Shares of San Diego’s ResMed Inc. (NYSE: RMD) have dropped 5 percent in the past two days, based on fears that the government might lower Medicare and Medicaid spending on home health care equipment.
This weekend, Barron’s magazine reported that the Centers for Medicare & Medicaid Services are scrutinizing the price and usage of use-at-home medical equipment like ResMed's continuous positive airway pressure (CPAP) face masks, designed to treat sleep apnea, which has been linked to heart and circulation problems, obesity and diabetes.
Barron’s said the government is weighing proposals to require prior approval for CPAP treatment and to bundle all payments into a fixed monthly fee per patient. The magazine speculated that if those restrictions affect ResMed's profit growth, they could potentially send the share price down by at least 15 percent.
9001 Spectrum Center Blvd.
San Diego, CA 92123