In wake of cuts, HME providers let chips fall

YARMOUTH, Maine - It's only been a month since CMS rolled out draconian reimbursement cuts across the country, but HME providers have begun playing hardball.

“Our company's posture is we don't want a Medicare patient unless the paradigm changes,” said George Kucka, president and CEO of Schererville, Ind.-based Fairmeadows Home Health Care.

CMS on July 1 implemented the Round 2 re-compete of competitive bidding, and as part of a nationwide roll out of the program, phased in the second of two 25% reimbursement cuts in non-bid areas.

Kucka, who is located in a bid area, says the low payment rates, combined with a large number of out-of-area contract suppliers, have referral sources crying foul.

“We are starting to get more calls from hospitals wanting to know where to complain,” he said. “We're directing them to the lawmakers' offices and to the People for Quality Care hotline. We're certainly not directing them to CMS.”

Provider Mike Kuller got out of the Medicare business several years ago to focus on retail, but he's selling plenty of hospital beds and walkers—for cash.

“People are struggling to get things through Medicare—the companies are backed up and in no hurry,” said Kuller, owner of Allstar Medical Supply in Walnut Creek, Calif., a bid area. “I had a customer who was told by Lincare that it would take six weeks to get a walker.”

If they're not in a bid area or they don't have a bid contract, other providers are washing their hands of products and services they've offered for decades.

Provider Gary Sheehan made headlines when he announced that his company would no longer accept new oxygen patients on the island of Nantucket more than 25 miles off the coast of Cape Cod.

“It's just not possible—the rates don't come anywhere close to being able to provide service,” said Sheehan, president and CEO of Sandwich, Mass.-based Cape Medical Supply. “We will continue to take care of the patients we have.”

Provider Cory Baker is determining on a product-by-product basis whether or not to continue accepting Medicare assignment. It's unfortunate for the beneficiaries, but it's a necessary evil, he says.

“Until our industry stops taking items on assignment, Medicare is going to assume everything is fine and keep (making cuts),” said Baker, compliance officer at Abilene, Texas-based Choice Medical Supply.