The rules for getting medical equipment through Medicare have changed quite a bit over the last few years.  Not too long ago, Medicare paid its providers of medical equipment, provided to Medicare beneficiaries or policyholders, a FAIR allowable to obtain medical equipment.  In other words, the fee schedule paid by Medicare was enough to make a decent profit for medical equipment providers and they could ‘accept assignment’.  

Accept Assignment?  Not sure what this means?  When a medical equipment provider files a claim to Medicare, they have the option of sending claims in one of two ways; assigned (accept assignment) or non-assigned (not accept assignment).  When a provider accepts assignment, they agree to accept what the Medicare fee schedule is for an item, file the claim assigned, and Medicare pays the provider direct.  For example, if someone needed a walker, Medicare used to allow $82.37. At this fee schedule amount, the medical equipment provider could accept assignment on this amount and Medicare would pay 80% of this amount ($65.90) to the provider in 14 to 18 business days. The other 20% would be paid by a secondary policy or the Medicare beneficiary. The $82.37 allowed by Medicare was a FAIR dollar amount and still allowed the provider to make a decent profit.   

On July 1^st, 2016, the fee schedule amount for a walker was reduced to $47.16, an approximate 40% reduction in the fee schedule. What this means to Medicare beneficiaries is that they will have to pay more out of pocket. Medical equipment providers will have to file their claims on a ‘non-assigned' basis to Medicare and Medicare beneficiaries will have to pay for their medical equipment upfront. Medicare will then reimburse the beneficiary their amount, which is 80% of the Medicare fee schedule or $37.73 in this example.  The 20% Medicare does not pay on their allowed amount and any amount over the Medicare fee schedule is the Medicare beneficiaries responsibility. For example, if the medical equipment provider charges $84.95 for a walker, Medicare will pay $37.73 and the balance of $47.22 would be owed by the Medicare beneficiary or some or all of this would be covered by a secondary insurance policy. Hopefully the Medicare beneficiary has planned well and bought a decent Medicare Supplement Insurance Policy.  

The medical equipment providers are being forced to file all claims on a non-assigned basis because they cannot take a 40% ‘pay cut’, over night, on the equipment they provide. So when you are asked to pay for your medical equipment upfront, this is the reason why. Who can take a 40% pay cut over night and continue to pay their business expenses?

If you have any questions about how claims are filed to Medicare, Lincoln Mobility has a well trained staff to assist you and a licensed insurance professional on staff.  Whether you need a lift chair, walker, scooter or any other type of medical equipment, call Lincoln Mobility and they can let you know what Medicare’s requirements are and what they will pay towards the equipment you are needing. Lincoln Mobility can be reached at 402-421-8800, and they are located at 2655 S. 70^th St. in Lincoln. They are also online at www.LincolnMobility.com.