Deep Flaws in Medicare Competitive Bidding Program for Durable Medical Equipment Were Not Fixed and Are Not Addressed by Recent GAO Study

The American Association for Homecare has worked with Congress and Medicare to address flaws in the competitive bidding program for durable medical equipment, some of which are discussed in a new Government Accountability Office (GAO) report. However, deep structural and design flaws still remain in this bidding program. Those flaws will reduce seniors’ access to quality care at home and will put thousands of competitive homecare providers out of business.

“The first round of Medicare’s competitive bidding program for wheelchairs and other forms of ‘durable medical equipment’ was poorly timed, was unclear about what had to be included in bids and failed to notify all suppliers that losing bids could be reviewed, according to a new Government Accountability Office study,” reports CQ Healthbeat News.

The report further details the lack of notification to providers about the post-bidding review process. The report recommends that CMS improve future rounds of bidding by notifying all suppliers if a disqualification review process is conducted, giving all suppliers an equal opportunity for such reviews; and contains a recommendation that CMS make it very clear how suppliers can request a review.

AAHomecare continues to say that there are underlying flaws with the bidding program that CMS has not addressed such as evaluating CMS’ methodology for determining bid rates and the fact that there was significant variation in bid rates for the exact same product billing codes across various bidding areas. Beneficiaries will be forced to go to multiple, unfamiliar providers for different items and services and will see reductions in service and quality of items based on artificially low winning bid amounts. Also, the bidding program, as currently structured, will force the majority of providers out of business.

“The fact remains that CMS has not fixed the fundamental problems in the design and structure,” said Tyler J. Wilson, president and CEO of the American Association for Homecare. ‘Those fundamental flaws in the structure of the program are dangerous because they will reduce seniors’ access to quality, cost-effective care at home, and the flaws will needlessly put thousands of competitive, hard-working medical equipment providers out of business.”

To learn more, visit associations/3208/files/AAHomecare Comments on GAO Study of Bid Program December 2009.pdf.