CMS signals potential big changes to bid program

WASHINGTON – Industry stakeholders await more details, but their initial analysis of CMS’s proposed rule for a new round of competitive bidding has them worried the agency plans to significantly expand the program to new product categories and impose new requirements. 

Are CGMs a hot-ticket item? 

In the June 30 announcement, CMS said product categories and a specific timeframe for the next round will be announced at a future date. Yet the agency highlighted continuous glucose monitors (CGMs), saying it would like to reclassify the devices under the frequent and substantial servicing payment category and include them as part of a new Remote Item Delivery (RID) CBP. 

Why the proposed change? Policymakers are likely looking at utilization numbers on a spreadsheet without considering the bigger picture, says Ike Isaacson, senior vice president of government and regulatory relations for VGM & Associates. 

“They think, ‘Oh my, all of a sudden CGMs are a hot-ticket item,’” he said. “Well, that’s because they’re effective. If the administration wants to make America healthy again, those are the kinds of things it should be (spending money on).” 

How would reimbursement change? 

CMS proposes to base bids for CGMs upon a monthly capped program rental that would include the device and all the replacements of supplies. But with the low bid limit the agency is proposing, reimbursement would come down to about $4.77 a month, says Cara Bachenheimer, head of the Government Affairs Practice at Brown & Fortunato.  

“They essentially amortize your bid limit based upon the purchase price divided by 60 months, so if you win a contract you'll get paid on a monthly rental basis and the beneficiary will never own the device,” she said. “They talk about it as if, this way the supplier can give (beneficiaries) new technology and you update the software.” 

Are other supplies also fair game? 

CMS also proposes to specify that ostomy, tracheostomy and urological supplies are medical equipment items mandated for inclusion under RID CBP – a “creative argument” that overlooks the original statute governing the competitive bidding program, says Bachenheimer. 

“The original statute tells CMS what they can put in the program - it’s DME, enteral and off-the-shelf orthotics,” she said. “They make the argument that the term ‘medical supplies’ is used with DME generally, so they can put (those items) in anyway. It’s unbelievable.” 

Will there be an increased administrative burden? 

Additionally, CMS proposes to implement stricter requirements for both providers and accrediting organizations. It wants providers to go through the accreditation process every year vs. every three years. For AOs, it wants to: 

• Increase the amount, specificity and frequency of data AOs must submit to CMS 
• Expand its ability to closely monitor and review the operations of AOs 
• Strengthen its ability to act against poorly performing AOs 

“I think they are putting the onus on the accreditation organizations to weed out fraud and abuse,” said Bachenheimer. “Accreditation organizations are going to have to look at the proposed new requirements very carefully.” 

How should the industry respond? 

While stakeholders continue to analyze the proposed rule, they say they are already making plans to push for a seat at the table, says Isaacson. It’s going to take more than just industry associations to fight back, he says. 

“It’s going to take an uprising from the industry to really highlight and explain and show the actual implications of any negative effect on the industry,” he said. “There are real people that are not going to be able to say in their homes or they’re going to show up at hospitals far sicker and far sooner than they are with our services.” 

• Read CMS’s fact sheet on the rule here.  
• Related: ‘We know the headwind’: Stakeholders react to return of competitive bidding  
• Related: Flawed from the beginning’: Revival of bidding program raises alarms