We're Not Gonna Take It Anymore

Published in Member Communities on March 18, 2025

By Ronda Buhrmester, Senior Director of Payer Relations, VGM & Associates and Dan Fedor, Director of Reimbursement and Education, U.S. Rehab

Many of you have heard the song by Twisted Sister, “We’re Not Gonna Take It,” and if for some reason you have not, take a few minutes to listen to the song. In the home medical equipment (HME) industry, THIS will be our theme for the year.

We need to stop the madness of continuing to accept these allowables, the unreasonable audits, and going in the red.

Why this song, this theme? Everyone in this HME industry is in it to take care of their customers. Customers who really NEED us. The items provided are not wants but needs. However, most of these items are expected to be paid for by the customer’s health insurance, who has a very different motive than we do. Other than traditional Medicare/Medicaid, health insurance payers are private for profit companies and they act as such with unreasonably low allowables and constant frivolous denials to retain as much money as they can. We need to stop the madness in the industry of continuing to accept these allowables, the unreasonable audits, and going in the red. We are long past due for standing up for our industry AND our business.

In the healthcare space, especially as a DMEPOS supplier, we tend to wear our compassion hat instead of keeping the business hat in place. Because we care so much, we tend to dispense the product or equipment to patients knowing the allowables are not sufficient. We tend to go above and beyond with the products and services we provide knowing the margin for the reimbursement is slim to none. Unfortunately, we all know that this is unsustainable. We cannot be everything to everybody and then complain about the reimbursement.

What can we do? What choices do we have as an industry tied to insurance contracts and CMS requirements for maintaining billing privileges? There are options to consider. A key point to remember is that none of this is set in stone forever.

Allowables have continued to decline as much as 40% over the course of eight years

Non-Assigned Model

You all have heard us educate and discuss the nonassigned model for many years now, especially since the allowables started to decline around 2016 and 2017. The assignment rate for accepting assignment in the data that CMS collects continues to be at 98%. This means as the allowables have continued to decline as much as 40% over the course of eight years, our industry continues to accept the rates and then complain about the rates. The main issue being we do not make any changes to our business model. The viscous cycle continues year over year, rates decline, we accept the allowables, complain, rinse, and repeat.

Let’s stop the cycle and make changes. Change is not hard, that is the easiest part. Not changing is the hard part.

For those that are enrolled as non-participating have the option of submitting a claim non assigned. The supplier sets the usual and customary charge, which includes all the overhead expenses, charges the patient upfront and then submits the claim non-assigned. If there is any reimbursement, the payment will go to the patient directly, which will be 80% of the allowable. If there is a secondary payer, the claim will crossover to the payer for processing.

Does non-assigned mean that it's all or none? The answer is no, there are options.

Does non-assigned mean that it’s all or none? The answer is no, there are options. For example, you can choose all walkers, all full-face CPAP masks, or all hospital beds as non-assigned claims. Or you can choose specific items within the product line. For example, the Cadillac of walkers or a CPAP mask can be non-assigned while the basic mask or walker can be done as an assigned claim.

There are so many options with the non-assigned versus assigned model, which is why this is an area that needs to be part of the discussion for change.

Other Insurance Payers

We know that Medicare allowables tend to set the gold standard for other insurance payers. We also know that the non-assigned model is not an option with other insurance payers because of a contract, unless it’s negotiated in the contract. We often feel stuck, tied to the contract when the terms, the allowables are not sustainable.

What Can Be Done?

When it’s time to negotiate the fee schedule, set the boundaries, and set the expectation of what is needed and why. Do not settle to just have the contract knowing rates are not sustainable; it’s not a good business model. It’s okay to say no and not settle. This actually happens quite often in other healthcare industries, hospitals, clinics, dental offices, etc. They will say no when the rates are not sustainable. Our industry is not any different.

Review the contracts, the terms, and the allowables to determine the payers that are best for the company.

This does not mean to end the terms with all your payers. It means to review the contracts, the terms, and the allowables to determine the payers that are best for the company. Being out of network with a payer is not a bad idea to consider. In most cases, the patient can still get the service from your company, it’s just out of network with no binding contract terms. The supplier can charge the patient the usual and customary charge and submit the claim with the patient knowing it’s out of network.

Another option to consider with the commercial and Medicare Advantage payers is determining which products need to be cash and which products can be submitted for insurance payment. Because the non-assigned model is generally not an option with these payers, this is an option for consideration. Meaning, the Cadillac of walkers, or another product, can be cash only and the basic ones can be submitted to the insurance for payment. If there is a company policy that basically states there needs to be a certain reimbursement threshold to submit to the insurance, then otherwise it’s cash or non-assigned for Medicare. This is just one example, and there are several ways to set a company policy.

Do not let the insurance contracts make you believe there are not any options, do not let them be a bully. The key is having a written policy in place.

Setting Expectations

All too often we take the rights away from the patient, assuming they want insurance to cover the item. We need to ask the patient at the initial encounter, “Who do you expect to pay for this item?” If they state they want to pay out of pocket or with cash, then let them regardless of insurance. The patient has the right to pay cash when they choose. They have the right to waive insurance benefits. Just be sure to disclose all of this in writing upfront to the patient.

Set the expectations of what is needed for documentation and the timeframe for dispensing

If the patient wants the claim submitted to the insurance, then set the expectations of what is needed for documentation and the timeframe for dispensing. Share the difference between the basic product and the Cadillac item, setting the expectation of what the insurance will consider for coverage, such as the basic walker being accepted with the insurance, accepting assignment. Or if the Cadillac is chosen, it’s non-assigned or cash.

We are NOT gonna take it ANYMORE! We’ve got the right to choose as this is our life!

The time has come for the HME industry to stand firm and demand fair treatment from insurance payers. By exploring options like the non-assigned model, negotiating better contracts, and setting clear expectations with patients, we can create a sustainable business model that ensures both the viability of our companies and the well-being of our customers. Let’s embrace the spirit of “We’re Not Gonna Take It” and make the necessary changes to protect our industry and provide the best possible care for those who depend on us. Together, we can make a difference and ensure a brighter future for the HME community.

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This article was originally featured in the VGM Playbook: Forecasting 2025. To read the full article and more like this, download your copy of the playbook today!