Medicare advisers raise questions about NCB

Thursday, October 31, 2002

WASHINGTON — An influential panel that advises Congress on issues affecting Medicare has raised a number of concerns about competitive bidding for durable medical equipment.

"Our people were encouraged," said AAHomecare CEO Tom Connaughton. "They said, 'Wait a minute. There are services involved in this stuff. It's complicated. There are all kinds of economic issues."'

The Medicare Payment Advisory Commission (MedPAC) includes 17 members, who bring diverse expertise in the financing and delivery of health services. Many members of Congress, consider MedPAC's annual June report as the Gospel, said Cara Bachenheimer, a healthcare attorney with Epstein Becker & Green in Alexandria, Va.

"They are viewed as one of the few groups on Capitol Hill that provides detailed, objective analysis," Bachenheimer said.

The September meeting was just the opening process in MedPAC's discussion and analysis of competitive bidding, and the board won't issue its final recommendation until June. That's probably a good thing because a MedPAC staffer described DME to board members as "primarily purchasing commodities" and added that "there's very little service component."

And while staffers painted a fairly rosy picture of competitive bidding as a way to save money without sacrificing quality service, a number of comments mirrored and supported industry concerns.

For example:

- Should the product be a bundle of services and goods?

- Will competitive bidding work in rural and large metropolitan areas?

- How will it work for products that require a fair degree of services, such as custom orthotics?

- If a winning bidder is not guaranteed additional volume, why bid?

- Will the savings more than offset the program's administrative costs?

Board members will most likely answer those questions in its June report.

Because of the MedPAC's influence, "It's a voice you are nervous about," Connaughton said. "You don't want to have them say the wrong thing. We need to do a lot of education of those members when things cool down." HME