Highmark Medicare Services (HMS) confirmed with remote monitoring service provider CardioNet that the reduced reimbursement rate for mobile cardiovascular technology will become effective today, September 1, 2009. The new rate is $754 per service and that represents a 33 percent reduction from the $1,123 reimbursement rate the service has retained all year.
"We are very disappointed at HMS' decision and believe strongly that CardioNet and other industry providers brought compelling data to HMS to justify a higher level of reimbursement," CardioNet Chairman, President and CEO Randy Thurman stated. "We will be persistent in pursuing every appropriate means to remedy this situation. Mobile cardiac telemetry technology has now been used in over 300,000 patients nationwide and utilization of CardioNet's MCOT continues to grow among cardiologists and electrophysiologists. The industry invested hundreds of millions of dollars in research and development and building infrastructure to bring MCOT technology to the market. Physicians, payors and, most importantly, patients have benefited greatly from this technology. This surprise decision by HMS on July 10, 2009 must be readdressed and not be allowed to put at risk either the investment in new technologies or the benefit to the patients we serve."
CardioNet competitor LifeWatch also received confirmation from Highmark Medicare Services that the new, reduced reimbursement rate would go into effective today. The company sent out a press release that noted that "in addition to the information LifeWatch has already provided to Highmark, the company and the coalition of Independent Diagnostic Testing Facilities (IDTFs) will continue to compile and submit further information to demonstrate that the revised reimbursement rate is inappropriately low."
For more on CardioNet, its competitors and the reduced reimbursement rate, check out these related articles:
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For more from CardioNet's press release, read on:
CONSHOHOCKEN, Pa.-- CardioNet, Inc. (NASDAQ:BEAT) announced that Highmark Medicare Services (HMS) confirmed it will implement its reduced reimbursement rate for mobile cardiovascular technology on September 1, 2009. The rate - $754 per service - represents a 33 percent reduction from the $1,123 reimbursement rate which HMS had just published in May 2009. In communications between CardioNet and HMS in April 2009, HMS had also said there was no pending change. Then on July 10, 2009, for the first time and inconsistent with HMS' previous history of communicating such changes, CardioNet received written notice of the planned decrease. HMS provided CardioNet with no advance opportunity for dialogue related to this dramatic change.
CardioNet has worked with HMS to provide complete and fact-based information that the Company believes substantiates a significantly higher rate of reimbursement. In its communication to CardioNet today, HMS stated CardioNet can provide additional information and that HMS would review it within a reasonable time and further adjustment to the allowance would be made, if appropriate. CardioNet intends to pursue this approach as well as work with CMS to arrive at a justifiably higher level of reimbursement.
Randy Thurman, CardioNet Chairman, President and CEO, commented, "We are very disappointed at HMS' decision and believe strongly that CardioNet and other industry providers brought compelling data to HMS to justify a higher level of reimbursement. We will be persistent in pursuing every appropriate means to remedy this situation. Mobile cardiac telemetry technology has now been used in over 300,000 patients nationwide and utilization of CardioNet's MCOT continues to grow among cardiologists and electrophysiologists. The industry invested hundreds of millions of dollars in research and development and building infrastructure to bring MCOT technology to the market. Physicians, payors and, most importantly, patients have benefited greatly from this technology. This surprise decision by HMS on July 10, 2009 must be readdressed and not be allowed to put at risk either the investment in new technologies or the benefit to the patients we serve."
Based on the significant impact this price reduction would have on CardioNet's current business model and the ongoing nature of the Company's efforts to address the situation, the Company will continue to refrain from providing updated guidance at this time.
About CardioNet
CardioNet is the leading provider of ambulatory, continuous, real-time outpatient management solutions for monitoring relevant and timely clinical information regarding an individual's health. CardioNet's initial efforts are focused on the diagnosis and monitoring of cardiac arrhythmias, or heart rhythm disorders, with a solution that it markets as Mobile Cardiac Outpatient Telemetry (MCOTTM). More information can be found at http://www.cardionet.com.
