Medicare: Utilization and Expenditures for Complex Wheelchair Accessories

What GAO Found

The Medicare fee-for-service (FFS) program spends millions of dollars annually to furnish wheelchairs and wheelchair accessories to Medicare beneficiaries. Certain power wheelchairs that are more complex than standard wheelchairs, referred to as complex rehabilitative technology (CRT) power group 3 wheelchairs, and the accessories used with these chairs accounted for a relatively small percentage of total Medicare utilization but a much larger share of total expenditures. These wheelchairs accounted for 2 percent (about 13,000) of all wheelchair utilization and 22 percent (about $69 million) of wheelchair expenditures while accessories used with them accounted for an estimated 18 percent (about 312,000) of all accessory utilization and 51 percent ($159 million) of accessory expenditures. Medicare expenditures on accessories used with CRT power group 3 wheelchairs were concentrated in a small number of accessories. The top accessory--a combination tilt and recline power seating system--accounted for an estimated $56 million, or 35 percent, of total expenditures on accessories used with these chairs. The top 10 accessories accounted for 82 percent of expenditures.

The 2016 Medicare payment rates for some wheelchair accessories have been adjusted by information from the Center for Medicare & Medicaid Services' (CMS) competitive bidding program (CBP). These CBP-adjusted rates are lower than the 2016 fee schedule payment rates Medicare would have paid for the same items had the adjustment not taken effect. However, the magnitude of the difference varied by wheelchair accessory. Among the 10 accessories with the highest estimated expenditures when used with CRT power group 3 wheelchairs, 8 had CBP-adjusted payment rates, and the average CBP-adjusted rates for these ranged from 5 to 17 percent lower than the unadjusted fee schedule payment rates.

Why GAO Did This Study

GAO and the Department of Health and Human Services' Office of Inspector General have reported that Medicare and its beneficiaries have sometimes paid higher-than-market rates for power wheelchairs and other types of durable medical equipment. To achieve savings on these items, Congress required CMS--the agency that oversees the Medicare program--to phase in a CBP for certain items in which suppliers compete in designated bidding areas of the country. This program began in 2008. Certain accessories furnished in connection with CRT power wheelchairs in group 3 or higher were excluded from the CBP by statute. Subsequently, the Patient Protection and Affordable Care Act required CMS to use this competitive bid information to adjust payment rates for non-CBP areas in the rest of the country starting on January 1, 2016. On that date, CMS began to phase in CBP-adjusted payment rates for wheelchair accessories, initially using a 50/50 blended rate for 6 months--that is, a rate midway between the higher unadjusted fee schedule payment rates and the lower CBP-adjusted rates. CMS included accessories used with CRT power group 3 wheelchairs in these payment rate adjustments even though accessories furnished with those wheelchairs were not previously paid at competitive bidding rates. However, the Patient Access and Medicare Protection Act (PAMPA), enacted on December 28, 2015, delayed for 1 year the application of the CBP-adjusted payment rates for accessories furnished in connection with CRT power group 3 wheelchairs.

PAMPA also included a provision that GAO study Medicare utilization and expenditures for wheelchair accessories. This report provides information on 1) the utilization and expenditures for Medicare wheelchairs and accessories, in particular for CRT power group 3 wheelchairs and the accessories used with them; and 2) how the 2016 CBP-adjusted payment rates for accessories, in particular those furnished in connection with CRT power group 3 wheelchairs, compare to the 2016 unadjusted fee schedule payment rates for the same items.

For more information, contact Kathleen M. King at (202) 512-7114 or kingk@gao.gov.