Big vs. small


This week, when I was calling providers to ask them about the elimination of the first-month purchase option for standard power wheelchairs, one provider’s comments caught me off guard.

The provider wishes to remain anonymous and you’ll see why.

“Technically, I’m not going to make a lot of noise about this,” he said. “We’re finding that the companies doing TV ads are really starting to grow and do more products in our area, and if this provision puts a monkey wrench in their business, I’ll stand up and applaud it.”

Applaud the elimination of the purchase option?

“We don’t like it, but we’ll deal with it,” he said.

That got me to thinking: Who will feel the most pain from this provision—smaller providers, like this anonymous provider, or larger providers, like the ones who are more likely to advertise on TV?

It turns out it’s not an easy question to answer. Providers, themselves, are divided.
Some say smaller providers will feel the most pain. To stay afloat between the time they purchase wheelchairs to the time they get fully reimbursed for them, providers will need financing. Without strong profit margins and a lot of equity—two categories where smaller providers often fall short—that’s hard to get, especially in today’s credit market.

Consider this scenario: “Let’s say a company does only 10 wheelchairs a month and let’s say the price on those chairs is $3,500 a piece,” a provider told me. “As a purchase, you’re going to collect $35,000. As a rental, in your first month, you’re going to collect something like $350 times 10 chairs or $3,500. That’s a gaping whole of $31,500.”

“Can smaller providers lay their hands on that kind of money?” the provider asked. “Even if manufacturers help out with terms, I don’t think some smaller companies will be able to do it.”

However, some say larger providers will feel just as much pain.

“It’s going to create cash-flow issues, regardless of the size of the company,” a large provider told me. “We’ve talked to people who have said, ‘You’re going to benefit from this.’ We tell them, ‘Look, we’re no different than the company with five employees. We’re big, but our cash flow isn’t necessarily guaranteed.’ There’s going to be some impact in the short-term. We feel confident about the long term, but we have to be able to get there first.”

For now, maybe the anonymous provider should applaud, but from a seated position.

Liz Beaulieu


In the end, this will hurt every supplier. We're expected to finance CPAP's, manual wheelchairs, O2 and a host of other products at little to no margin. Credit limits are already stretched for most small suppliers and this would only make things tougher. This article really drives home the need to get our industry groups out there on our behalf. We all need to get personally involved and send a message to our representatives.

I work for a small supplier who gets regular calls from theseTV ad companies to go set up power wheelchairs in patients homes for them. Sadly, most of these people don't qualify by my interpretation of the Medicare LCD, wheelchairs they have dropped shipped most never fits inside the patient's interior doors, and their documentation is very lacking. I don't know how these companies passed accrediation nor been audited by Medicare. I do forward my own patients that if you get a power chair from your local company, we service it. However, if you all the 1-800 number flashing on your TV screen you'll probably never get any service.