Pennsylvania HME association unveils competitive bidding study

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02/18/2008

Here's the text of a press release issued today by the Pennsylvania HME association. We'll release some hard facts from the study on national competitive bidding later, but in a nutshell, this report demonstrates once again that NCB "is really just an anti-competitive scheme that is being unleashed on America’s elderly, infirmed and disabled,” says PAMs Executive Director John Shirvinsky.

PITTSBURGH, Pa – A new study was released today by the Pennsylvania Association of Medical Suppliers (PAMS). The study, conducted by Brian O’Roark, PhD and Stephen Foreman, PhD, JD, MPA, showed that the Centers for Medicare and Medicaid Services’ (CMS) so-called “competitive bidding” program threatens Pittsburgh Medicare patients and businesses. This program will begin the process of taking effect in Pittsburgh in March. Speaking at the United Cerebral Palsy of Pittsburgh, the study authors and PAMS Executive Director John Shirvinsky highlighted the program’s potential risks.

Shirvinsky said, “Some of the most seriously ill and disabled Medicare patients in the greater Pittsburgh area are currently targeted as guinea pigs for an ill-considered program that will profoundly affect the manner in which they receive in-home medical equipment, supplies and related services.” The program will impact items such as power wheelchairs, oxygen equipment and supplies, CPAP and BiPAP’s, hospital beds, walkers, mail order diabetes supplies and much more.

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In attendance were some of the 200-plus patients served daily at UCP. Their disabilities include acquired brain injury, mental retardation, spina bifida, spinal cord injury and cerebral palsy. These are exactly the type of people PAMS, the study authors, and people like Congressman Jason Altmire believe will be threatened by CMS’ competitive bidding program.

One Pittsburgh home medical equipment provider who shares these concerns about the program is Georgie Blackburn, Vice President of Blackburn’s Physicians Pharmacy, Inc. in Tarentum. Blackburn is a past PAMS president and Executive Board Member of the American Association for Homecare.

“We’ve built our businesses upon uncompromised service and dedication to our patients,” Blackburn said. “‘Competitive bidding’ reduces this to a commodity and will award those companies able to bid the lowest price with a three-year contract. That is not the small provider. Throngs of small providers will no longer be able to serve Pittsburgh’s Medicare patients who depend upon us. We are deeply concerned about quality, continuity, and timeliness of care for our patients. We are concerned that we may not survive ‘competitive bidding.’”

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O’Roark and Foreman, both economics professors at Robert Morris University, conducted an independent evaluation of the likely economic consequences of Medicare’s proposed “competitive bidding” program for durable medical equipment and supplies (DME). The study labeled CMS’s competitive bidding program as “uncompetitive” and “poor public policy.”

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“The limits on competition that CMS is proposing to implement will have great potential to produce higher prices and lower service quality,” Foreman said. “The franchise bidding process that CMS is implementing is at odds with everything that we know about markets, efficiency and incentives. We should be encouraging added competition in the market, not limiting it. Limits on competition like those proposed by CMS rarely, if ever, make consumers better off.”

“This so-called ‘competitive bidding’ program is really just an anti-competitive scheme that is being unleashed on America’s elderly, infirmed and disabled,” Shirvinsky said.

Shirvinsky outlined the risks to patients and the economy as the loss of patient choice, confusion and inconvenience for patients, dramatic cutbacks in patient service and responsiveness, higher long-term Medicare costs, and the potential for hundreds of small business failures and thousands of job losses. He called upon “CMS to immediately postpone the signing of Round 1 ‘competitive bidding’ contracts that are planned for March of 2008. In light of this new information, Congress deserves the opportunity to review and evaluate the potential negative impacts of “competitive bidding” before the program does harm to individuals, the economy and the Medicare system.”

Congressman Jason Altmire, Chairman of the Small Business Subcommittee on Investigations and Oversight, is opposed to any Medicare reform threatening to unfairly penalize small businesses.

New Jersey Drive movie download In a prepared statement, Altmire said, ““The report released by Robert Morris University today adds to a mounting body of evidence that indicates CMS’ Competitive Bidding Program is a bad deal for small medical equipment suppliers and the patients they serve. I am deeply concerned that CMS is moving ahead with implementing its new competitive bidding program without truly accounting for the toll it could take on our local economy. If hundreds of western Pennsylvania’s small medical equipment suppliers are forced to close, thousands of hard-working people will loose their jobs and countless patients will no longer be able to receive quality, personalized service close to home.”

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PAMS President Robert Brown noted, “this study confirms that ’competitive bidding’ delivers a devastating blow to patient care and choice, as well as costing a lot of hard-working small business owners and employees their livelihood. Congress must repeal the midnight mandate that durable medical equipment and supplies must be purchased by Medicare through the flawed, so-called ‘competitive bidding’ process.” Brown is Vice President of Andrew Brown’s Home Healthcare in Scranton, PA. Scranton has been identified by CMS as one of 70 metropolitan areas to participate in Round 2 of the competitive bidding program later this year.