Round 1 2017: No lessons learned

Friday, April 24, 2015

BALTIMORE – Despite widespread concerns and a new law that will eventually require modifications to the program, the next phase of competitive bidding mostly mirrors the recently completed Round 2 re-compete.

“CMS doesn’t seem to be making any modifications to improve the program,” said Cara Bachenheimer, senior vice president of government relations for Invacare. “Over the last two years they’ve been telling Congress, ‘Oh, we’ve been making improvements; we’re flexible and we’re responsive.’ We are not seeing that actually happening.”

CMS on April 21 announced initial plans for Round 1 2017, with bidding expected to open sometime this fall. Of the eight product categories providers will submit bids for, seven were included in the Round 2 re-compete. The eighth, non-invasive ventilators, is new and is likely a reaction to a recent spike in billing for the vents, which cost Medicare about $1,500 per month, say stakeholders. Vents will only be bid in eight of the 13 competitive bid areas.

Also like the Round 2 re-compete, CMS is still grouping certain products together—like CPAP and oxygen—in ways that don’t reflect how they are actually provided.

“In their own analyses of data from the National Suppliers Clearinghouse, they know the percentage of those who do one or the other, so to keep bundling them together is concerning,” said Kim Brummett, senior director of regulatory affairs for AAHomecare. “It will be interesting to see what people bid (in the Round 2 re-compete) or if they even bid at all.”

The original nine CBAs have been split into 13 so that no area crosses state lines, in response to licensure issues that cropped up in earlier rounds of bidding.

CMS’s roll out of Round 1 2017 comes less than a week after President Obama signed a “doc fix” bill that includes provisions requiring providers to be licensed and to obtain bid bonds as part of competitive bidding. CMS must apply the changes to the next Round 2, but stakeholders would like to see that timeframe pushed up.

“I think what we’ve got to do is continue to push to make sure our champions are pushing for an earlier date,” said John Gallagher, vice president of government relations for The VGM Group.

At the end of the day, stakeholders say, they are fairly confident that providers will bid sensibly.

“We have to believe that people have gotten smarter,” said Brummett. “Low-balling the bidding in areas you don’t even service—it’s a waste of time and it hurts everybody.”