 months of continuous use. Medicare also reimbursed providers for a maintenance and service fee for every six months the patient was still using the equipment after the 15 th month and gave the patient the option to purchase in the 10 th month. The provider still owned the equipment even after the 15 th month.

Under the DRA, Medicare will reimburse providers for up to 13 months of continuous use and the title to the equipment will then automatically pass to the patient. This means that you will own the equipment after the 13 th month of continuous use.

The January 1, 2006 effective date means that the law applies to patients who first received the equipment on or after January 1, 2006 .

There will no longer be a maintenance and service fee paid to providers every six months for the capped rental HME. Both Congress and Medicare expect you or a caregiver to perform routine maintenance on the equipment you own.

What specific products and services are included?

The products affected by the DRA are:

Alternating Pressure Pads & Pumps (APPs ), Air Pressure Mattress es , Water Mattress es , Paraffin Bath s , Hospital Beds, Continuous Positive Airway Pressure (CPAP) devices, Respiratory Assist Device s (e.g. BiPAP or BiPAP ST) , Percussor s , Nebulizer s , Suction Pump s , Patient Lift s , Externa l Infusion Pump s , Trapeze Bar s , Commode Chairs (only those with special features such as drop arms or wheels), and W heelchair s .

Technically, Medicare considers this to be an equipment-only benefit with only a limited number of services recognized by the program. For example, the Medicare benefit does not really recognize all of the in-home delivery services and patient support services we provide to you and all of our patients “behind the scenes.”

How do I know if I have one of the products or services in my home?

Since the homecare provider must bill the Medicare program for every month that you are still using the equipment during the rental period, you can look at a recent Medicare billing statement or invoice for the co-pay to see the description of the item(s) you received from your homecare provider. Compare the item listed to the ones on the above list. If you are not sure, please contact us.

What is Medicare’s policy about HME items that I received before January 1, 2006?

Items on the above list, if first provided to you prior to January 1, 2006, will not be affected by the DRA. Medicare decided to “grandfather” those products and only apply the new law’s rules to any item whose first date of service was January 1, 2006 or any time afterward. By “grandfather,” we mean that Medicare will follow the old rules and regulations. Under the old rules, Medicare will continue to pay on a rental basis unless you decide to purchase the item . (Note: This discussion does not apply to home oxygen therapy and equipment. Separate, new rules apply.) A letter will be sent to you a sking if you want to rent or purchase the equipment. Again, this is only if your HME item was delivered before January 1, 2006.

What if I have multiple HME products in my home? Which rules apply?

We know this may be confusing because if you have more than one item that is called “capped rental,” and you received one or more of those items before January 1, 2006 and one or more items after January 1, 2006 , they will be subject to different Medicare rules and regulations.

For items whose first date of service or rental was prior to January 1, 2006 , the old rules apply. For items whose first date of service or rental was after January 1, 2006 , the new rules apply.

What happens if I stop using the medical equipment and then need the same equipment at a later date?

This is called a “break in service.” There are two possible ways for this to be viewed by Medicare:

1) If the break in service is for less than 60 days, the Medicare “rental counter” does not start over and begins where it left off before the equipment was returned.

Example

A patient’s physician prescribes a nebulizer and the Medicare rental period starts in January. The patient uses it for two months and returns it to the homecare provider in March because it is no longer needed. On April 15, the patient’s physician writes another prescription for a nebulizer and the patient starts using it that day. Because the break in service has been less than 60 days, Medicare counts the month of April as rental month four, May as month five, etc., up to the maximum of 13 months of continuous use.

2) If the break in service i f s for more than 60 days and the equipment was picked up due to the patient no longer needing it, the Medicare “rental counter” will start over at month one if medical necessity is established by a licensed physician.

Example

A patient’s physician prescribes a CPAP and the Medicare rental period starts in January. The patient uses it for two months and returns it to the homecare provider in March because he doesn’t like it. In July, the patient’s physician writes another prescription for a CPAP because the patient’s obstructive sleep apnea has become worse. Because this resulted in a break in need greater than 60 days (the patient’s condition changed), Medicare counts July as rental month one, August as month two, etc., up to the maximum of 13 months of continuous use.

What happens if I obtain certain medical equipment from one homecare provider, stop using it and, when I need it again later, I want to switch to a different homecare provider?

