Bid fight: Stakeholders keep heads down

Friday, May 18, 2012

WASHINGTON – Fresh off a congressional hearing on competitive bidding, industry stakeholders last week seized the momentum by working to build an even stronger case against the program.

At the top of their to-do list: Compiling a list of businesses in Round 1 competitive bidding areas (CBAs) that have closed, per a request by Rep. Pat Tiberi, R-Ohio. Numbers weren't available at press time on Friday afternoon.

"We have received a number of reports from manufacturers who sell HME items to providers, our state leaders and buying groups that highlight the negative effects of competitive bidding," said Walt Gorski, vice president of government affairs for AAHomecare, which is compiling the list.

The hearing took place May 9 before members of the Subcommittee on Health of the House Ways and Means Committee.

Rob Brant, founder of AMEPA, has identified seven contract providers in the Miami CBA that have gone out of business. If you look at the non-contract providers that have closed, "there's a ton," he said.

"There were 400 providers in 2009 before mandatory accreditation and surety bonds went into effect," said Brant, a Round 1 contract winner in the Miami CBA who closed his own company, City Medical, last spring. "After that it dropped to below 200."

Post-hearing, the industry is also condemning several comments made by Laurence Wilson, director of CMS's Chronic Care Policy Group, about the industry's market-pricing program (MPP). Among other things, he said that he believed the proposal would hold providers to their current levels of business, rather than allowing them to increase their business.

"His review or understanding is somewhat limited because the language for MPP isn't out there for formal vetting and review by Medicare," said Seth Johnson, vice president of government affairs for Pride Mobility. "But his statement regarding capacity was completely inaccurate."

Not that the industry expects CMS to embrace MPP, say stakeholders.

"CMS is too far along with Round 2, and they are going to see it through," said Wayne Stanfield, president and CEO of NAIMES. 

Stakeholders expect lawmakers to continue to push CMS for the data its using to gauge the success of competitive bidding.

"CMS has steadfastly refused to provide requested data to Congress," said Cara Bachenheimer. "That's one of those things that irritates people on the Hill. We would love to have access to the data that CMS is using to come to these grand conclusions."


Rob Brant needs to be careful when talking about the number of suppliers that have closed.  He cites a loss of 200 suppliers "<since> mandatory accreditation and surety bonds went into effect."  This could be interpreted as shady or inactive companies which the industry is better off without.  We know CMS likes to spin statistics, so we need to make sure that we are counting the suppliers who, like Brant himself, were driven out by the effects of competitive bidding.

Hi Janet. I think Rob was trying to make that point and that those measures weeded out the undesirables without competitive bidding. Otherwise, he was focused on contract winners that have since closed in his area.

Competitive Bid, together with the Capped Rental idiocy and the disasterous Audit witch hunts have managed to illiminate about 50% of the industry if we are to believe some of the reported statistics.  In anyone's world this is not good for the country.  If it put even one "mom and pop shop" that supplied equipment to beneficiaries it hurt the program. This is a political football and nothing more all in the name of preserving the Medicare dollar.  Common sense would suggest that with the Medicare fee schedule which grossly under reimburses EVERY provider from doctors to suppliers is an equal opportunity discriminator. Whether you choose to go to the Scooter Store or Two Guys will Supply you we both get the same dollar for the same product.  That saves no one.  All competitive bid did was to set up the more affluent suppliers with a monopoly in their area who won the bid.  They are not even required once they win to service the beneficiaries they are designated to service. There are suppliers across the country I talk to telling me that they didn't win the bid for their town and that the Scooter store won't get them in for a wheelchair repair for up to 5-6 months so they come to the non-winner asking for him to repair their chairs and he has to turn it down since he CAN'T get paid in the CBA if it deals with replacement.  I hear from the beneficiaries I have to call back to say I can't provide the equipment for, telling me "I don't want to go to the Scooter Store and that is the closest option!" It makes more sense and levels the playing field to set the price of the equipment and let the beneficiary decide who and where they will purchase from.  One patient told me it is like being told she can only buy her groceries at Vons and she likes her local A&P.  Maybe CMS needs a voucher system to allow beneficiaries to choose where they want to spend their voucher so we don't remove freedom of choice from them!  If we are really trying to cut down on fraud then let the Accreditors monitor the so called irregular billing practices and if they discover fraud, turn it over for an official ZPIC audit.  That would save all the government dollars paying for the lunacy audits they have publically admitted are NOT working.  Maybe CMS should look for real fraud and prosecute if it is really there. Most of us in the industry who have jumped through all of the CMS hoops are legitimate compliant suppliers.  We are not who CMS should be after. Are you listening President Obama?  IT'S NOT WORKING! So STOP!