Stakeholders Label OIG Report On PWC Prices Ridiculous

WASHINGTON

Medicare could save millions on power wheelchairs if the government reimbursed them at the rates available to consumers on the Internet, according to a report from the Department of Health and Human Services Office of Inspector General.

Released in October, the report found that Medicare payments for PWCs were 45 percent higher than median Internet prices for the equipment.

For the first three months of 2007, the report said, the government could have saved nearly $40 million if its fees had been the same as those Internet prices, and beneficiaries could have saved $233 in copays for the products.

But the OIG report drew immediate fire from HME industry stakeholders.

“The whole report is quite ridiculous,” said Tim Pederson, CEO of WestMed Rehab in Rapid City, S.D., and chair of the Rehab and Assistive Technology Council for the American Association for Homecare, adding that the report is “not an apples-to-apples comparison.”

“CMS’ potential for additional savings is completely overstated by the OIG,” Pederson said. “It has already been established that the provision of PMDs to Medicare beneficiaries is far more expensive than cash sales to ‘drop ship’ customers.”

Pride Mobility Products’ Seth Johnson also termed the report “ridiculous.” Vice president of government relations for the Exeter, Pa.-based manufacturer, Johnson said “the comparison is not even apples to oranges. It’s completely different. It’s more like apples to bicycles or apples to automobiles.

“A consumer buying through the Internet pays cash and walks away with a power chair,” he continued. “An online retailer doesn’t have to comply with Medicare standards. There is no requirement for a face-to-face exam, no evaluation, no fitting or customization that goes into providing power wheelchairs for Medicare beneficiaries.”

Of 28 codes for which it collected information, the OIG found median Internet prices were less than the Medicare fee schedule amounts for 24.

The report also found that Medicare’s payment amount for K0823, the most frequently reimbursed code, exceeded the median Internet price by 36 percent, accounting for 68 percent of the total possible savings to the program.

Johnson said AAHomecare’s RATC would meet with the OIG “just to educate them on the vast differences between the online retailer model and the Medicare provider model.”

Concluded Pederson, “The only way CMS can use Internet pricing as a basis for reimbursement is to abolish the documentation requirements that providers must follow.

“If providers could bill CMS in advance with only a prescription and drop ship to patients after payment is received, then Internet pricing is a fair comparison. We all know that this is not going to happen. The OIG needs to come back to the real world.”