On September 10, the National Association for the Advancement of Orthotics and Prosthetics (NAAOP) released a statement regarding its current efforts to promote O&P’s agenda in national healthcare-reform legislation. That statement appears in edited form below:
Senator [Max] Baucus (D-MT) unveiled his long-awaited national healthcare reform plan on Wednesday, September 16, joining the fray of contentious healthcare-reform discussions. The Baucus bill ultimately was unable to attract the support of three key Republicans that Chairman Baucus has been negotiating with for the past several months, making his bill a partisan product….. However, Chairman Baucus kept open the possibility of compromise with Republican members as the bill is marked up in committee and brought to the Senate floor in the coming weeks.
O&P Fee Schedule
The Baucus legislation, as it stands, is a mixed bag for the field of orthotics and prosthetics but ultimately omits several major provisions that could have negatively impacted O&P reimbursement. Most healthcare providers are included in the Baucus legislation as receiving cuts in Medicare reimbursement over the coming decade to help offset the cost of expansions in coverage for uninsured Americans. The O&P fee schedule, however, according to the 200-page summary document, is spared any cuts in annual updates.
Competitive Bidding
The Baucus bill also expands competitive bidding and accelerates implementation of competitive bidding to 100 of the largest Metropolitan Statistical Areas (MSAs) over the next several years but does not signal any expansion in the scope of DMEPOS items and services to be competitively bid.
The bill also extends to non-competitive bidding areas average prices achieved in competitively bid MSAs. Again, this proposal would largely, if not completely, spare O&P of any major exposure to competitive bidding and reimbursement cuts that flow from it.
Medical Device Manufacturer Annual Fee
The Baucus proposal also imposes annual sector fees on companies that manufacture or import medical devices for sale in the United States beginning in 2010. This totals approximately $4 billion per year in savings to the federal government. Class I medical devices, which account for a large percentage of orthotic and prosthetic components and products, are exempted from this annual fee. Those O&P products and devices that are impacted by this proposal, on balance, represent an extremely small portion of the medical devices impacted by this provision. The annual fee would be applied according to the market share of a given company and includes an exemption for small manufacturers (i.e., sales up to $5 million).
Health Insurance Reforms that Benefit O&P Patients
Aside from the offsets necessary to pay for an expansion in coverage for uninsured Americans, all the national healthcare reform bills moving through Congress contain a series of health insurance market reforms that will significantly assist persons in need of orthotic and prosthetic care.
Assuming that orthotics and prosthetics is included in the benefit package in the final healthcare-reform legislation that is signed by the President, these market reforms will assist individuals with disabilities and those requiring O&P services in the following ways:
- Prohibiting pre-existing condition exclusions.
- Guaranteeing issue and renewability of health insurance.
- Moderating premiums by prohibiting discrimination based on health and disability status.
- Eliminating lifetime and annual caps in benefits.
- Limiting out-of-pocket costs spent on healthcare on a sliding scale dependent upon income.
- Dramatically expanding Medicaid eligibility to ensure that those with low incomes are able to access healthcare.
- Providing federal subsidies to individuals who require them in order to afford health insurance.
- Exempting small businesses from an employer “mandate” to provide insurance to their employees while providing tax credits to small business to encourage them to do so.
Coverage of Orthotics and Prosthetics in the “Essential” Benefits Package
A major problem with the Baucus approach (as of the day of this writing) is that the essential benefits package, which must be provided by private health plans that function under a new Health Insurance Exchange, is not specifically required to provide coverage for orthotics and prosthetics.
Similarly problematic for people with physical disabilities is the fact that the Baucus proposal also does not specifically provide coverage for durable medical equipment or rehabilitation or habilitation services.
NAAOP, the O&P Alliance, and a large number of disability organizations are working hard to ensure that the final healthcare-reform legislation includes coverage of these services and devices. In fact, four of the five committees that have marked up healthcare-reform legislation in the House and Senate have recognized coverage of these services in the basic package of benefits that must be provided to individuals in private plans covered under the Exchange.
NAAOP will continue to actively engage Congress and the administration to ensure that national healthcare reform efforts benefit orthotic and prosthetic patients and the providers who serve them with the least possible negative impact on orthotic and prosthetic coverage and reimbursement.
For more information, contact 800.622.6740 or visit www.naaop.org
