CMS Suggests Caregivers Run Errands to Cover for Competitive Bidding Service Lapses

One of the critical failings of CMS’ bid-based acquisition program for DME is that it prices only goods, not the services which are an integral part of life-sustaining home medical equipment.

The problems from CMS’s failure to include services as part of the DME they put out for bids started to become apparent at a hearing of the Health Subcommittee of the House Ways and Means Committee.

A member of the Committee, Rep. Gerlach asked a senior CMS official official whether the national mail order competition for diabetes testing supplies could mean that nursing homes may not be able to receive the specific brands of products that the physician prescribed and may be required to settle for products which are not, in the view of the docter, most appropriate.

VGM Asks That You Report Any HME Businesses that Have Closed In and Outside of Round 1 of Competitive Bidding!

From: VGM

At yesterday’s Ways and Means Health Subcommittee hearing, Congressman Pat Tiberi (R-Ohio) asked for a list of HME companies in Round One areas that have gone “out of business.” The industry is compiling the list, and VGM asks that our members help by providing information.

Please send us an email with the names of any companies that you believe may have:

1. Gone out of business in R 1

2. Sold business in R1

3. Gone out of business outside R1

4. Sold business outside R1

(include the town and state in which they were located)

HHS Likely to “Vastly Expand” Medicare Competitive Bidding to Other Health Sectors

WASHINGTON, May 10, 2012 /PRNewswire via COMTEX/ — Medicare’s competitive bidding program for Durable Medical Equipment can easily be applied to in-pharmacy diabetic supplies, laboratory services, prescription drugs and even physicians. Providers of all types of medical equipment, supplies and services should recognize that CMS’s fatally-flawed “competitive” bidding program can and will be applied to their own practice areas.

Secretary Sebelius has already announced that HHS will “vastly expand the use of competitive bidding….” In expanding the program, the Secretary ignored a Congressional Budget Office warning that “If they [HHS] don’t change the mechanism they use, I think there is a high probability of failure in the near future. There is near certainty of failure sometime down the road.”

CMS Is Likely to Expand their Defective Competitive Bidding System to Other Health Sectors

CMS’ competitive bidding program for Durable Medical Equipment (DME) has, as has been explained by over two hundred economists including several Nobel laureates, two fatal flaws:

1. The bids are not binding — people can game the system by bidding low and then raising their price after the lower price was accepted.
2. Since the low-ball bids are not binding, CMS ends up setting DME prices, not bidders – a continuation of fee-for-service under another name.

The health community at large should be concerned about CMS’ covert price manipulation since, in this era of ever-tighter budgets, CMS is likely to expand their “competitive bidding” price-setting program to retail pharmacies for diabetic supplies, pharmaceuticals, diagnostic tests, and physician services.

Chairman Herger Announces Hearing on the Medicare Durable Medical Equipment Competitive Bidding Program

From: Health Subcommittee, House Ways and Means Committee

House Ways and Means Health Subcommittee Chairman Wally Herger (R-CA) today announced that the Subcommittee on Health will hold a hearing to examine the Medicare Durable Medical Equipment, Prosthetics, Orthotics, and Supplies (DMEPOS) competitive bidding program to understand how the program is impacting patients, suppliers, and program expenditures. This hearing will help the Subcommittee assess the Round 1 experience in nine Metropolitan Statistical Areas (MSAs) and the plans for its 2013 expansion into 91 additional MSAs.

House subcommittee sets hearing Wednesday on competitive bidding

From: VGM

 The Health Subcommittee of the House Ways and Means Committee announced last week that it has scheduled a hearing Wednesday into Medicare’s Competitive Bidding Program to gauge its impact on patients, suppliers and program expenditures. The hearing could provide a format for seeking replacement of the controversial program.

 The subcommittee is expected to assess Round 1 of the Competitive Bidding Program, which already has been implemented in nine metropolitan areas, and plans for implementation of Round 2 in 91 additional metropolitan areas. The hearing starts at 9 a.m. in the 1100 Longworth House Office Building.

Retail Pharmacies Fear CMS’ Bidding Plan Could Strip Their Diabetic Supply Business

From: Inside Health Policy

Community pharmacists say CMS’ decision against creating separate bidding programs for diabetic supplies that are sold retail and through the mail indicates that the agency is trying to push those supplies into mail-order because retail pharmacies would lose money selling them at Medicare’s mail-order pay rate. In announcing that medical equipment suppliers would have to bid again in the first round of the competitive bidding program, CMS said retail pharmacies would continue to be excluded from the bidding and instead the agency signaled that it might simply reimburse retail pharmacies at mail-order diabetic supply rates.

NHIA raises concerns about infusion therapy and competitive bidding

From: Home Care Magazine

The National Home Infusion Association (NHIA) has urged the Centers for Medicare & Medicaid Services (CMS) to reconsider its decision to include certain home infusion therapies in the Competitive Bidding Program’s re-compete for Round 1 contracts.

The association pointed out that it is common for infusion patients to need more than one therapy—with some covered by Part B and others covered by Part D. That may force some patients to split providers under competitive bidding, which only covers Part B therapy.