Medicare boosts payments to durable medical equipment suppliers in rural areas hurt by competitive bidding process

"Companies that supply medical equipment through Medicare say the program's plans to boost their payments isn't a giveaway, but rather a reflection of the reality that small companies serving remote areas have been crushed by Medicare's competitive bidding system," Bob Herman reports for Axios.

Medicare implemented a competitive bidding program several years ago to control costs. It mostly affected the durable medical equipment (DME) industry, which has a long history of Medicare fraud and questionable billing practices. Durable equipment includes walkers, wheelchairs, oxygen tanks and insulin pumps.

But the program hurt rural DME suppliers, so the Centers for Medicare and Medicaid Services raised payments for DME suppliers in early May to help mitigate those losses. Seniors and taxpayers will foot the bill for an estimated $70 million of the $360 million annual expenditure for the payment raise. "Medigap plans and Medicaid will cover part of those out-of-pocket costs, but "beneficiaries who do not have supplemental insurance or who are not dual eligible will have increased cost-sharing as a result," according to the regulation," Herman reported in an earlier piece.