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Home Health & Hospice Week

Competitive Bidding:

CMS PROPOSES BIDDING DELAY -- BUT NOT FOR LONG

Published on Tue Jan 13, 2009

Suppliers give Congress an earful at hearing about the program.

Suppliers may not be getting all they hoped from the directive from the Obama administration to hold all eleventh-hour Bush administration regs.

The Centers for Medicare & Medicaid Services has proposed a delay to the interim final rule reestablishing the durable medical equipment competitive bidding program. In a Jan. 16 Federal Register notice, CMS had set the implementation date for Feb. 17 (see Eli's HCW, Vol. XVIII, No. 4, p. 29).

Now CMS says it is contemplating a delay "in accordance with the White House Chief of Staff's memorandum of January 20, 2009, entitled 'Regulatory Review.'" In that memo, Rahm Emanuel gave the customary order to halt regulations pending review from the new administration (see Eli's HCW, Vol. XVIII, No. 5, p. 40).

But that delay would only be for 60 days,CMS says.

Too short: That wouldn't be nearly enough time to fix all the problems the industry believes are inherent in the bidding structure, critics charge.CMS needs to have a final rule with comments instead of the interim final rule that will basically ensure the industry's comments are ignored, industry representatives say.

And the revised version of the bidding program is nearly identical to the original, with just a few changes required by law, they add. Nearly all of the original program's flaws are intact.

The matter got more attention at a Feb. 11 hearing before the House Committee on Small Business. Reps from the American Association for Homecare, the National Association for Independent Medical Equipment Suppliers, the North Carolina Association for Medical Equipment Services,and the American Association of Orthopaedic Surgeons spoke at a hearing on "The Impact of Competitive Bidding on Small Businesses in the Durable Medical Equipment Community."

"CMS made as few changes as was possible under the law in order to issue a rule quickly on the final day of the previous administration with no structural changes to the flawed program," blasted Georgie Blackburn of Pittsburgh supplier Blackburn's in her prepared testimony. "In rolling out the program in this manner, there has been no opportunity for any public comment or evaluation of the problems that plagued round one throughout 2008."

The bidding Program and Oversight Advisory Committee (POAC), which is being reconstituted,never even met to discuss the problems before CMS reissued a bidding rule, pointed out Blackburn,speaking on behalf of AAHomecare.

"The competitive bidding process, when complete, will eliminate up to 90 percent of these [DME] businesses from the Medicare provider rolls," maintained NAIMES's Wayne Stanfield in his testimony. "Should this happen, it will be devastating to this supplier community, as well as severely limiting access to medical equipment for Medicare beneficiaries."

CMS response: CMS's Laurence Wilson,director of the Chronic Care Policy Group in the Center for Medicare Management, also spoke at the hearing.

"When combined with Medicare's accreditation,licensure, and quality standards efforts, the competitive bidding program will help to assure that high quality service and items continue to be available to beneficiaries who need medical equipment to use at home," Wilson told the committee. "The program will also assist CMS in addressing fraud and abuse issues in the current DMEPOS non-competitive system."

Bidding "can provide value to both patients and Medicare, while ensuring delivery of quality items and services," Wilson maintained. "Medicare beneficiaries ... would have realized, on average, a 26 percent savings on certain commonly used DMEPOS, and small suppliers accounted for 64 percent of the winning bids."

CMS didn't ignore small business needs, he added. The agency "has taken care to design and implement this program in a way that emphasizes the needs of beneficiaries while addressing the concerns of small suppliers."

New tactic: To address CMS's claims that bidding will help deter fraud, AAHomecare is touting a new 13-step anti-fraud plan to curb fraud and abuse in the DME sector. "This action plan ... is a proactive solution that will be far more effective than unnecessary Medicare cuts to the home care medical equipment sector that only harm patients and seniors," says TylerWilson.

The plan includes site inspections for all new suppliers, increased penalties for fraud, and more rigorous quality standards.

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