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Paul Gammie of Gammie Homecare Speaks Up: Medicare Home Medical Reimbursement Cuts


In December 2015, Medicare announced to all rural providers of Home Medical Equipment in the United States that tremendous reductions of payments would begin on January 1, 2016 for over 80% of the items they have historically paid for. Half of these cutes would begin on 1/1/2016 and the final half would be made as of 7/1/0216. In Hawaii, these cuts will average over 40% for equipment items of what Medicare paid in 2015, with some of the cutes as high as 50%. We do not make a profit of 50% to give back. We make a profit of under 5%. We cannot take a 40%+ cut and continue in business.

These new rates supposedly come from a competitive bid project Medicare did in various cities around the country, but no providers on the outer islands were allowed to participate in the bid “project”. Medicare has announced what the new payment rates will be but refuses to offer any data for examination of how these numbers were arrived at. They do not allow us to negotiate. Gammie Homecare has closely reviewed our costs and expenses and see no way we can provide the services Medicare clients need for the payment rates Medicare is now offering.

We have been forced by Medicare to take drastic action and are disappointed to announce the following:

1) As of 1/1/16, we are unable to accept assignment for most power mobility items (power wheelchairs, electric scooters, etc.) from Medicare.

2) As of 4/1/16, we are unable to accept assignment on any other of the items Medicare has included in this new program (including the repairs of existing equipment). Medicare clients will have to pay for these items, up front.

3) We will do our best to get any payment available from Medicare sent directly to the client, but cannot guarantee this will happen.

4) We will not abandon current Medicare customers and the equipment they have already received from us. However, we will not take on any new Medicare work with these customers or other, new customers.

We do continue to work with various other insurance companies and can provide a list of those companies to you. If you wish, you have the option to switch your coverage to one of these other plans during the open enrollment time frame beginning on October 15, 2016 and ending on December 7, 2016.

If these changes concern you, please contact our congressional delegation in Washington DC and let them know your concerns. You can also view our website at for more information.

We would like to thank all of our customers for their continued support and understanding on this matter and if you have any questions on the subject, please feel free to contact us.