Reply to Healthcare Economist

August 31, 2009 at 10:48 am

Michael Reinemer, American Association for Homecare
With respect to oxygen and durable medical equipment, it’s worth noting that Congress has already cut Medicare reimbursement rates for home oxygen therapy numerous times over the past 10 years — in 1997 (BBA), 2003 (MMA), 2005 (DRA), and 2008 (MIPPA). Reimbursement rates have been cut by nearly 50 percent over the past decade, so those savings from the bid program have been realized already through congressional action. Today, Medicare pays about $6 per day to provide a senior with home oxygen therapy, which about one million Medicare beneficiaries depend on in order to breathe. For comparison, an average Medicare day in a hospital costs more than $5,000. Unfortunately, the law only allows Medicare to reimburse of oxygen devices and the oxygen itself, but not for most of the essential services required for furnishing home oxygen therapy in the homes of seniors with COPD and other severe lung diseases.

A similar history of cuts have been applied to durable medical equipment. According to the most recent National Health Expenditures data from CMS (2006-2007), the durable medical or home medical equipment sector is growing at less than one percent per year, compared to more than six percent for Medicare overall. So clearly, oxygen and durable medical equipment generally are not major cost drivers in Medicare. In fact, home medical care is an essential part of the solution to Medicare’s approaching funding crisis.

See more information at the American Association for Homecare website, or

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