‘Costs are out of control,’ poll respondents say

YARMOUTH, Maine – The majority of respondents to a recent HME Newspoll (92%) are currently making cuts in their businesses due to increasing equipment, labor and other costs. 

A recent survey of 100 providers by the VGM Group showed, for example, that the cost of delivery vehicle per mile in the Rocky Mountain region was $0.84 for companies with more than 50 employees, an increase of 31% since 2021; $1.17 for companies with 11-50 employees, an increase of 180%; and $1.40 for companies with one to 10 employees, an increase of more than 200%. 

“I’ve never seen anything like what is happening in 43 years of business,” wrote Brian Desmarais of Home Care Specialists in Haverhill, Mass. “Costs are out of control and reimbursement is lagging. It will end badly.” 

Of the 8% of respondents who said they are not currently making cuts – “We are lean, no need to cut costs,” wrote one respondent – 80% said they would be making cuts at some point this year. 

The majority of respondents (29%) said they’re making cuts by not taking assignment on low-margin products. 

“We’ve been forced to cease issuing several product lines, where costs exceed reimbursement rates, and to take others non-assigned,” wrote one respondent. “CMS is in neglect of duty by not adjusting rates to reflect today’s market dynamics.” 

Respondents said they’re also making cuts by limiting the number of products they carry (18%) and reducing headcounts (18%). 

“Reduced profitability, reduced sales volume and staffing challenges are making it difficult to support bonus programs to maintain the current team,” wrote one respondent. 

Things have gotten bad enough, a number of respondents said, that payers will have to take notice. 

“One of the large Medicare providers just sent notice to all of our state suppliers notifying us all of a 25% cut in reimbursement at a time when our expenses and overhead are at an all-time high,” wrote David Chestnut of Pennyrile Home Medical in Kentucky. “It just goes to prove insurance companies put no value on our services. Time to say enough is enough and refuse to comply.”