NewsPoll: Are bid contracts ‘worth it’?

Friday, April 15, 2016

YARMOUTH, Maine – Respondents to a recent HME NewsPoll are split over whether accepting a competitive bidding contract from Medicare is a good idea.

Fifty-four percent of respondents said that, in general, they did not accept the majority of the contracts they were offered, while 32% said they accepted a contract the first time around, but not the second.

One reason: “(It’s) not worth it,” said Jill Duda, business operations manager at Philadelphia-based Flagship Medical, of the decrease in reimbursement rates and the increase in paperwork.

Another respondent, who only accepted one of six contracts (for enteral) during Round 2, said the threat of damaging their reputation of providing quality products and service far outweighed the threat of losing business.

Others say business is doing just fine without contracts—in some cases, better.

David Beshoar, president of MedServ Equipment based inPalatine, Ill., was awarded contracts for Round 2, but did not accept any due to low reimbursement, nor did he submit bids for the Round 2 re-compete.

“In spite of not being able to bill Medicare for the last two-and-a-half years, our revenue and profits continue to increase,” he said.

Meanwhile, some providers felt they had to accept the contracts to survive.

“I hate to say (it), but we have no choice, even if it means these patients are going to get less care than ever,” wrote another.

One health system-owned HME company said it accepted Round 2 re-compete contracts so it can provide better care. It failed to receive contracts for Round 2, resulting in late discharges, longer lengths of stay and an increased chance of readmissions.

“The Round 2 re-compete allowed us to bid aggressively to be able to support the continuum of care throughout our community and ensure timely, fluid and safe discharges from all campuses,” the respondent said. “While the margins are thin, the outcomes will counter the risk associated with fragmented providers.”

Thin as they are, those who accepted contracts say they’re committed to making it work.

“We will look into getting price concessions from vendors; scale down our workforce; deliver less; and seek operational efficiencies,” said another respondent. “We will also look to continue focusing our business on non-Medicare patients and non-competitive bid items.”