Small HME Businesses Searching for Ways to Stay Profitable
As HME providers already know, business is tough and will only be getting tougher as Medicare reimbursement cuts take effect. Small HME businesses are already feeling the pinch and are struggling with what to do next. Do you have a plan to keep your business going?
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For small HME businesses, the reduced reimbursement rates are no longer enough to cover costs. For example, a locally-owned HME provider with six locations in Maine used to receive around $40 to provide portable oxygen to a patient, but now is being reimbursed only $18. (1) The company, Coastal Med Tech, has been delivering around the state for nearly 30 years but now isn’t sure what to do because that $18 is supposed to cover the cost of delivery as well.
Coastal Med Tech as well as other suppliers are considering cutting back their delivery areas or requiring patients to pick up supplies. Other HME providers are wondering if they should stop selling certain items and focus only on the few items they can continue to provide profitably. Of course, raising their prices and shifting some of the burden to Medicare beneficiaries is an option, but that could affect referrals, so suppliers are often reluctant to take that step.
If HME providers don’t figure out solutions to keep costs low and still make a profit, they’ll have to resort to drastic measures. If you haven’t already, it’s time to start planning how to stay in business for years to come. See how CareTend can streamline your operations to reduce costs and grow your bottom line!