It's 'full-steam ahead' for Round 2

Thursday, August 25, 2011

BALTIMORE - Any hope that CMS, of its own volition, would revise competitive bidding for Round 2 has gone up in smoke.

The agency, in a press release announcing the affected zip codes and product categories for Round 2, bragged about the success of Round 1, which it says has resulted in 35% less spending, no changes in beneficiary health and few complaints.

"It's disappointing that, even with overwhelming evidence from bidding experts that this is a fundamentally flawed program, CMS is not making any changes," said Walt Gorski, vice president of government affairs for AAHomecare. "There was a general perception that they would address some of these issues."

One of the biggest issues with competitive bidding in its current form, according to bidding experts, including Prof. Peter Cramton, and industry stakeholders: The bids that providers submit are not binding.

A CMS official told Inside Health Policy that the agency didn't have the authority to make the bids binding. Industry stakeholders beg to differ--the secretary of the Department of Health and Human Services has full discretion, they say--but now they know where CMS stands and they will seek to make changes legislatively.

"The silver lining is that it strengthens the case for the industry to get a member of Congress to introduce legislation to, at a minimum, get that change included in the structure of the program," said Seth Johnson, vice president of government affairs for Pride Mobility Products.

These efforts should be well received by lawmakers, who, all along, have believed CMS was listening to industry stakeholders and bidding experts, and considering changes to Round 2.

"Staffers have been under the impression that CMS would do something in a meaningful way," said Cara Bachenheimer, senior vice president of government relations for Invacare. "We've been telling them not to believe it. It's full-steam ahead"

For some, the tone of CMS's announcement makes not only the industry's goal of revising competitive bidding more difficult, but also the ultimate goal of repealing the program nearly impossible.

"The days of hoping this program would go away are over," said Wayne Stanfield, president and CEO of NAIMES.

Still, the industry has introduced numerous bills to repeal competitive bidding over the years, including this year's H.R. 1041, which has 145 co-sponsors, and it isn't about to throw in the towel now, stakeholders say.

"We're going to have to pick up our efforts," said John Gallagher, vice president of government relations for The VGM Group. "We're going to have to pick up the robo-calls, like those in Kansas City, and the push-backs, like those in Iowa. We're going to have to pick up the talk of the impact of this program on jobs."