Because Medicare will pay for only one 13-month rental period and because certain home medical equipment is very expensive and requires a lot of service both to the patient and behind the scenes, every homecare provider will have a different policy on whether to accept new patients on service or whether to recommend that the patient return to the original homecare provider to obtain the medical equipment again.

What was the “maintenance and service fee” for capped rental HME, and how did the DRA change it?

The maintenance and service fee was not very expensive, but it covered services that patients might need from providers after the capped rental period. These services included 24-hour, seven-day-a-week on-call services, emergency equipment replacement or repair and removal of the equipment from the home after it was no longer needed.

Since the DRA eliminated the service maintenance and maintenance service fee, some of the services mentioned above will not be provided after the patient becomes the owner of the equipment. Instead, the patient and his/her family or caregiver has to take care of some of these services – this is what Congress intended when it wrote the law.

How does the DRA change the ownership of the equipment itself, and what does that mean to patients and their caregivers?

For items delivered prior to January 1, 2006, the homecare company will continue to provide as-needed service, repair, equipment exchange and maintenance services on a 24/7 basis since it continues to own the equipment and is therefore responsible for it. Providers will pick up the equipment when you no longer need it.

Now, under the DRA, after 13 months of continuous use of those items delivered on or after January 1, 2006 , you are required to take ownership of the equipment automatically. Patients no longer have a choice of renting or owning the equipment because the new law requires that ownership be transferred to you. When you own the equipment (as compared to when the provider owned the equipment), you are responsible for routine maintenance and identifying when other repairs are needed. You or your family must also dispose of the equipment in a safe and responsible manner after it is no longer needed.

REPAIR & MAINTENANCE QUESTIONS

What if my equipment has a problem before the 13 months is up?

Current Medicare rules require that homecare providers repair or replace equipment if it is still in the rental period. So, if you have a problem with your equipment before the 13 th month, call us.

What should I do if my equipment has a problem after the 13th month?

The new Medicare rules do not require homecare providers to repair equipment which Medicare beneficiaries own. Call us if you have a specific question.

BILLING QUESTIONS

How does the billing work under the new rule?

The homecare provider will continue to bill Medicare on your behalf if it is able to obtain all supporting medical documentation and you sign your “assignment of benefits” form which allows the provider to collect from Medicare on your behalf.

Will my Medicare Part B deductible amount change because of the DRA?

No. However, as in the past, i f Medicare applies your deductible to the homecare provider’s payment, we will bill you for that portion of your Medicare deductible .

Will I still owe the 20% co-pay amount after the 13 th month?

You will owe any outstanding co-pay amounts that are due for the services and equipment provided during the first 13 months. (If you have a supplemental Medicare insurance policy, that insurer will likely pay the 20% portion for these months.).

After the 13 th month, there will be no co-pay amount unless, for example, a repair is performed and billed to the Medicare program. (Different rules may apply to other equipment in your home, such as oxygen and any item not included in the capped rental category.)

PATIENT CARE QUESTIONS AND ANSWERS

After I own my equipment, what if my clinical needs change and I need a different model or device that has different features?  

Medicare ’s policy is that it will only pay for one device for you every five years. Unfortunately, if your needs change after you own the first device, Medicare will not pay for another device until the end of that five-year period . So, if you need something different, or a device with simply different features, you may need to pay for it out-of-pocket. There might be exceptions to this rule if there is a substantial change in your medical condition.

QUESTIONS ABOUT SUPPLIES

How do I get additional supplies for my department equipment ?

Medicare pays separately for most supplies used with your medical equipment. For example, you might have a CPAP machine or a nebulizer compressor that requires supplies such as CPAP masks, tubing or a nebulizer cup in order to be used properly over time . If so, please contact your local Apria Healthcare branch to order supplies. In many cases, Medicare will only approve a certain number of supplies per month. So, you may only be eligible to receive that number. Please contact us for more information and to order supplies.

HOW TO CONTACT MEDICARE OR CONGRESS

WITH POLICY CONCERNS

I don’t like these new rules at all. Who can I call or write to tell them about my concerns?

If you have any questions about Medicare’s policy changes, please contact 1-800-MEDICARE. If you would like to express your concerns about the new transfer of ownership or other policies directed by the DRA , you can also write to or call your local U.S. Representative or Senator through the U.S. Capitol switchboard at (202) 224-3121. To find the name of your Representative and Senator, you can look in the front of your local Yellow Pages phone book.