Senate Bill S5118A

                                
 
BILL NUMBER: S5118

SPONSOR: RIVERA
 
TITLE OF BILL:

An act to amend the social services law, in relation to providing parity
to durable medical equipment providers by requiring Medicaid managed
care organizations to reimburse such providers at no less than one
hundred percent of the state's Medicaid durable medical equipment and
complex rehabilitation technology fee schedule for the same services and
supplies

 
PURPOSE:

This bill provides parity to durable medical equipment providers and
requires Medicaid managed care organizations to reimburse such providers
at no less than one hundred percent of the state's Medicaid durable
medical equipment and complex rehabilitation technology fee schedule for
the same services and supplies.

 
SUMMARY OF PROVISIONS:
              

Section one of the bill amends section 367-w of the social services law
to require Medicaid managed care organizations to reimburse durable
medical equipment providers at no less than one hundred percent of the
Medicaid durable medical equipment and complex rehabilitation technology
fee schedule for the same service or item of durable medical equipment,
prosthetics, orthotics and supplies.

Section two of the bill relates to the effective date.

 
JUSTIFICATION:

Durable Medical Equipment ("DME") is equipment that is considered
medically necessary as prescribed by a physician for use in a patient's
home. DME includes equipment such as wheelchairs, powered mobility
devices, hospital beds, oxygen systems, ventilators and respiratory care
supplies, as well as orthotics and prosthetics. For Medicaid consumers
with a disability, DME can improve safety while decreasing the need for
caregiver assistance. It can substantially improve overall quality of
life by increasing a consumer's independence with functional mobility
and activities of daily living ("ADLs"). Medicaid members who use DME
services may regain independence in the hopes of returning to their
prior level of function and home environment rather than needing costly
institutional care.

In recent years, Medicaid managed care organizations have reduced
reimbursement on DME products to unsustainable levels. Many MCOs reim-
burse DME providers less than half of the Medicaid fee-for-service fee
schedule for identical devices and supplies paid in the fee-for-service
system. This reimbursement reduction is compounded by the fact that the
majority of their members are enrolled in a Medicaid Managed Care Plan,
which comprises approximately 75 percent of their revenue.

This MCO rate reduction has caused numerous access issues throughout the
State. Medicaid consumers and their physicians face challenges finding a
DME supplier. Over 20 percent of providers have closed in recent years,
and twelve counties do not have a DME location. Without reimbursement

parity, additional DME providers will close and consumers will no longer
be able to access medically necessary services.

The requirement of parity has been enacted in other areas of the Medi-
caid program, including behavioral health.  In addition, other States
have implemented payment parity legislation and have established rate
floors, including Virginia, Kentucky and North Carolina.

 
LEGISLATIVE HISTORY:

New Bill

 
FISCAL IMPLICATIONS:

No fiscal

 
EFFECTIVE DATE:
This act shall take effect on the ninetieth day after it shall have
become law.