Iowa: Medicaid implements 5% cut

Thursday, December 17, 2009

DES MOINES, Iowa – It’s probably a sign of the times that providers in Iowa say they can’t complain too much about a recent 5% across-the-board cut to Medicaid reimbursement for DME.

“Our state is in such a terrible deficit—the budget is getting cut, jobs are getting cut,” said Julie Weidemann, director of Palmer Home Medical Equipment in West Union, Iowa, and vice president of the Midwest Association of Medical Equipment Services (MAMES). “So, while I don’t like the cut, I’m thankful it wasn’t more.”

The cut went into effect Dec. 1. Medicaid also cut the rental allowance for DME from 150% of purchase price to 100%.

Like Weidemann, provider Wade Hendrickson believes it could have been a lot worse.

“Our Medicaid program didn’t apply Medicare’s 9.5% reimbursement cut on Jan. 1, and it’s not doing competitive bidding or contracting,” said Hendrickson, owner of Hendrickson Healthcare in Rock Rapids, Iowa. “What we’re going through is nothing compared to other states.”

Additionally, Medicaid initially targeted DME for a steeper cut: 10%, according to a recent MAMES bulletin.

Still, Weidemann believes the cut will have an impact, particularly on ostomy, urological and wound care supplies.

“There’s no margin there to begin with,” she said. “We’re still going to do it. We’re part of a nonprofit hospital in a small, rural community. We’ve made an administrative decision that we’re here to provide service to our community. So as long as we don’t lose our shirts, we’re still going to do it.”