The Deficit Reduction Plan and HME

I received a few phone calls asking me how the Deficit Reduction Plan President Obama recommends would affect our industry. I am not a legal expert, but decided to see how just much I could learn about it. I spent a weekend studying every magazine, newspaper, TV, radio and others to see what I could garner.

It is fascinating that everyone who talks or writes about this DRP has a different interpretation of the proposed legislation. So please draw your own conclusions. The following is only a summary of what I found out. They are the key parts of my thoughts, but there is so much more.

His entire proposal is to reduce the federal deficit by $3 trillion in 10 years. I do not know how much money a trillion dollars makes. My dictionary says it is 1 followed by 12 zeros but in Britain and Germany it is 1 followed by 18 zeros. Look at this in the U.S.: $1,000,000,000,000.00. (Wow!)

The plan as outlined wants to slash $248 billion from Medicare and $72 billion from Medicaid. Then he indicated that of the $248 billion, 90% of that would come from overpayments. (Overpayments?)

The president wants to raise taxes on the rich. I believe $250,000 income annually is the starting point. According to many financial articles there are many loopholes that these “richer” Americans can use to reduce what they report as income.

My comments:

I am sure that President Obama’s figures are correct, but from all the work that I have done on this topic, I feel that at least 40% (or more) of the over-payments come from cheating. Fraud and abuse are the culprits. How many HCPCS codes are raised to receive a higher payment? How many phony and fraudulent companies have been caught? How many are still in business?

There is no mention of raising the age a person become eligible from 65 to at least 67. This should be one of the first changes. I don’t see any negotiation efforts with pharmaceutical manufacturers to lower their prices. The newspapers report how profitable some major pharmaceutical companies are, so why not ask for their “help”. I see no limits placed on the many fraudulent lawsuits that take many dollars out of the system.

It is not fair to place the burden on DME/HME dealers and providers, who are the last step in the program, to bear the brunt of these reductions. How much will the competitive bid save the government? Nothing! It will force too many family and small companies to close. More unemployment, and less taxes collected, just what the country does not need.

All of this will be addressed at Medtrade. There you will find many answers. The Competitive Bid Central has been prepared for this specific purpose. Many of the speakers, AAHomecare, the state associations and other national ones, VGM, MED and the publications will all be at Medtrade. They have information. Please be sure that you, too, are there.