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California slashes HME budget

California slashes HME budget

SACRAMENTO, Calif. - Gov. Gray Davis signed a new $99.1 billion budget Aug. 2 that relied on a combination of cuts to state programs and borrowing to reduce an eye-popping $38 billion budget deficit. In all, the cuts trimmed the states $140 million DME budget by about $20 million, said Bob Achermann, executive director of the California Association of Medical Product Suppliers (CAMPS). For HME providers, state Medicaid (MediCal) cuts look like this: - California will now pay no more than 80% of the Medicare allowable for listed items. Previously, payment varied:for some items, reimbursement exceeded the Medicare allowable, for others it was less, sometimes it was the same. This will hit oxygen providers hard. Medicaid previously paid $240 a month for home oxygen therapy. It will now pay 80% of $220. - On unlisted DME items, which includes most custom rehab products, Medicaid will now pay 80% of MSRP. It previously paid 100% of MSRP. - Reimbursement for all other products, including medical supplies, are subject to the 5% across-the-board cut.

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