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For years, the home oxygen industry has failed in many ways the more than 1 million Americans who suffer from breathing difficulties. As ProPublica has revealed, Lincare, the nation’s largest respiratory distributor, has a decades-long history of ripping off Medicare and seniors. Philips Respironics hid serious problems with its sleep apnea device, leading to devastating consequences, including reports of deaths. Other major respiratory companies have paid millions of dollars in fraud settlements.
But as this Congress draws to a close, advocates for oxygen patients are forging seemingly impossible alliances with companies that have harmed oxygen patients, among other things, to pay compensation to an industry hurt by scandals. Finally, we are pushing forward with a bill to pay for this. That’s hundreds of millions of dollars more than what we’re currently receiving. Patients, many of whom are elderly and frail, are bombarding lawmakers in meetings, phone calls and emails, urging them to pass the Supplemental Oxygen Access Reform (SOAR) Act by the end of the year. Business and patient advocates have vowed to push for reintroduction, potentially next year, if the bill fails to pass this term.
The SOAR Act would accomplish two long-sought goals for an industry that derives much of its revenue from Medicare. The bill would protect companies from additional billing cuts by removing oxygen from Medicare’s competitive bidding program, which could have saved taxpayers hundreds of millions of dollars. And it will be much harder for the government to contest these claims.
On the other hand, patient organizations have their own goals. It aims to improve the industry’s notoriously poor services and ensure access to expensive liquid oxygen for a relatively small group of critically ill patients. This form of oxygen is coveted by patients with advanced lung disease because it provides the necessary high flow rates that last for several hours in an easy-to-carry cylinder. Lobbying for the bill’s passage has featured emotional accounts of disaster-affected patients who are unable to obtain the equipment they need.
“The current situation is pretty dire,” said Susan Jacobs, a respiratory research nurse manager at Stanford University Medical Center, who has studied access to oxygen therapy for more than a decade and supports the bill. “Patients are not getting the oxygen equipment they need, nor are they receiving education or training on how to use it. The SOAR Act addresses multiple issues.”
Jacobs and other advocates acknowledge a history of bad behavior by oxygen companies. “Before, I felt like they were the enemy,” Jacobs said. Erica Seward, vice president of national advocacy for the American Lung Association, another supporter of the SOAR law, said, “Some companies have been acting in very bad faith with taxpayers’ money.” he added.
But patient advocacy groups are now backing up the industry’s long-standing complaint that Medicare payment cuts go too far. “I’ve become convinced of this over the past five years or so,” Seward said. “Competitive bidding is not paying enough. … I have complete confidence that the suppliers are negotiating from a very honest standpoint on behalf of the patients,” she added. “Unless everyone compromises, nothing will change. They obviously have a financial stake.” (Seward said the American Lung Association receives no funding from oxygen companies or industry groups.)
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The SOAR Act currently has six sponsors in the Senate and 31 sponsors in the House, including Republican senator Bill Cassidy of Louisiana, a physician, and Democratic senators Mark Warner of Virginia and Amy of Minnesota. It was first submitted by Klobuchar in late February. “Respiratory treatments save the lives of too many patients, but too often this treatment is cost-prohibitive or simply inaccessible,” Warner said in a statement published at the time. This was stated in a joint press release. Cassidy, Warner and Klobuchar did not respond to requests for comment.
The SOAR Act would not only protect against further reductions in Medicare rates for things like oxygen concentrators (the bill would essentially freeze them at current levels), but would also provide standardized medical care for approving supplier claims. You will be creating a form. Paying companies like Lincare to provide respiratory therapist services. And that’s more than double what companies pay for liquid oxygen systems.
A private study partially funded by industry estimates that the bill will cost taxpayers about $654 million over 10 years (SOAR Act supporters decline to release the study). ). The nonpartisan Congressional Budget Office has not yet produced an estimate. Beneficiaries would also have to pay an additional fee to the company as part of their 20% Medicare copayment.
Liquid oxygen has long been virtually unavailable, even to Medicare beneficiaries who need it most. In 2004, suppliers provided portable liquid oxygen devices to more than 80,000 Americans before government payments for oxygen, historically a luxury, began to be cut.
