Friday, January 2, 2009

George Will's Column on Medicare Bidding Program Leaves out the Facts

On January first, George Will, an op-ed columnist for the Washington Post, published a column about Michael Leavitt’s (secretary of Health and Human Services) predictions on the rising cost of health care. In Will’s column he says, “Medicare is a price-fixing system for upward of 12,000 procedures and drug codes -- and for hundreds of categories of equipment, the providers of which tenaciously oppose competition. Leavitt began implementing a tiny program of competitive bidding covering just 10 products in 10 cities. Based on the 15 days it lasted before Congress repealed it, savings were projected to be substantial. That is why equipment providers got it repealed."

The American Association for Homecare believes otherwise. The bidding program was not, in fact, repealed by Congress. The word repeal is used twice by Will. It was only slightly reformed and delayed by the Medicare Improvements to Patients and Providers Act of 2008 in order to fix problems because the implementation of the program was a train wreck, as Democrats and Republicans in Congress can attest.

The substantial savings the program were to have reaped will in fact be reaped, dollar for dollar, via a nationwide reimbursement cut to home medical equipment of 9.5 percent that kicks in today, January 1. In other words, the home medical sector is saving Medicare every dollar projected to be saved in order to make the bidding program fair and transparent.

Describing the program as "tiny" is wrong. The 10 home medical categories covered in the bidding program represent the lion's share of the spending in this sector. The initial 10 metro areas would be followed quickly by another 70 areas.

The truth is home medical equipment providers compete on the basis of service since Medicare sets prices. Home medical providers offer what Leavitt himself has called a "radically more efficient" and cost-effective form of healthcare than institutional care for Medicare beneficiaries.
Home medical equipment and therapies require many ongoing services that are not recognized by Medicare. Reimbursing oxygen therapy, for instance, as if it were merely a piece of equipment is not only inaccurate, it may well lead to dangerous lapses in attention and services that COPD patients require.

Here's the real story: Home medical equipment represents less than 2 percent of Medicare spending and it's the slowest-growing sector. But it's a big part of the answer to our healthcare financing challenges. It's not the problem -- not by a long shot.

To read George Will’s piece in the Washington Post visit: The association also encourages you to comment online.


Brian said...

Mr Will is a Moron in my opinion. I think Mr Will should spend a minimum of 2-3 years relying on the Medicare system and it's competitive bidding. The first article he would write after that time period would a 360 degree turn around. Let him feel the pain of a competitive bidding plan that put's his healthcare provider out of business or at best delivers him equipment that fails to work becuae the dealer has to buy the cheapest equipment available just to stay in business. Mr Will would be begging in his articles to reverse the system.

Anonymous said...

It is obvious Mr. Will knows far more about baseball than the home medical equipment business. The Will article and the MLN "A Better Way for Medicare to Pay for Med equipment might lead the uninitiated to think bidding is the better way. Wrong. If this bid process continues, States will soon follow. Small tax paying businesses like this one employing 7 people will become extinctand their customers, Medicare beneficiaries will suffer. At two effective cents on the healthcare dollar why not look to admin costs, convoluted billing processes, uncooperative intermediaries, vague rules, punitive attitudes...