A look at competitive bidding after four months

Thursday, May 5, 2011

WASHINGTON - When CMS implemented competitive bidding four months ago, some HME providers expected to see an upswing in business. For most, though, that hasn't been the case.

Provider Georgie Blackburn won two contracts in the Pittsburgh CBA for enteral nutrition and standard power wheelchairs. She says, overall, that referral-driven revenues are down 4.5% for the year.

"For enteral nutrition, we've been able to capitalize and secure a larger volume of business at skilled nursing homes," said Blackburn, vice president of government relations and legislative affairs for Blackburns. "However, that doesn't equate to profitability."

For standard power wheelchairs, Blackburn has seen no increase in business whatsoever.

Provider Carl Wallman won two contracts in the Miami CBA for oxygen and respiratory devices. He says he has yet to receive a call for oxygen as a result of winning the contract.

"If anything, we've seen a reduction in referrals," said Wallman, president of Galaxy Medical.

As far as respiratory devices go, Wallman's "doing just about the same as we used to do."

Provider Rick Perrotta won a contract in the Charlotte CBA for standard power wheelchairs. He says he hasn't seen an increase in business for wheelchairs, but he has for repairs. He says he's doing about 15 more repairs per month.

Despite that increase, Perrotta, president of Network Medical Supply, says the lower competitive bidding rates require that he do at least twice as many new sales and repairs to make the same amount as he did before the program was implemented. 

"I don't know any mobility provider that's going to make more money this year than last," he said. "We're all working harder to hopefully try to make somewhere near the same as last year."

One provider who has seen a significant increase in business: Chris Rice. His company, Diamond Respiratory Care, won contracts for all but complex rehab (Group 2) in the Riverside CBA, and has seen business double across the board.

"We've gotten significantly busier since the program started," said Rice, director of marketing. "It's an increase in marketing and a decrease in competitors. Also, referral sources tend to want to make one phone call, and, thankfully, we're still able to do that."