A plan outlined in President Obama’s 2015 budget that would apply competitive bidding payments to Medicaid reimbursement could have a much larger impact on Medicaid rates than anticipated.
“States have experienced challenges in preventing overpayments for durable medical equipment (DME),” the President’s budget reads. “Starting in 2015, the Budget would limit Federal reimbursement for a State’s Medicaid spending on certain DME services to what Medicare would have paid in the same State for the same services.”
By mirroring Medicare reimbursement rates, the budget hopes to save nearly $1.1 billion over the next 10 years.
However, American Association for Homecare President Tom Ryan recently pointed out in a public statement that in many states the Medicaid rates are already lower than the rates under the Medicare bidding program. And, certain state laws allow Medicaid to pay only 80 percent of the Medicare rate for items and services, while other states waive the 20 percent beneficiary co-payment because many Medicaid patients can’t afford it.
“Some states combine both of these provisions,” Ryan said. “Therefore, if the Obama administration’s proposal was enacted by Congress, many state Medicaid payment rates would be up to 40 percent below the already low rates established by the Medicare bidding program.”
Moreover, there is substantial evidence showing seniors and people living with disabilities are suffering because of the bidding program. The patient advocacy organization People for Quality Care has tracked complaints from several thousand Medicare beneficiaries who either cannot obtain the home medical equipment they need or can’t have their existing equipment repaired. And, of course, the diminished access to those services is in part because providers have either shut down or can no longer service those patients.
“The program is dismantling the DME infrastructure that seniors and people living with disabilities rely upon,” Ryan added. “It has forced bankruptcies and business closures, leaving beneficiaries adrift to find businesses that can provide the home medical equipment prescribed by their physicians. It has also been challenging for many patients to find a provider to repair or replace their life-sustaining medical equipment.”