Reaction: 'The jury is still out on the entire program'

Sunday, March 23, 2008

YARMOUTH, Maine - FedEx drivers on Friday probably had no idea that an entire industry was hanging on their delivery of little purple and orange packages. No sooner had bidders in round one of national competitive bidding
ripped into their future (certified letters from CMS saying whether they'd lost or won the bid), than the buzz began.

"The jury is still out on the entire program," said Walt Gorski, vice president of government affairs for AAHomecare. "We are apprehensive on a number of fronts, whether it's the number of small suppliers, whether it's the bid rate. We are in the first inning of this game."

"Out of the categories we won, we are scrutinizing line by line by line," said Georgie Blackburn, vice president of government relations and legislative affairs for Blackburn's in Tarentum, Pa. "We are doing our charts now and then we'll decide whether or not we participate in each of the categories we won."


Although his company, Miami Lakes, Fla.-based Bayshore Dura Medical won contracts in 8 of the 10 categories it bid on, Raul Lopez, president of the Florida Association of Medical Equipment Services (
"I've heard from quite a few people who claim they supplied information that the CBIC (competitive bidding implementation contractor) is claiming they did not supply," said Raul Lopez, president of the Florida Association of Medical Equipment Services (FAMES). "Also, remember the January issues with bid pricing? (Bidders) entered the rental instead of sale amount. People had already submitted that info back to CBIC. Those were rejected, as well."

That doesn't surprise Gorski, who has also heard of problems with the bidding process.

"Clearly, CMS does not have a stellar track record on being able to ensure they calculated and collected all the info they needed in order to properly evaluate these contracts," he said. "There appear to be basic errors in the process."

Small suppliers
A whopping 64% of contracts were awarded to small suppliers, more than twice CMS's planned set aside. It's too early to say what that means, however, say industry leaders.

"There's no guarantee everyone will sign off on this," said Lopez. "Many may have thrown in their bids and now they've come to the realization they don't know if they can do a (particular) product or service in the metropolitan statistical area."

"It's also a little annoying to listen to CMS use the 64% number as though it represents a huge number of companies," said John Shirvinsky, executive director Pennsylvania Association of Medical Suppliers (PAMS). "In real terms, we're probably only talking about three or four companies per product category (as opposed to one or two at the 30% small business target). The bottom line remains that most providers will be frozen out of the system."

For those small providers that do accept contracts, it will mean a sea change in the way they do business, said Rose Schafhauser, executive director of the Midwest Association for Medical Equipment Services.

"They will have to adapt," she said. "You assume that many have started the ramp-up process, but not too quickly, in case they didn't win."