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Layoffs And Business Closures Caused By Medicare Bidding Program Will Harm Patients Says AAHomecare
Date:2/27/2013

rce of funding, these beneficiaries will have no resource for the prescribed equipment that is needed."

Hawkins laments the decision to stop serving Medicare patients, but says he has no choice.

"The reduced rates do not allow for delivery time and expense to our rural customers," he says. "It will have an extremely detrimental effect on beneficiary access to homecare products, as there are limited/no companies that service these rural counties. Our employees are aware of probable employment termination as our workload shifts away from Medicare funded services."

In Birmingham, Ala., Mike Cobb , owner of Crest Medical for more than 30 years, says the price cuts will also force him to lay off workers, a move that will impact their service to customers.

"My wife and I own a small, independent DME company in the Birmingham-Hoover competitive bidding area," Cobb says. "For fiscal year 2012, and for years back beyond that, we felt fortunate if our profit margins for the year were at 5% or better, and we run a very cost efficient business model, with my wife and I on the very front lines of customer service and patient care because we can't afford to add staff. Including the two of us, we have a total staff of 11, with seven being full-time and four part-time."

He says the 45% cut in Medicare, Medicare Advantage, and other insurance payors that use the Medicare allowable basis for reimbursement will reduce his annual receivables by about 30% whether they accept bidding contracts or not. "In order for us have a chance at remaining viable, we will be forced to lay off all part-time and at least two full-time employees," Cobb says. "The good service reputation that we now pride ourselves on will be gone."

It should be a clear sign to Congress and CMS when companies that "win" bidding opportunities actually turn down the c
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SOURCE American Association for Homecare
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