Competitive bidding: Watchdog group tells CMS to play fair

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07/17/2009

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There's nothing I love more than common sense. So when I saw this piece of news, a little knot of frustration began to tighten in my gut, and I said to myself: "When is CMS going to get it that the way they've designed competitive bidding for DME is just plain wrong?"

Here's a boiled down version of the news that I wrote, but if you want more (including comments), go to the CRE Web page 21 Grams

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WASHINGTON – The HME industry is not alone in believing that CMS’s competitive bidding program for DMEPOS is bad for small businesses.

In a July 14 letter to Jeffery Zients, the director of the Office of Management and Budget (OMB), Jim Tozzi, board member for the Center of Regulatory Effectiveness (CRE), a watchdog group, wrote that competitive bidding should be used “to set prices but not to determine which companies are eligible to participate at the competitively determined price.”

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In his letter, Tozzi points out that CMS is developing a competitive bidding system for Medicare Advantage plans that would do just that: set prices but not exclude companies.

The goal of competitive bidding, Tozzi writes, should be to “protect small business while still achieving the cost savings.”

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“Within the part of CMS responsible for durable medical equipment, competitive bidding is being used to exclude all but a relative handful of winning companies from the Medicare market,” Tozzi writes. “We think this inconsistency must be resolved.”

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Tozzi also sent a copy of his letter to Charlene Frizzera, CMS’s acting administrator.

I wonder, will  CMS ever see the light?

— Mike Moran