Invacare Corporation Questions Accuracy of U.S. Inspector General's Report on Medicare Payments for Home Medical Equipment; Invacare Executive Testifies Before the US Senate

Business Wire, June 13, 2002

Business Editors, Health/Medical & Insurance Writers

WASHINGTON D.C.--(BUSINESS WIRE)--June 13, 2002

Invacare Corporation (NYSE:IVC) was the only representative from the home medical equipment (HME) industry at a hearing of the U.S. Senate Committee on Appropriations' Subcommittee on Labor, Health and Human Service and Education concerning the issue of Medicare reimbursement for all home medical equipment.

David T. Williams, director of government relations for Invacare Corporation, the global leader in the manufacture and distribution of home medical products, testified on Wednesday to express the HME industry's concern on this issue. He challenged the conclusions of a report released June 12 by the Office of Inspector General (OIG) that compared Medicare reimbursement for home medical equipment with the lower prices paid by the Department of Veterans Administration for comparable equipment. The report's conclusions are invalid, said Williams; it compares the Department of Veterans Administration, which provides only the equipment, with the combination of equipment and services that individual consumers receive from HME providers under Medicare.

"Invacare and the industry support legitimate proposals to save money for beneficiaries and the Medicare Trust Fund," Williams said after the hearing. "However, we fear that some Members of Congress will blindly accept unproven recommendations that will negatively affect the quality of care and the quality of life for millions of Americans and harm small businesses. We look forward to maintaining an open and productive dialogue with Congress as it tries to reform Medicare while insuring the best possible care and quality of life for beneficiaries and their families."

In his written statement and oral testimony in response to questions from members of the committee, Williams pointed out that "inherently reasonable pricing" under Medicare does not equate to fees that are equal to what the Department of Veteran Affairs (VA) pays for what appear to be the same products. Williams acknowledged that there "must be a fair and accurate mechanism in place to insure that the Medicare program is not being overcharged for the goods and services we provide."

"On behalf of Invacare Corporation and the entire HME services industry, I respectfully ask that you reject the report of the OIG presented today and instruct the Centers for Medicare and Medicaid Services to use its inherent reasonableness authority judiciously and base all decisions on accurate and appropriate data and comparisons."

Williams emphasized the significant service component associated with home medical equipment and supplies. "Under Medicare, HME is not a commodity. It is a combination of goods and services for which providers have a right to be adequately and fairly compensated. "

Other witnesses included Janet Rehnquist, Inspector General with the US Department of Health and Human Services, Leslie G. Aronovitz, of the General Accounting Office and Thomas A. Scully, Administrator of the Centers for Medicare and Medicaid Services.

Invacare Corporation (NYSE:IVC) is the global leader in the manufacture and distribution of innovative home medical products which promote recovery and active lifestyles through more than 25,000 providers. The company, which had 2001 revenues of $1.05 billion, goes to market in the following channels of distribution: rehab equipment, home care, mass retail and institutional. The company's headquarters are in Elyria, Ohio. For more information about the company, visit Invacare's website at http://www.invacare.com.