All-States blames audits, cuts for layoffs

Thursday, February 27, 2014

FLETCHER, N.C. – All-States Medical Supply has laid off eight employees due to soaring audit rates and recent cuts in Medicare reimbursement, according to a release.

When All-States won a contract as part of the national mail-order program for diabetic supplies in 2013, it planned to hire 50 more employees to meet an increased in demand.

But now, as the company is dealing with the steep cuts associated with the program, audits hold hundreds of thousands of dollars in limbo, said President Jason De Los Santos in the release.

“The layoffs were a devastating decision for us, but one we had to make to keep our head above water,” he said.

All-States is diversifying into retail stores and therapeutic shoe fittings, as well as adding an on-site pharmacy to take private insurance for diabetic supplies, according to the release.


The insidiousness of audits has been a plague on all our houses but bidding 72% under the, then, current allowable and then being SHOCKED your having problems making ends meet is more than a little dis-engenuous.

HELLO??!!!  YOU BID  BELOW COST AND OVERHEAD. Medgroup and VGM went around the country warning DME's what would happen if you raced to the bottom to get a contract.  Bid winners around here are begging referrals for non-Medicare business but their service is so bad the referrals are giving the business to us and other suppliers who provide better service.

Let me see........ life without a contract:

no audits in the future (after the contract is up)

no face to face requirements

actually making a profit on what we supply

Not having to lay off any employees

Sleeping at night

Sure miss Medicare ..............NOT!!!

Excessive audits, ALJ appeals backlog, competitive bid, and reimbursement reductions will all have a paradocixal effect.  You can mark my word and take it to the bank.  Whatever money CMS is thinking it is saving with all of these rediculous pushbacks against HME Providers will unltimately result in huge expenditures on the Medicare Part A side.  In fact, I predict there will be a huge upswing in Part A expenditures over the next 3 - 5 years.  Think about this. A patient needing a PMD or complex manual with special seating (pressure prevention) who ends up with a decubitus because they can’t get their chair within a reasonable timeline, could result in excess of $100,000 in costs for hospitalization and wound treatment.   CMS either fails to see the correlation in timely approval of medically needed DME for home treatment or they just don’t care.  As usual, bureaucrats not involved in patient point of treatment contact just don’t get it. Additionally, F2F requirements relative to other HME will delay provision of medically needed equipment that will result in increased hospitalizations.  Healthcare expense that could be minimized through the  timely provision of homecare equipment and services will exponentially increase on the Part A side.  CMS thinks they're saving tens of millions of dollars by restricting access to DME.  Keep a watch on Part A expenditures, they will dramatically increase.  I guarantee it.