Medicare cuts hurt home medical equipment providers

Published 12:10 am Monday, September 26, 2016

By Amanda Raymond

SALISBURY — Cuts in Medicare reimbursements are causing problems for home medical equipment providers and the seniors with disabilities or chronic conditions who depend on that equipment the most.

“Any business like mine that depends on Medicare … can’t survive. The cuts are that brutal,” Craig Rae, owner of Penrod Medical Equipment at 1806 W. Innes St., said.

Medicare provides medical equipment providers like Penrod with contracts through a competitive bidding process. According to the advocacy group People for Quality Care, the process was put in place to lower costs and decrease cases of fraud, but it has ended up negatively affecting providers.

As of July 1, Medicare has cut funding for home medical equipment for rural areas from around 50 percent to up to 80 percent for different items, according to the Centers for Medicare and Medicaid Services.

The reimbursements are not enough to cover the cost of the equipment, delivery expenses and the time and labor it takes to fill out all the paperwork, Rae said.

And the difference between the cost of the equipment and Medicare’s reimbursement falls on the patient.

There are providers who cannot afford to deliver equipment to patients. Others are not awarded contracts or decide to no longer accept Medicare patients.

“Right now, more and more seniors are having trouble getting medical equipment,” Rae said.

Rae said he recently had a patient call about getting a walker with wheels. She said she called multiple places but no one could afford to help her.

Rae told her he could sell it to her, but he couldn’t afford to deliver it. The patient had no way to get to the store.

People for Quality Care collected stories from around the country to show how the Medicare cuts are affecting patients and providers.

Rita Thomas, from Alabama, depends on Medicare to provide CPAP supplies to treat her sleep apnea. Thomas said she has not been able to get her supplies since August because she cannot afford to pay the difference between what Medicare covers and the cost of the CPAP supplies.

“I am very concerned about paying up front for my equipment,” she said in a news release. “My husband and I live on a limited budget, and having the money to do so is not an option.”

In addition to having negative effects on patients and home medical equipment providers, case managers and discharge planners are also feeling the effects.

Kristie L., a physical therapist and case manager from Massachusetts, said she was having a hard time finding home medical providers that will supply equipment through Medicare.

“With Medicare rate cuts and competitive bidding, I am really struggling to find equipment for my patients,” she said in a news release. “I have gone through all my regular channels, and no one is servicing Medicare patients anymore.”

Along with cuts in reimbursements, Rae said providers have to make sure the paperwork is filled out perfectly or the claim can be audited, which further delays the equipment getting to the patient.

Rae said he has had to find other sources of revenue instead of depending on Medicare items. Penrod has a contract with the Hefner VA Medical Center and provides more items in the showroom that are not covered by Medicare.

He said he will still take Medicare patients and bid on contracts because he knows the way the system is operating now cannot last much longer.

“Something’s got to change or there’s not going to be any (providers) around,” he said.

People for Quality Care and Rae encourage people to voice their concerns to Congress before the session ends at the end of September. To learn more and send a letter to Congress, visit

Contact reporter Amanda Raymond at 704-797-4222.