The Opportunity Is Out There

The initial blast of competitive bidding does not affect the manual wheelchair market, but unwanted shrapnel will likely do damage in the form of reduced overall profits. As a result, home medical equipment providers looking to make up shortfalls in other categories may ask manufacturers to lower manual wheelchair prices. The problem is that in many cases, manufacturers have already done that.

Factor in a sputtering economy, and 2010 added up to what Tim Lis, global product development manager for wheelchairs, Invacare, characterized as a "difficult" year for providers.

"It's almost like the perfect storm has hit the industry because everybody was hit by the recession, so cash is an issue for providers," says Lis. "Then you have the cutback in Medicare reimbursement in other categories, so providers are looking to make up their lost margin in still other categories. All of this is hitting at once, and it has made it difficult for everybody."

Markets historically dislike uncertainty, but those in the HME industry may be more used to it than most.

While manual wheelchairs weren't included in Round 1 of the bidding program, the Centers for Medicare and Medicaid Services has the authority to designate whatever products it wishes (with the exception of Group 3 complex rehab power chairs, which have been excluded). Predictions are that manual wheelchairs will be included at some point.

Then there's the coding situation.

After several years of work on a badly needed revision of the manual wheelchair code set, CMS' SADMERC (Statistical Analysis DME Regional Carrier) transitioned to the PDAC (Pricing, Data Analysis and Coding Contractor) in 2008, and so did the coding revamp. Since then, the major coding project seems to be on hold, and no one is sure when it will be completed.

One bright spot for the manual wheelchair sector is the 5 percent reimbursement bump that took effect in 2009 when so many other products were facing a 9.5 percent cut.

Sidebar: Building Manual Wheelchair Sales

Another is the aging population, which remains a prime driver. As in other sectors of the HME market overall, baby boomers who are taking care of their parents — and who themselves may need such products — mean a strong demand for mobility aids will continue.