CMS Competitive Bid DMEPOS Testimony by Nancy Schlicting CEO Henry Ford Health System

Statement by Nancy M. Schlichting President & CEO, Henry Ford Health System
Detroit, Michigan
For the Committee on Energy & Commerce Subcommittee on Health Of the U.S. House of Representatives

"...At Henry Ford, we work to get patients home safely from the hospital as soon as they are clinically ready, so that beds are available for new patients. We work to prevent readmissions and lower use of the ER.

Our Coalition includes the Michigan Health and Hospital Association and many of the nation's premier health systems, such as the University of Michigan and University of Iowa, the University of Pittsburgh Medical Center, the Henry Ford Health System, Advocate Health in Illinois, Aurora Health Care in Wisconsin, BayCare in Florida, the Cleveland Clinic, Banner Health in Arizona and Colorado, Providence in Oregon and Washington, Meridian Health in New Jersey.

We estimate that patient care and costs at more than 200 hospitals would be adversely affected, unless the DME competitive bidding program can be reconfigured.

In many cases, the ability to send a patient home or into nursing care depends on the availability of numerous items of DME -- a hospital bed, surgical supplies, diabetic supplies, a wheelchair, a commode or oxygen. Coordinating the supply and delivery of DME is critical to avoiding extra days in the hospital -- extra days that Medicare, Medicaid and private insurers will not pay for immediately. But these costs do get folded into the overall cost of health care.

Where DME and other post-acute care is aligned with the hospital, we can respond to demands of Medicare and private insurers for better care at lower cost, with very high patient satisfaction. Having to use an outside DME company, or several companies in the case of complex patients, destroys this crucial alignment and perpetuates an inefficient and costly business model.

III. Case Studies on Cost BayCare. During 2008, the HomeCare Division of BayCare Health System in Florida examined 37 cases where hospital discharge did not occur as expected. This was part of an internal Six Sigma study. In every case, delays were associated with an outside DME provider. These delays resulted in 79 additional days in the hospital for these 37 patients. Generally, we estimate approximately $1,500 per day for extended inpatient stays, including basic hotel services and the unavailability of the room for new paying patients.

Even though extra days in the hospital may not immediately and directly cost Medicare Part A more, the cost for unnecessary days remains in the health system, and eventually everyone pays for it. Savings estimates for competitive bidding focus primarily on price reductions for Durable Medical Equipment under Part B. What is left out of the picture is the increased costs at the hospital and within our health systems...."

For entire transcript of Statement by Nancy M. Schlichting President & CEO, Henry Ford Health System

Links to transcript (pdf) -

republicans.energycommerce.house.gov/.../Schlichting_Testimony.pdf

democrats.energycommerce.house.gov/.../Sclichting.Testimony.09.15.2010. pdf

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Tags:

• CBA
• COMPETITIVE BID
• MEDICARE
• CONTINUUM OF CARE
• DME
• CMS