Five-year rule haunts mobility providers

WASHINGTON - The five-year “reasonable useful lifetime” rule for capped rental items has been on the books for years, but mobility providers are just starting to feel its sting.

All power wheelchairs became capped rental items in January 2011, when the first-month purchase option was eliminated. The DME MAC for Jurisdiction D reminded providers in June that that means they're on the hook for replacing power wheelchairs if they don't last five years.

"The people that put out the poor quality equipment are the ones that are going to get hurt by this," said Peggy Walker, a billing and reimbursement adviser for U.S. Rehab.

The DME MAC stated: “A supplier that transfers title to a capped rental item to a beneficiary is responsible for furnishing replacement equipment at no cost to the beneficiary or to the Medicare program if the carrier determines that the item furnished by the supplier will not last for the entire reasonable useful lifetime established for the equipment. In making this determination, the carrier may consider whether the accumulated costs of repair exceed 60 percent of the cost to replace the item.”

Putting out quality equipment is becoming more and more difficult for providers. With reduced reimbursement chipping away at their margins, they've had to cut costs, including those associated with purchasing equipment.

"Something has to give, and unfortunately, it looks like quality is the factor in many cases,” said Martin Szmal of The Mobility Consultants.

Provider Aaron Lauver says he makes an effort to provide quality equipment, because he knows it will offset future repair costs. But sometimes even that's not enough to get power wheelchairs to last five years.

"The reality is, people use their chairs inside and outside," said Lauver, owner of Montandon, Pa.-based Susquehanna Valley Mobility. "When you have a wheelchair that's designed to be used in the home, if it's being used for community mobility, it won't hold up for five years."

The rule could have the greatest impact on providers of more complex power wheelchairs. That's because the consumers who use those chairs use them every day, all day, in and outside the home.

"A spinal cord injury patient uses their wheelchair to work and play every day," said Simon Margolis, executive director of NRRTS. "That means more repairs in the long run."

Industry stakeholders are waiting for more information from the DME MAC about how it plans to enforce the rule.

Read the notice here.