New report raises further doubts on bid program

Tuesday, September 20, 2016

WASHINGTON – The Council for Quality Respiratory Care says lawmakers should heed the findings of a new white paper that raises concerns about the roll out of competitive bid rates nationwide.

The “State of Expert Judgment Regarding Medicare’s Competitive Bidding Program for Durable Medical Equipment,” published by The Moran Company, looks at the history and intent of the program, its implementation, the problems that result when bid pricing is used to develop reimbursement amounts for home respiratory care supplies and services, and other DME.

The white paper highlights several “deficiencies” with the program, including: use of non-binding bids; use of the median bid to calculate payment amounts; the use of composite bids, which it says incentivizes bidders to “game the system” by bidding low for some products and high for others.

“Given the problems with the competitive biding program outlined in this report, doubt has been cast on the validity of the pricing information the program has produced,” said The Moran Company. “Applying this information nationwide, to non-competitively bid areas, could lead to unsustainable reimbursement levels.”

The Moran Report underscores the need for legislation to roll back the cuts that took effect July 1, says CQRC Chairman Dan Starck.

“It’s time for Congress to pass this legislation before patient care coordination and care management services are jeopardized,” he said.

The industry has a short window in which to pass a pair of bills that would soften the blow of the bidding program.


Due to these price cuts, we cannot no longer accept assignment on Medicare claims for oxygen, beds wheelchairs etc. All rental or capped rental items.  We have been forced to lay off employees & refuse referrals for Healthspring. Almost everything is on a cash basis, non assigned. All our costs are going up & profit, if there is one,  is unsustainable. We live in a depressed area & people simply do not have access to home medical equipment because they cannot afford to pay & we cannot afford to provide it to them under their insurance because of the lowered allowables.  So, if CMS is saying there is no limited access, that's simply not true.