CMS: DME Bidding — It’s Not An Auction

CMS finally admitted today what DME suppliers and independent experts have long known, the agency’s bidding system for home medical equipment “is not an auction.”  The admission was made by Laurence Wilson, Director of CMS’ Chronic Care Policy Group in response to a question at a hearing by the House Small Business Committee’s Subcommittee on Healthcare and Technology, Medicare’s Durable Medical Equipment Competitive Bidding Program: How are Small Suppliers Faring?

In response, Dr. Peter Cramton of the University of Maryland who also testified at the hearing, noted that the term “competitive bidding” is synonymous with auction and that, because the law requires CMS to conduct competitive bidding, the agency is not in compliance with the law.

The Center for Regulatory Effectiveness made a similar point in comments to the White House Office of Management and Budget (OMB) on a request by CMS to renew their authorization to use the Request for Bid forms.  CRE informed OMB that the agency’s Information Collection Request “does not meet the Paperwork Reduction Act’s practical utility requirements since it does not meet the MMA’s goal of obtaining home medical equipment and services at the MMA’s goal of obtaining home medical equipment and services at competitive prices.”

CRE’s comments to OMB are available here.

The House Small Business Committee’s notice of the hearing, including witness statements, is available here.