No Delay on Elimination of First-Month Purchase Option

WASHINGTON — Standard power wheelchair providers were dealt a blow last week when Congress passed a bill to delay a double-digit reduction in Medicare physician reimbursement, but did not include a delay of the elimination of the first-month purchase option.

The option is set to be eliminated Jan. 1. Instead of being paid up front for the expensive wheelchairs, the products will be considered rental items and providers will receive payment over 13 months.

Passed Dec. 8 by the Senate and Dec. 9 by the House, the $19-billion Medicare and Medicaid Extenders Act of 2010 would delay a 25 percent cut in physician payments for 2011, giving Congress time to work on a permanent fix for figuring the docs' pay. But mobility advocates, looking to the legislation as a vehicle that could also carry a delay of the purchase option elimination, weren't so lucky.

"It's a major disappointment that the doc fix passed and didn't include the first-month purchase option delay," said Seth Johnson, vice president of government affairs for Exeter, Pa.-based Pride Mobility Products.

Providers have long cautioned elimination of the option would create financial hardships, particularly for smaller suppliers who are caught in the current credit squeeze and can't make the sizeable cash outlay up front that a power wheelchair demands.

"I think all providers are going to take a harder look at what they provide, how they provide it and if they provide it," said Tim Pederson, president and CEO of WestMed Rehab in Rapid City, S.D. "I think utilization will drop because there's a lot of providers who can't get access to proper credit to do what they have been doing. The margins in their business just aren't there for that."

Since May, the industry has been fighting for a year-long delay of the option elimination to allow providers time to obtain additional financing and otherwise prepare for the transition, offering a pay-for through a 1 percent reduction in the CPI update.

"It wouldn't add a penny to the deficit," Johnson said. "At a minimum, it would preserve jobs, and I think you could make the argument that it would help the economy as well."

Although many in Congress supported the delay — Reps. Jim Langevin, D-R.I., and Glenn Thompson, R-Pa., spearheaded a sign-on letter for the delay in September — "we heard that the only additions to the doc fix would be previous Medicare extenders that had been voted on earlier in the year," Johnson said.