Wound Care Reimbursement in 2017: Manufacturers & Management Companies Speak Out

For this special edition of Today’s Wound Clinic focusing on reimbursement, we asked manufacturers and management companies based in the United States to share information on how their business models are changing in an attempt to exist in both a volume-driven and value-driven reimbursement system.

Editor’s Note: All information collected for this feature was gathered directly from the respective companies.

Alliqua Biomedical

As the healthcare payment system changes, the patients affected by chronic wounds seem to have increasingly difficult-to-heal wounds. While Alliqua BioMedical offers products that have been clinically proven to produce effective and efficient results, the struggles with integration into clinical algorithms is a significant reality of reimbursement regulations. Limited funds for payment; published coverage policies; or lack of published coverage policies, utilization guidelines, and Centers for Medicare & Medicaid Services packaged payments contribute to our angst while we work on behalf of the patient to have access to the necessary technology that will provide the best possible clinical outcome in a cost-effective manner. In some instances, the answer is looking for reimbursement-insensitive environments (inpatient). While on the surface this seems logical, it remains necessary to look at the cost of goods, how technology improves the quality of care and assists with limiting the unnecessary readmissions, and determining whether the technology can be received across the continuum of care. Obtaining document research on this is challenging at best. Understanding these hurdles is crucial to our success. We have determined that our greatest asset is the services we can provide our customers: reimbursement education and case management services. The lack of published coverage policies causes many customers to pause and question payment. Prior authorizations with the commercial payer are becoming a necessity as well as a burden. We are able to relieve some of the burden to our customers with the utilization of third-party case management services to assess coverage, reimbursement values, and contracted fees. Probably the biggest hurdle with Medicare is the hospital outpatient department packaging of payments into the primary service.  The customer must understand the nuances of status indicators, what that means to our products, and how to capture the costs of all services provided. In today’s ever-changing reimbursement environment, it’s necessary for Alliqua to provide constant education on algorithms based on clinical evidence, be certain to stress the importance of knowing utilization guidelines for the product, document appropriately based on medical necessity, and avoid overutilization. 

Alliqua BioMedical also works continuously and responsibly to provide unique purchasing options to ensure economic success and to ensure greater access to our products for all wound care patients. 

Comprehensive Healthcare Solutions Inc. 

Comprehensive has been in business since 1998 and has helped hospitals nationwide with the development of their own wound and/or hyperbaric programs. As a medium-sized firm that is not beholden to investors, Comprehensive can cater to the needs of its clients. Rather than coming in with a costly, turnkey management approach that worked during the fee-for-service era, Comprehensive will customize its services and offer alternative options that are appealing to hospitals that already have a wound care program, as well as those that are developing new programs. Large and small hospitals will benefit from having a cost-effective wound care service line that helps reduce readmissions and length of stays. Comprehensive’s focus will be on throughput analysis, careful system design, and preparation for the value-based reimbursement system so that expenses do not exceed income. Hyperbaric therapy will go through some challenges in 2017. Comprehensive has developed processes that allow clients to be compliant and successful despite the changes. 

Integra LifeSciences

The current healthcare system is structured around a fee-for-service (FFS) model. Under this model, the financial incentives encourage practitioners to deliver more services in order to increase the reimbursement they receive. For chronic wound care, this is especially relevant because many patients require multiple visits in order to achieve healing. An FFS healthcare environment may not always encourage the most cost-efficient approach to healing chronic wounds. Although the healthcare system is primarily FFS, it’s evolving and moving towards a value-based structure. Under this new healthcare dynamic, practitioners are paid not only for the services they deliver, but are also rewarded or penalized for the outcomes they create. A number of new federal programs encourage quality healthcare, such Medicare’s voluntary Shared Savings Program or the Bundled Payments for Care Improvement (BPCI) initiative. Commercial payers are also moving towards a value-based system by either contracting with private accountable care organizations or by requiring providers to submit quality and outcomes data to meet specific reimbursement benchmarks. In this new world of value-based care, Integra LifeSciences is uniquely positioned to address the chronic wound care marketplace. As the prevalence of diabetes continues to rise, affecting an estimated 29 million people in the United States, as many as 25% may experience a diabetic foot ulcer (DFU) in their lifetime.¹ Integra’s regenerative portfolio consists of two advanced cellular and tissue-based products (CTPs): Omnigraft™ Dermal Regeneration Matrix and PriMatrix^® Dermal Repair Scaffold. The clinical efficacy and effectiveness of the Integra portfolio has been widely studied in a broad range of chronic wounds, with more than 15 clinical papers reviewing more than 700 subjects. Of note, the most recent pivotal, prospective, multicenter, randomized-controlled Foot Ulcer New Dermal Replacement (aka, FOUNDER) Study reported clinically significant rates of DFU healing over the standard of care with fewer than two applications, on average.¹

