I am seeing more HME provider spokespersons quoted in print stating that reductions in service levels will be their answer to reduced fees. I am wondering if this is troubling others in the provider community. When were we given permission to reduce the level of service?

I understand that those spokespersons may intend to say that cost reductions are necessary for the future of their businesses. There is nothing wrong with that. But when I hear that service levels are being reduced, I am concerned about the message being given to medical professionals and consumers, not to mention third-party payors. Publicly stating that we are at liberty to determine service levels—“quality of care” to everyone else—is not in our best interest and, in fact, is not true.

Our industry is, after all, dependent upon adhering to standards that have been set primarily by health professionals. This fact is the underpinning for our industry’s significance and integrity, and it also justifies our fees. The featured letter is our company’s response to the insurance company desiring to purchase our equipment (see letter).

If quality of care were negotiable or determined by anyone other than the patient’s physician, this approach would undoubtedly be less successful than it has turned out to be for my company. As it stands right now, the physician, consumer, and even the insurance industry expect the highest possible level of service. Who wants to tell them it is our intention to provide less?

September 17, 1999

Independent Insurance Co.
3 Main Street
Anywhere, NJ 08000

Dear Sir,

We are in receipt of your request for the purchase price of equipment in use by your insured. The procedure codes referenced are for a range of services that we do not provide on a basis other than rental.

Our firm provides respiratory care, not medical equipment for do-it-yourself oxygen therapy. As a result, we provide oxygen equipment under the following guidelines:

  1. Oxygen concentrators and/or portable oxygen units are categorized as “frequently serviced equipment” by the Health Care Financing and Social Security Administrations. Any program utilizing the Medical Policies of these Federal agencies provides for continuous rental of equipment without provision of purchase.
  2. Under our rental contract we provide USP grade oxygen delivered to your insured with the necessary accuracy to meet the requirements of the physician’s prescription for this patient.
  3. Under a rental contract we provide oxygen for the duration of daily use as prescribed by the physician.
  4. Under a rental contract we provide monitoring of the patient’s medical status, as is expected by the physician.

Therefore, without a change in the care plan that was referred to us for this patient by the physician or evidence of the physician’s desire to reduce the level of care being received by this patient, we are not at liberty to adjust our care, briefly outlined above, as can be provided only through our rental arrangement with you.

I hope this clarifies our reason for declining your request. If you have any questions, please contact me.

Very truly yours,
Dana S. Green, President

Dana S. Green is president of Oxygen Support Systems, a home respiratory care company based in Cherry Hill, NJ. He can be reached at (856) 765-0900.