A battle has been looming with congress for over 20 years for a clear definition of policy coverage for Medicare pulmonary rehabilitation coverage. The current coverage is scattered among territories that state governments contract out to write policies for coverage known as Fiscal Intermediaries (FI). Many states will adopt the policy of others and join their territory of coverage and contract the same FI to write their policies. For example, West Virginia and Virginia have the same FI, United Government Services that drafts all of their coverage plans. Both of these states provide liberal coverage and a multidisciplinary plan. All hospitals that operate pulmonary rehabilitation programs within these states must operate under the Local Medical Review Policy established by the FI in regards to Medicare billing. The LMRP dictates that the program must have a medical director, all services must be medically necessary, performed by a multidisciplinary team operating off a treatment plan, and must stop as soon as a patient is able to perform these services on their own in an unskilled environment or a predetermined number of sessions have been reached whichever comes first. This type of program works very well for most Medicare recipients, however; there is admission criteria and a standard of care that must be maintained (Advocacy, 2006).

Other states currently have no LMRP in place for pulmonary rehabilitation, which means there is no coverage for patients that require these services. These states have elected not to provide for the needs of their pulmonary population. Medicare's decentralized local coverage policy process leads to policy variation, raising serious equity and quality issues. This is one of the strongest arguments for a national LMRP (Foote, Wholey, Rockwood, & Halpern, 2004).

HCFA has refused to write a standardized national pulmonary rehabilitation coverage policy due to a fear of the increase in claims it would create. There are potentially millions of dollars at stake if the coverage passes because of increased access to services. However, the government has lost sight of the potential savings it could create by keeping patients healthy and out of the hospital. The absence of a national coverage policy for pulmonary rehabilitation has the practical effect of limiting or denying access to many Medicare beneficiaries.

The proposed plan would have some of the nuts and bolts of existing LMRPs with a few additions. The coverage would be national with no variations among the states and all states must participate. The program would be physician directed and all services ordered must meet medical necessity. Services must be reasonable and necessary for the diagnosis or active treatment of the individual's condition. Education would be considered an integral part of any pulmonary rehabilitation program. A psychosocial evaluation would be warranted for patients that may have social adjustment disorders. Patients are expected to show measurable improvement for therapy to progress. Every program must have a medical director that has expertise in dealing with pulmonary pathophysiology, be licensed to practice in the state, and have substantial involvement in the direction of patient outcomes (The Library of Congress, 2005).

Medicare approved a study of 1000 patients who had emphysema and were treated with Lung Volume Reduction Surgery (LVRS) in the National Emphysema Treatment Trials (NETT). This surgery is designed to remove parts of the lung that are no longer participating in ventilation so that the unaffected part of the lung can operate more efficiently. Half of the participants were required to participate in a pulmonary rehabilitation program for at least 5 weeks prior to surgery and the other half were not. The study revealed that patients who participated in pulmonary rehabilitation had a much quicker recovery and were discharged sooner from the hospital than those patients who did not attend. The NETT trials have resulted in Medicare mandating that LVRS patients attend pre and post pulmonary rehabilitation before Medicare will authorize the approval of LVRS. Hospitals throughout the country are vying to be one of the locations that are eligible to perform LVRS and needless to say they will have to have a pulmonary rehabilitation in program in place before they would be considered an optimum site (Gibbons, 2006).

The cost of national pulmonary rehabilitation coverage could be staggering. The Medicare government insurance program is already financially struggling with the introduction of part d prescription coverage. Even with conservative estimates it will cost Medicare at least 300 million just for LVRS patients to receive pulmonary rehabilitation. This number would probably only account for a small portion of patients if national coverage is passed. Keeping in mind that emphysema leading to LVRS is only one of about 20 diseases that patients could acquire in which they could benefit from receiving pulmonary rehabilitation.

Medicare obviously is the government agency with the most to lose if the national pulmonary coverage is passed. The public health care system is already financially vulnerable with the additional drain of prescription drug coverage it is hard to see how it could absorb another huge expenditure like national coverage for pulmonary rehabilitation. The plan is expected to go bankrupt within 20 years in its current state without any extra expenditure.

The American Association of Respiratory Care (AARC) has lobbied for coverage clarity and would be considered by most the contributing factor if the bill is passed. The AARC would gain momentum on any future legislative issues. Their membership constituency would most likely increase as well. Some respiratory therapists are reluctant to pay the moderately priced membership fees the AARC charges; however, a political victory on a large issue such as this one may make potential members feel they would receive a good return on their investment.

The American Association of Cardiovascular and Pulmonary Rehabilitation Programs (AACVPR) is a lobbyist organization representing people that work in pulmonary and cardiac rehabilitation. This organization stands to benefit if national coverage is approved because there will be a dramatic increase in the number of pulmonary rehabilitation programs throughout the United States and most of these programs will join the AACVPR. The organization acts as an accrediting body to the cardiopulmonary rehabilitation industry and charges annual accreditation fees for member hospitals.

The American Lung Association has devoted most of its lobbying efforts towards tobacco legislation, but the organization is strongly advocating the bill. Pulmonologists stand to gain from the legislation being passed as all pulmonary rehabilitation programs must have a compensated medical director. The American Hospital Association had not advocated the bill either way. Hospitals of course have a vested interest in the bill and could be winners or losers depending on how reimbursement for the service is packaged and at what rate.

The biggest issue with the policy if it is passed is the package that it would be presented under. If the coverage will pay for services but they are bundled as a one set fee per day regardless of services provided unless the fee is very high it will be a negative for all stakeholders. For example, cardiac rehabilitation programs currently operate under such fee structures allowing only a flat fee to be billed daily regardless of services rendered. This means that no services are line item billable. The average rate Medicare will pay for is 80 percent of a charge of around 106 dollars varying slightly state to state. Most cardiac rehab programs are not financially viable and hospitals frequently close them down when looking to reduce costs. They are also reluctant to open such programs because they can add very little to the bottom line. If pulmonary is presented in the same manner it would be logical that the outcome would be the same. If the new policy will pay for unbundled services that are medically necessary by discipline and that are line item billable than all stake holders would benefit with the exception of the Medicare insurance plan, which would face even more financial strain.

Hospitals would be reluctant to start new programs if reimbursement is not feasible. Existing programs operating in states with LMRPs may at some point be unable to provide services for the same reason. Patients will not receive the same level of care from a bundled service because hospitals will try to operate programs with skeleton staff because of lower reimbursement a multidisciplinary team would not be in the budget for most programs. A major concern is that providing national coverage may actually reduce patient access to programs if the level of reimbursement is not high enough for hospitals to realize an operating profit they may focus their efforts on other outpatient services that yield better profit margins.