Medicaid cuts add up

‘We will not be able to continue providing recipients with equipment,’ said one poll respondent
Friday, June 19, 2015

YARMOUTH, Maine – A whopping 70% of respondents to a recent HME Newspoll said their state Medicaid programs have reduced reimbursement in the past year.

Respondents say these reductions are making it difficult to service patients, if it all.

“This new cut means that, in many cases, we will not be able to continue providing recipients with the equipment/supplies that they need,” said Jeff Burkett, DME Manager at Mount Vernon, Ill.-based TMS Mobility & Rehab, which saw a 16.75% cut in Medicaid reimbursement rates in May*.

Of those respondents who reported a reduction in reimbursement, the majority (50%) have seen reductions of 15% or more.

Some states, like Rhode Island, have taken the extra step of reducing rates retroactively.

“It’s truly an unfair practice,” said one respondent. “Providers perform with the expectation of a specific allowed amount, and then subsequently learn that the fee will be adjusted after the fact.”  

Of the 30% of respondents who reported no recent reductions in Medicaid reimbursement, 67% said their state Medicaid program is considering a reduction.

Another looming possibility: a provision included in the 21st Century Cures Act that would limit the federal portion of state Medicaid fee-for-service rates for HME to the Medicare competitive bidding rates.

Even without reductions, some respondents say they’re struggling to break even.

“Our state hasn't raised reimbursement rates in more than eight years for DMEPOS, putting it far lower than Medicare rates,” said one respondent. “Our new governor wants to do a massive expansion of more enrollees, but there is no plan to raise reimbursement rates to prevent us from losing money on each patient we see.”

The states that are reducing Medicaid reimbursement are being shortsighted, respondents say.

“Colorado Medicaid has given us an increase in the last two years,” said the respondent. “We had major cuts a few years back and they are trying to make up for those cuts with surplus money they have in the budget.”