Competitive bidding: Providers stare down familiar foe

Sunday, September 13, 2009

YARMOUTH, Maine - HME providers this month described preparing to submit bids for Round 1.2 of national competitive bidding as "a necessary evil."

"We're not thrilled about it, but because we service a large Medicare population, we don't have much of a choice," said Raul Lopez, director of operations for BayShore Dura Medical in Miami Lakes, Fla., part of the Miami competitive bidding area (CBA). "These are patients that we've had for years."

On Oct. 21, bidding begins for nine product categories in nine CBAs.

BayShore Dura Medical, which relies on Medicare for 40% of its business, plans to submit bids for all categories, except complex rehab (Group 2) and mail-order diabetic supplies, in Miami and Orlando, Fla. That's pretty much what it did last year.

Provider Tom Mullaney has no plans to reinvent the wheel, either. He plans to submit bids for the same categories, including oxygen, CPAP devices, standard and complex wheelchairs, and hospital beds.

"We won all of them," said Mullaney, president of Mullaney Medical in Cincinnati. "Still, it would be nice if they scrapped the program--but only if they do it before the program starts. Last year, it was a waste of time and money."

Competitive bidding was in effect for about one week last year, before Congress delayed the program for 18 to 24 months.

Provider Edward Eubanks and six others plan to take another crack at bidding for oxygen and CPAP devices in Charlotte, N.C., as part of a network, something they did successfully last year.

"It won't be easy and it won't be inexpensive," said Eubanks, one of the owners of Charlotte Respiratory Solutions in Charlotte, N.C.

Other providers plan to change their strategy somewhat. Chair & Equipment Rentals & Sales in Charlotte, N.C., plans to bid on standard and complex rehab, like it did last year, but also oxygen.

"It's a possibility," said Will Dolan, managing director. "It would be a new business line for us, but we feel it's safer to broaden out. If we don't bid, we're absolutely not doing business with Medicare. If we do bid and win, at least we have the option of turning it down."

Provider Steve Nelson plans to bid for the first time.

"We didn't feel like we could bid properly last year because of the questions surrounding the program, the short timeline and the lack of guidance, especially for mom-and-pop providers," said Nelson, president and CEO of Okeechobee Discount Drugs in Okeechobee, Fla., part of the Orlando, Fla., competitive bidding area.

After seeking advice from other providers and industry consultants like Miriam Lieber, Nelson feels more confident this year.

"We're going to bid on everything--plain and simple," he said. "I want to have the same ability to service patients, just like the big boys. I don't feel one provider can do it all."