The Healthcare Refugee

By Patrick Boardman
J and R Medical

When we hear the word “refugee,” most of us envision a far away, war-torn land. We visualize a city of tents where desperate people have lost everything and have become devoid of hope.

What most people do not realize is that there are refugees in every city and every town in America. These people are "healthcare refugees."

Here in the Houston market, our company has experienced first hand this rising population of people. These are wheelchair users who in good faith purchased a new manual or power wheelchair from a local supplier. That supplier then went out of business and now the patient has nowhere to go for repairs. They lost have their mobility and independence.

Over the last 2 years approximately 20% of the complex rehab providers in Houston have closed their doors. Some got out because their business failed. Others closed because their business model was no longer profitable with complex rehab as one of its divisions.

As a result, thousands of patients suddenly had lost the lifeline of service for their equipment. We were made painfully aware of this situation in late 2007 and early 2008. We noticed a tremendous influx of patients needing service and repairs. The vast majority of the clients had purchased their equipment from a supplier who was no longer in the rehab business. Most of them were distraught and afraid that they would not be able to be independent again.

The Simon Study that came out in 2007 reported that 45% of rehab companies made 5% or less in net profits for the year. It is no wonder that these companies had to draw a line in the sand and say “no.” I do not fault them for making a business decision that kept their doors open.

There are some large national companies in our industry who hope to capitalize on competitive bidding and other continued cuts. They know that their buying power will create an un-level playing field and that their market share could increase. This is classic complex–rehab-out-of-a-box thinking.

Healthcare refugees will only increase under continued cuts and competitive bidding. If someone is lucky enough to win a bid under competitive bidding, they will likely be seeing cuts as deep as 18% or more. If this happens, many companies will simply stop doing Medicare.

This will create an even greater population of health care refugees who will have no one willing to come help them. They will be trapped as prisoners in their beds because their only mobility will be broken with no one to come fix it.

Recently, Texas Medicaid attempted to invoke the same 9.5 % cut that Medicare had done a short time ago. TXRPC, our state complex rehab association, testified at the Medicaid rate hearing to articulate why this was a very bad choice. Such a cut would create a plethora of access-to-care issues for TMHP beneficiaries.

We recently heard from TMHP that the rate cut was not invoked. So for the time being we staved off creating a new population of healthcare refugees. It must be noted that TMHP is one of the few agencies that I have ever encountered that seems to truly take steps to make sincerely good decisions for their beneficiaries. Hats off to Texas Medicaid for listening and doing the right thing for their beneficiaries in Texas.

When the first "Health Care Refugees" started knocking on our door, we made the decision that someone had to help these people. Often we heard the same story: "I have called 4 places, and they all say that if the chair isn't purchased from us then we can't service it."

We decided to do something about the problem. We created a new job within J and R Medical called Service Coordinator. This person schedules technicians and handles all of the paperwork for all clients that have equipment in need of repair. To date we are able to continue to service all clients that have service issues and that are in our geographical service area. It must be noted that we have had to shrink our service area size.

It is imperative that rehab providers, referrals, and patients work together to create a louder voice for our industry. A few days ago President Obama announced that he was going to cut 500 billion from Medicare through eliminating fraud and abuse.

I think everyone will agree that eliminating fraud and abuse is a good thing. The alarming part is that, if this happens, there could be further cuts that create more healthcare refugees.

No one knows what the road ahead holds for these patients and the rehab suppliers. It is imperative that suppliers make an effort to inform their own staff about the challenges we are facing in our industry. Your sales people and ATP’s should be well-versed in the big picture so they can inform patients and referral sources about the challenges we all face. Have your staff hammer your elected officials prior to big votes that affect our industry. Without a coalition and unity, there will be more refugees.

Patrick Boardman

J and R Medical Supply and Rehab
Houston Texas Market