Additionally, effectiveness reports show that venous leg ulcers (VLUs) managed with PriMatrix closed faster than VLUs treated with another leading CTP, with the majority of ulcers closing with a single application of PriMatrix.² Both Omnigraft and PriMatrix result in shortened healing times compared to standard therapies, and are available in a variety of sizes to better match wound dimensions and help reduce waste. Not only do the reduced number of applications lead to direct cost savings on the products and total cost of the episode of care, the cost savings potentially translates to fewer clinic visits and decreased product-related copays for the patient. The lower cost burden for the patient means that more patients will opt to receive advanced wound care therapies that may speed healing and reduce the need for limb amputation. Integra believes that lowering the overall cost of care will translate into greater access to care for all of our patients and a lower overall cost of care to the healthcare system, as well as improved health outcomes for an at-risk population. 

ManukaMed

ManukaMed^® is an emerging wound care company headquartered in Masterton, New Zealand. We started our direct-to-market United States company in 2014, and by early 2016 had started to grow in all points of care. The potency, consistency, and quality of our medical-grade honey has shown positive outcomes in all chronic wound types. However, we faced a challenge by the Centers for Medicare & Medicaid Services (CMS)/Pricing, Data Analysis and Coding (PDAC) ruling made in August 2015. We were told in June 2016 that we had to reformulate our MANUKAhd Lite dressings to conform with the dry weight 50% rule. As a small company, we listened carefully to the advice of PDAC. Within 48 hours from the time of notice we had already determined that we could make the dressing to the CMS specification and went to work on MANUKAhd Super Lite in 2-x-2”; 4-x-5”; 4-x-39”; and rope sizes. We also listened to our PDAC/CMS consultant in the U.S., who helped us get the correct materials and all the technical review information that the PDAC review team required. This was completed quickly and with urgency. When you are small and agile it does not take weeks or months to realign priorities — it’s only a matter of hours. We had extreme focus on getting this product into the market, as well as just a plain, super-absorbent gelling fiber option known as MEDSAF. The turnaround time for the manufacturing, testing, sterilization, and bioburden was accomplished in record time. PDAC received a full comprehensive file on both products. We received response letters from PDAC within 60 days, and now we can add this cost-effective option to the Medicare Part B options as fixed-fee-coded dressings covered by CMS. We feel it’s imperative as we begin 2017 to listen to the sound waves being generated by a new administration in Washington, DC, with healthcare reform and follow the guidance of telling our ManukaMed story more from a value-driven, cost-to-outcomes perspective. We want health systems to know the real value of ManukaMed-branded Manuka Honey as the highest medical grade in the world. Also, we understand wound care clinicians need options that are easy to use, safe, and have the multimodal bioactive capability we see in this precious resource from New Zealand. 

We are very excited about what the new year will bring and we will continue to grow our company around affordable care with exceptional outcomes. Being nimble with a close ear to the ground to the wound care professionals will drive us to new dressing options now in development that both clinicians and their patients will admire. Sometimes being latest to the market makes it best if you can navigate by being nimble. 

References

1. Driver VR, Lavery LA, Reyzelman AM, et al. A clinical trial of Integra Template for diabetic foot ulcer treatment. Wound Repair Regen. 2015;23(6):891-900.

2. Karr JC. Retrospective comparison of diabetic foot ulcer and venous stasis ulcer healing outcome between a dermal repair scaffold (PriMatrix) and a bilayered living cell therapy (Apligraf). Adv Skin Wound Care. 2011;24(3):119-25.