Fewer than 4,000 Medicare patients received liquid oxygen in 2021, according to Medicare data. That’s just a fraction of the 1.5 million Americans currently receiving some form of supplemental oxygen. Supporters of the bill say there are thousands of Medicare beneficiaries who desperately need liquid oxygen to live a more normal life. “We’re ordering liquids,” Jacobs said. “Our [suppliers] “We don’t have it and we can’t provide it.” That’s not acceptable. Patients need to be able to get enough oxygen to leave the house. They can’t go to religious services, see their families, or go to their children’s graduations. These are heartbreaking stories. ”
Under a competitive bidding program launched in 2011, oxygen companies were legally required to provide fluid systems to patients prescribed by a doctor. However, both companies argued that the rates agreed during the bidding process were too expensive. Providing liquid oxygen stored under high pressure and subzero temperatures in specialized equipment requires specialized trucks, frequent deliveries, and drivers with hazardous materials certification.
Medicare enforcement officials never policed the companies. And in 2019, the federal government “paused” the oxygen bidding program and many of its reimbursement rules — five years later, without saying when they would be replaced or reinstated — allowing companies to supply liquid oxygen. freed from the obligation to
In a statement, a Medicare spokesperson reiterated the program’s longstanding claim, which has been challenged by industry and patient groups alike, that access to liquid oxygen is not a major problem. The supplier complied and agreed to supply liquid oxygen; [supplier] As a result, the contract was terminated. ”
The SOAR law also includes what advocates call a “patient bill of rights,” which they see as a major concession for oxygen companies. Aimed to address widespread and disastrous services, this bill and other parts of the bill require Medicare payments to include equipment set-up assistance and monitoring, patient education, and 24/7 access during emergencies. It requires suppliers to provide compensation. (It remains an open question how the federal government, which has historically had a poor enforcement record, would police such rules.)
Lincare has long argued that Medicare cuts and what Medicare describes as a “flawed” competitive bidding program are to blame. The company told the agency in a 2017 letter that low reimbursements and “onerous documentation requirements” made it “nearly impossible to continue providing quality service to beneficiaries.” Still, Lincare appears to be collecting significant profits. In 2023, the company generated profits of about $300 million on sales of $2.4 billion, according to a former company executive. (Lincare declined to comment.) Rotech, another major player in the home respiratory business, was acquired this year for $1.36 billion after posting a profit of $200 million in fiscal 2023.
Such profits allow the industry to spend lavishly on Capitol Hill. Its lead industry association is the Quality Respiratory Care Council, which is comprised of six major manufacturers or distributors of oxygen equipment, including Lincare and Philips, and is chaired by Lincare’s CEO. Since 2018, each of the six CQRC companies has reached at least one multi-million dollar settlement with the government for defrauding Medicare. Companies typically deny wrongdoing.
Lobbying payments on reimbursement issues by trade associations and their member companies have totaled more than $1.4 million since the beginning of 2023. CQRC’s outside PR firm won an industry “advocacy” award for its 2016 campaign supporting legislation to delay oxygen reimbursement cuts. He boasted of sending 29,000 emails to members of Congress. Through these efforts, the award citation notes, “a committed community of concerned citizens has been formed to support CQRC’s efforts.”
In a statement in response to questions from ProPublica, CQRC said the SOAR Act would provide “long-overdue Medicare reform” and correct service problems that patients and their advocates have often blamed on the industry. It was praised as such. The trade group blamed “current law” and “chronic underfunding” for causing patients “to often be unable to receive medically necessary home respiratory care prescribed by their doctors.” said it would establish “clear patient protections and provider responsibilities” while protecting Medicare. Beneficiaries from “potential fraud and abuse.”
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Meanwhile, new government-funded academic research challenges industry claims about the harms of competitive bidding for oxygen services. The study, published in late October in JAMA Internal Medicine, examined Medicare data to determine the impact of the bidding program on patients with chronic obstructive pulmonary disease, by far the largest group of Medicare oxygen recipients. A comparative study was conducted.
The conclusion was that competitive bidding saved taxpayers and patients hundreds of millions of dollars without restricting access to oxygen or jeopardizing health. Dr. Kevin Duan, assistant professor of respiratory medicine at the University of British Columbia and lead author of the study, told ProPublica that his team’s study found no evidence of harm, adding that “there are no evidence of harm, including reduced claims and improved clinical outcomes.” There is no change.” Duan said the study sparked a backlash from supporters of the measure. “We knew this directly called into question parts of the SOAR law,” he told ProPublica. “It feels like we’re walking into a firestorm.”
“There are no horses in this race,” Duan said. “There’s a lot of criticism of competitive bidding programs without a lot of data. We rarely get high-quality evidence that can directly inform parts of the law, and it shouldn’t be ignored.”
Doris Burke contributed to the research.
