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1992.12.07 :  Medicare Durable Medical Equipment

Contact: Anne Verano 202-690-6145
December 7, 1992

       Medicare will save more than $2 billion over five years by
modifying fee schedules for durable medical equipment, HHS
Secretary Louis W. Sullivan, M.D., said today as he announced a
regulation specifying the changes.
       The changes will be fully implemented in 1993, the final
year of a three-year phase-in.  A final regulation defining the
new payment rules is published in today's Federal Register. 
       Secretary Sullivan said the revisions "reduce wide
geographical differences in payment rates for identical medical
equipment. Medicare payments for the same item of durable medical
equipment will not vary by more than 15 percent between
geographical areas."
       The changes implement provisions of the Omnibus Budget
Reconciliation Act of 1990 and earlier legislation mandating
reforms in the Medicare system of paying for durable medical
equipment.
       National payment ceilings and floors apply to all
categories of durable medical equipment except orthotics and
prosthetics such as braces, artificial limbs and ostomy supplies. 

    Currently, 34 Medicare carriers have 54 fee schedules based
on historic local charges, and fees vary widely.  Carriers are
insurance companies under contract with Medicare to process claims.
    William Toby Jr., acting administrator of the Health Care
Financing Administration, said the changes in the payment system

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"will bring greater uniformity and predictability to Medicare
payments for medical devices.  This and other initiatives will
help to curb fraud and abuse in the purchase and rental of durable
medical equipment."
    The interim final regulation includes provisions that have
been implemented to protect beneficiaries from misleading marketing
practices by suppliers.
    Among these provisions is a requirement that written orders
from physicians be given to suppliers before certain expensive kinds
of equipment are delivered to Medicare beneficiaries.  This provides
beneficiaries with reasonable assurances that medical devices they
purchase are appropriate for their medical needs and reimbursable by
Medicare.
    Written physician orders are required before delivery of
seat-lift mechanisms; power-operated devices used as wheelchairs;
special mattresses and cushions for controlling decubitis (bed
sores); and transcutaneous electrical nerve stimulators for treating
muscular pain.  Other devices will be added to the list as needed to
protect beneficiaries from misleading marketing practices. 
    Comments on the regulation defining the payment rules will be
considered if submitted within 60 days to the Health Care Financing
Administration, Attention: BPD-494-IFC, P.O. Box 26676, Baltimore,
Md. 21207.

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