CMS extends competitive bidding program despite protests

From: Health Care Finance

Betsy Caron, Contributing Writer

WASHINGTON – The Centers for Medicare and Medicaid Services (CMS) continue to ignore protests and a proposed bill seeking to eliminate their competitive bidding program for durable medical equipment as they plan for a major expansion of the program with Round Two.

The competitive bidding program uses competitions between suppliers to set new, lower payment rates for certain medical equipment and supplies such as oxygen equipment, walkers and some types of power wheelchairs.

Since the program’s implementation in January 2011, Medicare patients, economists, case managers and members of Congress have gone on record opposing the system, according to America Association for Homecare.

“There’s a reason why more than 30 patient advocacy groups, 244 economists and auction experts, and 145 members of Congress oppose this program; it undermines quality of care and it increases costs,” said Tyler J. Wilson, president of the AAH in a statement issued in August. “Because of this bidding program, beneficiaries will spend more time in expensive institutions rather than in the far more cost-effective setting for care – their own homes.”

Problems reported by Medicare patients, providers and case managers through the AAH’s biddingfeedback.com website include difficulty finding a local equipment or service provider; delays in obtaining medically-required equipment and services; longer-than-necessary hospital stays due to confusion in discharging patients to home-based care; few choices for patients when selecting equipment or providers; reduced quality; and confusing or incorrect information provided by Medicare.

In March, two Pennsylvania congressmen, Glenn Thompson (R-Pa.) and Jason Altmire (D-Pa.), introduced a bill seeking to eliminate the bidding program. Committees are still reviewing the deficit-neutral bill.

“Medicare beneficiaries are entitled to high-quality, low-cost medical equipment and we intend to deliver on this promise by reforming the current bidding program,” Thompson said in a statement.

The bidding program’s first phase was implemented for nine product categories in nine areas of the country at the beginning of 2011. As required by law, CMS will conduct the second phase of the program for a similar set of products in 91 major metropolitan areas. Competition begins this fall, and the new prices will be in effect on July 1, 2013.

“We’re taking steps that will save Medicare, seniors and taxpayers $28 billion over 10 years,” said CMS administrator Donald M. Berwick, MD, in a statement. “Medicare is paying much more than the private sector for equipment like wheelchairs and walkers. By expanding our successful competitive bidding program, we can ensure that Medicare pays a fair rate for these goods.”

Many policy-makers believed CMS would make changes to Round Two of bidding in response to the abundance of negative feedback, but no changes have been made.

“Competitive bidding is an utter disaster, yet Medicare says there are no reported problems,” said Sean Schwinghammer, executive director of the Florida Alliance of Home Care Services, in a statement. “Congress must take action and repeal this program before the situation becomes even more dire.”