ELYRIA, Ohio--Citing uncertainties about Medicare reimbursement changes, Invacare Corp. said its second-quarter profit dropped 62 percent.

In a statement issued Thursday, the company said it earned $5 million during the second quarter compared with $12.9 million during the same period last year. Net sales dipped 6 percent to $371.7 million from $396.3 million. For the full year, the company said it expects sales to be flat or decline by 2 percent.

"The domestic market remains unsettled due to a number of announced changes to Medicare reimbursement policies, the details of which have not been fully clarified," the company said. "While the underlying demand has not changed, customers have taken a cautious position on purchasing and inventories until details are finalized and published. This has been most disruptive to the power wheelchair and oxygen markets."

North American respiratory product sales dropped 22 percent during the period, the company said, largely due to slower demand for its HomeFill oxygen system line. "In addition to significantly reduced purchases versus last year by national providers, sales to small providers and independents declined 9 percent in the quarter," the company said, noting that uncertainty surrounding the Deficit Reduction Act's oxygen provisions continue to impact the market.

Sales of standard products decreased 5 percent for the quarter, rehab products were down 3 percent and sales of consumer power wheelchairs slipped by 7 percent, also "acutely impacted" by reimbursement issues, the company said.

"While our lack of sales growth continues to be disappointing, it is a reflection of the difficult industry conditions that exist," Invacare Chairman and CEO Mal Mixon said. "Providers tell me they have never seen reimbursement conditions as unsettled and onerous as they are today. Providers are being attacked from all sides with significant reimbursement changes that are still not clearly defined by the government."

To improve performance, Invacare said it will continue to shift substantial resources from product development to manufacturing cost reduction activities, transfer additional manufacturing to China, cut personnel and cost reduce the design and engineering of products. In earlier cost-cutting measures, the company eliminated 450 jobs.

Mixon said he is confident second-half earnings will improve, and "when reimbursement uncertainty is resolved, we will emerge as a better, stronger company."